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Carbon Tax

Carbon Pricing is coming. Here’s how CLT will out-compete its carbon emitting competitors on cost.

If you have read the UK government’s Industrial Decarbonisation Strategy you will have noticed that the government intends to use the market to “determine the most cost-effective pathways to de-carbonisation”

Therefore, the first action in their plan is to “Use carbon pricing as a tool to send a clear market signal”. What this means in simple terms is that products that emit carbon will be taxed. We expect CLT which sequesters carbon not to be taxed.

In simple terms, steel, cement, concrete and bricks are likely to be subject to a carbon pricing tax, while CLT will not. Once that happens, CLT can be expected to have a significant market advantage over those other materials.

We can’t say when this will happen, or how high the tax will be, but what we can say is that it seems certain that the tax will be imposed and given the speed of the push to decarbonise, this is likely to happen sooner rather than later. Maybe even in the timescale needed for planning and building a new project.

Our message is this; think about carbon pricing when starting a new project. Carbon taxes could add significantly to your build costs. We recommend that you avoid the taxes and the cost uncertainty by planning and building your project in CLT.