The Infrastructure Investment and Jobs Act (IIJA) includes historic levels of surface transportation spending, which is about half of the total $1.2 trillion package – the largest transportation reauthorization area over five years. Whether the new law’s transportation investments exacerbate our climate crisis or help us meet our climate goals — and more equitable and sustainable mobility options for communities across the country — will depend on how the U.S. Department of Transportation (US DOT) and state and regional agencies implement its key provisions.
Above all, the NRDC believes that agencies should take advantage of the flexibility offered by Congress to channel funding to cleaner alternatives to building new roads, including buses, trains and electric vehicles. But Secretary Buttigieg must not overlook the opportunity to combine billions in infrastructure investment with programs to purchase low-carbon building materials. This will ensure that whether we build railways, roads or bridges, we literally build back better with cleaner concrete, cement and steel.
The industrial sector, which includes the production of concrete, steel and other widely used building materials, was responsible for 23% of greenhouse gas (GHG) emissions in the United States in 2019. Because the federal government – and, in particular, the US DOT – is a prime buyer of these materials for federally funded transportation infrastructure, government procurement is a key lever for developing early markets for low-carbon alternatives and drive transformative change in factories and industrial processes. And because of the ubiquitous use of these materials in our built environment, if the US DOT shifts its purchasing power to encourage even modest reductions in embodied emissions, it could have major climate impacts.
Additionally, the impact would not be limited to reducing the GHG footprint of materials purchased directly by the government – although as a major purchaser of materials like concrete and steel, this direct impact could be substantial. . As more companies adopt cleaner manufacturing processes and/or products to compete for the vast pool of federally funded construction companies, these same manufacturers will sell low-carbon materials to buyers from the wider private market, alongside the public sector. This “indirect impact” has the potential to significantly increase emissions savings and reduce costs compared to public infrastructure projects alone.
In addition to funding major investments in transit and intercity rail, alongside traditional highway funding, the IIJA includes many new and highly competitive grant programs, totaling more than $100 billion in funding. The US DOT should exercise as much authority as possible to ensure that recipients competing for this funding consider the climate and equity impacts of their projects. Incentives to purchase low-carbon materials should be part of this process.
Sourcing by state and local recipients requesting these new sources of financing must take into account the carbon intensity of the building materials used for a project. This should include:
- measures intrinsic emissions from materials like concrete, using a well-known reporting document called an Environmental Product Declaration (EPD). EPDs are the best practice for measuring GHG emissions generated during the production of industrial building materials and products, and the federal government is key to encouraging and standardizing their use. As we have discussed here, the Biden administration is already taking significant steps in this direction; and
- a mechanism to credit the use of low-carbon options and thus integrate climate performance into the awarding of their contracts, alongside the cost.
There are several approaches that could be taken to encourage the reduction of embodied emissions in widely used building materials. Options for project competition criteria under new and existing programs include, but are not limited to:
- establish a maximum carbon intensity cap for building materials commonly used in public projects;
- offer a percentage discount to offers with the lowest carbon intensity, as set out in an EPD, which effectively makes them more competitive;
- awarding performance-based bonuses to suppliers who supply materials with low embodied carbon, as a new low-carbon concrete procurement bill introduced in New York would do;
- offering price premiums to induce contractors and/or suppliers to change their behavior, in addition to the price premium that applies to the materials themselves. [We estimate that with improved information on the embodied emissions of cement and steel, for example, GHG savings of 10-20% are available at very low premiums, and deeper decarbonization (60%+) could be available at a higher but still modest premium of ~10-15%]; and or
- the creation of a “super performer” level and a reserved funding pool to encourage offers that significantly outperform their competitors or achieve an exceptional level of GHG emissions reduction.
As the U.S. DOT accelerates implementation of the largest transportation law in history, the administration must seize this opportunity to maintain momentum in sourcing low-carbon materials. One of the largest and most immediate opportunities is to advance U.S. DOT procurement pilots as part of the implementation of the Generational Transportation Infrastructure Investment funded by the United States. ‘IIJA.
The bipartisan Infrastructure Act offers an unprecedented opportunity to transform the materials supply chain for transportation. We urge Secretary Buttigieg to make full use of the law’s new powers and tools, including incorporating cleaner materials into the roads and railroads that Americans travel every day.