Published on 25 November, 2007. By John Reynolds
ECOCEM, Donal O’Riain’s carbon-neutral cement firm, proves that giant multinationals don’t always lead the way in innovation.
A thorn in the side of market leaders in the cement business such as CRH, whose €16bn operations span several continents, Ecocem is the world’s first producer of carbon-neutral cement.
It’s a little-known fact that the cement industry is a worse climate criminal than either the aviation or IT industries, being responsible for six per cent of global carbon emissions.
This year China alone will churn out 540m tonnes of CO2; that’s as much as all sources of the gas from the 60 million people living in Britain.
In what is becoming an Irish-led green revolution in the construction business, Ecocem is busy laying the foundations for an entry into new foreign markets.
Alongside the likes of eco-house builders Century Homes and eco-city developers Treasury Holdings (one of Ecocem’s customers), O’Riain has recognised that the biggest opportunities are to be found abroad. “We can’t compete here in Ireland, but we’re determined to grow internationally,” says O’Riain.
Ecocem’s operations — at a €10m manufacturing facility in Dublin and another in the Netherlands — have notched up sales of €33m this year. “It’s been a tough battle for the past six years, but this year we’ll make our first taxable profits,” says O’Riain.
O’Riain spent 20 years in the construction industry, working for CRH in Ireland and overseas.
“I left 17 years ago and first took a management consulting role. Then I was involved with a property development venture, before starting Ecocem in 2000,” he adds.
Several of the firm’s management team have also worked for less green competitors like Readymix and Irish Cement.
French multinational building materials giant Saint-Gobain recently took a 30 per cent stake in Ecocem, while 31 per cent is held by private investors including the Durkan Group and Jed Pierse of Pierse Construction. O’Riain holds the remaining 39 per cent.
Recognising its potential, his former employer and other competitors have all tried to buy the company, but O’Riain is sticking to his guns for the time being. “All the larger players in the cement business have approached us. We probably get an offer every few months,” he says.
When it’s not fighting off competitors, the company has the support of a number of customers who are major industry players. Ecocem’s cement is being used in flagship developments in Dublin, including the new stadium at Lansdowne Road, the €380m National Convention Centre and the Department for the Environment’s new Wexford headquarters.
Local authorities such as Fingal County Council are beginning to incorporate requirements to use green cement in their Local Area Plans, in keeping with initiatives by the Office of Public Works and new public sector procurement regulations signed into Irish law last year.
Meanwhile, the US government has prioritised the use of products such as Ecocem’s in a new $286bn road construction project. With governments in Britain and Europe rivalling each other to boast of their environmental credentials, the firm could be uniquely placed to get a slice of the multi-billion euro infrastructure business.
Although each project generates its own carbon footprint, green cement brings a significant reduction. The Irish construction industry uses 15m cubic metres of cement every year, producing 5m tonnes of carbon dioxide.
Since its introduction to the market, the firm has helped cut emissions by 700,000 tonnes since 2004 — the equivalent of taking 170,000 cars off the road for a year.
His competitors regularly flood the airwaves with advertisements trying to justify the qualities of concrete. And he’s fighting a battle with them on the environmental front as well.
“Their quota for carbon emissions under the Kyoto Protocol means they’re effectively being subsidised by millions of euro. After 2008, when carbon credits become more expensive, the subsidy will amount to nearly €100m for CRH,” he says.
Ecocem recently enabled the Sustainable Building Exhibition and insurance company Hibernian to become carbon neutral, “and we’re looking for other companies here and abroad to co-operate with in the same way” O’Riain says. He adds, “We’re trying to create product and brand awareness at the moment. The business is now about marketing the product as much as making it.”