Today as we stand together facing the second wave of the global pandemic, the economic recovery forecast remains more or less intact. Earlier this week, global financial services groups like Nomura and JP Morgan had trimmed India’s growth forecast for 2021-22 to 12.6 percent and 11 percent from 13.5 percent and 13 percent projected earlier. The double-digit GDP growth forecast for the current financial year also means that the core sectors will lead the country’s much-awaited economic recovery.
The massive public and private investment, particularly in the infrastructure and housing sectors will be offering unprecedented growth opportunities for India’s cement sector. As the world’s second-largest cement producing country, the new opportunities must be handled with great responsibility by continuing to invest in a sustainable manufacturing ecosystem.
According to Cement Sustainability Initiative (CSI), a global consortium of over 100 cement manufacturers from 25-odd countries, the potential savings in CO2 emission from the sector by 2030 can be as much as 1 giga tonne a year or roughly a third of the annual CO2 emission of a country like India.
Over the last decade or so, large cement producers in India have committed substantial investments in reducing their carbon footprint by paying attention to managing their energy consumption with great efficiency.
Given that energy accounts for around 25-30 percent of the operating costs of cement manufacturing it also makes economic sense. Thus, economic interest will continue to drive investments in green technologies. This will ensure that new growth opportunities will remain sustainable. To this end, investment in captive renewable energy generating capacities and Waste Heat Recovery System (WHRS) will be the centerpiece of India’s sustainable cement sector.
Simply put, WHRS converts the waste heat available during clinker production into a cheap source of power, thus helping in reducing the overall operating cost for manufacturers. The unit cost of energy from WHRS can be as low as 50-70 paise against Rs 6-8 per unit cost of grid power.
While the benefits of investing in WHRS is compelling from an operating cost and an environment point of view, the initial cash outflow can be quite substantial. A one-megawatt capacity WHRS can cost as much as Rs. 12 crore against Rs. 4-5 crore for coal or gas-fired power plant.
Further, the heat recovery process in a typical cement plant allows only a third of its power needs to be met from WHRS. However, despite these financial and technical challenges the long-term environmental gains and huge savings in overall operating costs continue to push large cement companies in India to commit precious capital in WHRS.
—Neeraj Akhoury is CEO at India LafargeHolcim and CEO and MD at Ambuja Cements. The views expressed are personal
(Edited by : Ajay Vaishnav)
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