The cost of carbon, priced into the bid sheet.

For the better part of a decade, embodied carbon was the rhetorical commitment that never quite hit the spec sheet. That changed in March, when the European Commission published the seventh delegated act of the CSRD — the one that finally converts “major construction projects” from a reporting category into an enforceable line item.

From January 2027, every project above €40m built inside the EU will have to disclose embodied emissions on a per‑material basis, audited to ISO 14067, before practical completion. Failure to file blocks payment of the final 5% of public funds. California’s SB‑261, signed in February, takes a different route: it converts non‑disclosure into a private right of action for any taxpayer in the project’s jurisdiction. Either way, the game has changed.¹

For an industry that learned to sleeve sustainability behind glossy renderings, the next eighteen months will be a forensic exercise. Every cubic metre of concrete and every tonne of structural steel poured between now and the deadline will need a paper trail that holds up in audit — and increasingly, in litigation.

Cement is responsible for roughly 8% of global emissions. Steel adds another 7%. Together they account for somewhere between 60% and 75% of the embodied carbon in a typical commercial structure, which is why both regulations carve out the two materials for special treatment. EPDs — environmental product declarations — for concrete and steel will need to be product‑specific, batch‑traceable, and issued no more than 18 months prior to delivery. The era of generic industry‑average proxies is ending.

“The biggest blind spot in the supply chain isn’t the carbon itself. It’s the ten-year lag between when a mill upgrades its furnace and when the spec sheets catch up.” — Asha Pillai, head of materials at Aecom EMEA

The implication for procurement teams is awkward but unavoidable: the first question on a 2027 RFP will not be price. It will be whether the bidder can demonstrate, with a third‑party verified document chain, that the materials they are quoting actually exist as specified.

Bid documents are starting to read differently. The Boston Properties RFP for Kendall Tower, issued in February, requires bidders to submit an A1–A3 carbon budget alongside their cost breakdown and to commit to remaining within ±5% of the disclosed budget at handover. Penalties for overshoot are explicit: $112 per tonne of CO₂e overrun, capped at 4% of contract value.² That is the highest figure we have seen in private‑sector procurement, and it is likely to set the comp.

1. A1–A3 Cradle‑to‑gate emissions from raw material supply, transport to the manufacturing plant, and the manufacturing process itself.
2. A4–A5 Transport from the gate to the site, plus the construction‑installation process. Most large RFPs will start asking for these by 2028.
3. B1–B7 Use‑phase emissions over the building’s life. The frontier for design‑led decarbonisation, but legally toothless for now.

It is worth pausing on what a ±5% commitment actually requires. Assuming a 30‑storey commercial structure consumes roughly 24 000 tonnes of CO₂e in A1–A3 alone, the contractor is being asked to land within 1 200 tonnes either way of a number established two years before ground‑break. That is not impossible. But it is a different exercise from the one most general contractors are organised to run.

The firms in the strongest position right now are the ones that started building EPD muscle in 2023 — the early adopters of OneClick LCA and Tally, even when the spec did not strictly require it. They have a two‑year operational lead in a market where compliance is about to become tablestakes.

The losers are mid‑market generalists who never invested in materials data infrastructure: not because their carbon performance is necessarily worse, but because they cannot prove what theirs is. In procurement, what you cannot prove, you cannot bid.³

Expect the next twelve months to feature a wave of acquisitions, particularly from the larger Tier‑1 contractors hoovering up specialist LCA consultancies to bring the capability in‑house. Mott MacDonald’s purchase of Carbon Designed in February, at a reported revenue multiple north of 6×, is the first move of what will likely be a very busy pattern.