Skanska · Physical Exposure and Transition

Concrete + steel are the two heaviest contributors to embodied carbon. Decarbonisation pace of these sectors caps how fast contractors can cut project-level S3.

Purchased materials — cement, concrete, steel, bitumen and asphalt — are Skanska's single largest emissions category, totalling 775 ktCO2e in 2024 and averaging roughly 52-56% of scope 3 value-chain emissions across 2020-2024 [E1][E3][E5][E7]. This dependency is structural: as a contractor Skanska does not manufacture most of these inputs itself, so its embodied-carbon footprint is capped by how fast its cement, concrete and steel suppliers decarbonise [E5]. The category has fallen from 987 ktCO2e in 2020 to 775 ktCO2e in 2024, but remains far larger than Skanska's own scope 1+2 footprint of 181 ktCO2e [E1][E6].

Skanska uses the EC3 embodied-carbon calculator (which it co-founded via Building Transparency) across projects, including mandating it on all new US developments from 2021 and applying it at 1550 on the Green in Houston to cut embodied carbon ~34% [E1][E2][E4]. It runs its own low-carbon concrete production (Skanska Betong, Rebetong recycled-aggregate concrete) that reached 15-16% of Swedish concrete output by 2022-2023, operates the Vällsta plant capable of 100% recycled asphalt and BioZero near-zero-carbon asphalt in Sweden, and substitutes mass timber for steel/concrete on projects like Portland International Airport (saving 3,900 tonnes CO2) and Hyllie Terrass (low-carbon precast façade saving ~3,000 tonnes CO2) [E3][E4][E6][E7][E8]. These supplier-engagement and material-substitution efforts sit under an SBTi-validated target to cut scope 3 emissions from purchased goods 50% by 2030 (from 2020) and 90% by 2045 [target data].

Aggregates, copper, aluminium, rare earths for finishings. Mining S1+2 caps upstream Scope 3.

Sector-generic framing shown above — company-specific exposure narrative pending.

Operational performance of completed buildings depends on tenant fit-out + grid mix in the country of construction. Contractors have indirect leverage.

Sector-generic framing shown above — company-specific exposure narrative pending.

Excavators, generators, delivery fleet — direct Scope 1 that a contractor can move most quickly. HVO + battery-electric plant availability sets the timeline.

Fuel used in on-site machinery, generators and delivery fleet accounts for roughly 90% of Skanska's own (scope 1+2) emissions, with diesel for machinery alone making up about half of scope 1 [E1][E3][E6]. Scope 1 stood at 149,000 tCO2e in 2024 against a scope 1+2 base of 402,000 tCO2e in 2015, so plant and fleet diesel is the single largest lever inside Skanska's operational footprint and directly underpins its 70% scope 1+2 reduction target for 2030 [E6]. This exposure is concentrated at the site level across Skanska's Nordic, UK and US construction operations rather than in fixed manufacturing assets.

Skanska is running parallel electrification and biofuel-substitution programmes: Norway operates 17 electric excavators including the ZED zero-emission diggers (up to 98% emissions reduction per machine on renewable power), with trials extended to the USA following Nordic success [E1][E2][E4][E6]. In the UK, diesel is being switched to HVO/HVO100 renewable fuel across site plant, delivering roughly 90% CO2e reduction, including a 100% diesel-free HS2 Phase One trial avoiding about 250 tonnes CO2e [E1][E5]. Additional levers include electrifying quarry production lines in Sweden (up to 35% of sites) and flagship fossil-free projects such as Stockholm's Slakthusområdet and Gottorps Hage, where non-electric machinery runs entirely on HVO [E2][E4][E6]; carbon intensity (scope 1+2) has improved from 2.60 to 1.03 tonnes/SEK M since 2015 as a result [E6].

Long tail of subcontractors + material suppliers carries most of the project embodied Scope 3. Credibility of tier-1 vendor targets determines pass-through.

Purchased materials—cement, steel, asphalt and bitumen—account for roughly 52-53% of Skanska's value chain emissions [E3][E7], making tier-1 material suppliers the single largest lever in its scope 3 footprint of 1,218,000 tCO2e in 2024. This exposure is concentrated in concrete and steel specification decisions made project-by-project, as illustrated by Skanska's own case studies at 1550 on the Green, Portland International Airport, and Hyllie Terrass [E1][E7]. With scope 3 targeted for a 50% absolute cut by 2030 and 90% by 2045 against a 2020 baseline, supplier-level carbon performance is directly load-bearing for the group's decarbonization trajectory.

Skanska requires suppliers to deliver Environmental Product Declarations (EPDs) and flows a Supplier Code of Conduct through all contract tiers, backed by nearly 500 supplier audits a year including a 2023 special risk assessment on aluminum and steel [E1][E4]. It co-developed the EC3 embodied-carbon comparison tool with Microsoft, mandating its use on all new US development projects since 2021, and has secured measurable wins such as fly-ash concrete substitution (~34% materials emissions cut at 1550 on the Green), mass timber over steel at Portland International Airport (3,900 tonnes CO2 avoided), and low-carbon precast concrete at Hyllie Terrass (~3,000 tonnes CO2 saved) [E1][E3][E7]. Skanska is also preparing for the EU Corporate Sustainability Due Diligence Directive and updated its Supplier Code of Conduct in November 2024, alongside maintaining a CDP Climate A- rating [E4][E5][E8].