The traditional cement sector in Ireland has reacted angrily to the claim from Ecocem managing director Donal O'Riain that the cost of the environmental and health damage caused by its plants since 2000 is nearing €2 billion.

Mr O’Riain, who is to address a conference on the built environment in Dublin on Wednesday, is to tell the conference that by far the biggest cost of cement manufacturing, equivalent to 63 per cent of its selling price, is the cost to the environment and to health.

"That is what economists call an externality. It is of course a classic and dangerous form of market failure," he told The Irish Times . He suggested the issue could be addressed by pollution taxes or tradable emissions permits.

Mr O'Riain, who says his company's cement involves a substantially reduced amount of environmental pollution in its production (it uses a byproduct from the steel manufacturing process), said he arrived at his €2 billion calculation by taking data on emission levels from Irish cement manufacturing plants as recorded by the Environmental Protection Agency (EPA), and applying to them a monetary weighting developed by the European Environment Agency (EEA) for each of the pollutants covered.

Asked for a comment, a spokesman for the Cement Manufacturers of Ireland disputed the calculations made by Mr O’Riain.

"We categorically reject these claims as grossly inaccurate and a misrepresentation of an EEA report in which there is no attribution to cement production. The Irish cement industry is fully regulated by the EPA and emissions limits are set under strict licensing arrangements to ensure World Health Organisation and other international requirements to protect human health are met."

The spokesman said Mr O’Riain’s use of “generalised figures” which he then attributed proportionally to the traditional cement production process was “a misrepresentation of the EEA report and is also irresponsible”. There was considerable variety in emissions with concentration effects differing significantly between various industries and processes.

Mr O’Riain described the spokesman’s comment as a “familiar, telltale, non-denial denial”.