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Carbon Financing For Low-Carbon Buildings
2025-05-21
Author: UNEP, Cues Foundation, OFFSETFARM
Region of Activities: Global
Origin: GlobalABC/UNEP and Cues Foundation

Commissioned by UNEP as host of the Global Alliance for Buildings and Construction (GlobalABC), in collaboration with Cues Foundation and Offsetfarm, and supported by Germany’s Federal Ministry for Economic Cooperation and Development (BMZ), this report highlights the urgent need to address embodied carbon in five key construction materials—cement, aluminium, steel, bricks, and glass.

These materials account for over 20% of global greenhouse gas emissions and 9% of emissions in the buildings and construction sector. With the sector responsible for 37% of global CO₂ emissions and 34% of energy demand, urgent action is needed to reduce its climate impact. Transitioning to low-carbon materials could lower emissions in some building types by 19–46%, yet data gaps remain around the emission profiles and costs of such alternatives.

This report also examines 28 carbon credit methodologies, with a focus on 10 that directly address embodied carbon. 

To meet global net-zero targets, estimated to require $9.2 trillion in annual investments, the report underscores the importance of mobilizing finance—including through carbon markets—to scale up the adoption of low-carbon building materials and close existing methodological gaps.