Cement Manufacturers Association (CMA)

51 flagship scheme pioneered by the Bureau of Energy Efficiency, the cement manufacturing industry is one of the designated consumers earmarked for integration of energy efficiency within industrial operations. The performance of the cement sector has been quite impressive as well, overachieving the allotted energy efficiency targets by 81.6% (PAT Cycle I) and 48.6% (PAT Cycle II). Such admirable adherence and overachievement of energy efficiency compliance targets have been effected as a result of several technological interventions such as waste heat recovery system (WHRS), high efficiency screw compressor, boosting alternative fuels and raw materials (AFR), kiln shell radiation recovery system installation, high efficiency third generation air separator installation, vertical grinding mill, vapour absorption machine (VAM), use of baffle plate inside twin cyclone, reduction of clinker factor, multiple stage pre-heater and high recuperation efficiency hydraulic cooler, among other measures. While energy efficiency has been put forward as one of the least cost pathways for emissions reduction in the cement manufacturing sector, the aforementioned technological interventions are quite capital intensive in absolute financial terms. The actualised energy savings in the Indian cement industry are estimated to be translated into monetary savings of INR 9,500 crores (PAT Cycle I) and INR 30,000 crores (PAT Cycle II). However, as lucrative as these figures may appear at a quick glance, the high capital cost associated with such technological retrofitting measures has significantly attenuated the adoption of such practices across the cement industry. In the absence of market based mechanisms, alternative financial measures such as accelerated depreciation, capital subsidy, tax benefits and import duty reduction are the only way to popularise and accelerate the adoption of such practices across the entire spectrum of industrial players within the Indian cement sector. Infrastructural and Industrial Process Status Quo: The Case for Emissions Offsets From the previous section, it is evident that the high capital cost of industrial retrofitting solutions has retarded the rate of adoption of energy efficiency measures across the Indian cement industry. Furthermore, from an economic standpoint, it might also be argued than an unfair burden is placed on the cement industry, since the financial returns on infrastructural investment; whether it be simple payback period (SPP), discounted payback period (DPP), net present value (NPV) or internal rate of return (IRR); are calculated purely as a function of monetary savings actualised with respect to a baseline scenario. There is no actualised revenue stream that can be tangibly created through the implementation of technological energy efficiency solutions, creating a high-risk situation for industrial adopters of such capital-intensive measures. Furthermore, considering the general emission- intensive nature of the cement industry, it can be understood that there is a limit to emissions reduction that can be actualised through the technological retrofitting pathway. If the sector aspires for ‘net-zero’ emissions (Scope 1 and Scope 2 GHG), merely focusing on energy efficiency is a good starting point, but will eventually saturate with a stalemate situation characterised by diminishing marginal utility of additional investments after a certain threshold of technological interventions and corresponding financial investments. Negative emissions technologies (NET) are critical for the achievement of net-zero emissions for the Indian cement industry. Unlike energy efficiency measures, NETs can facilitate the actualisation of net-zero aspirations through removal of residual emissions after the implementation of capital- intensive technological retrofitting solutions focusing on energy efficiency. In stark contrast to the limiting case for energy efficiency measures, which can only reduce the emissions intensity of the cement industry to a finite positive non-zero value, the limiting case for NETs does not stop even at net-zero. NETs are the only approach through which ambitions of net-zero can be upgraded to ambitions of carbon negativity, allowing the sector to turn back the proverbial ‘climate clock’, removing historical emissions of the cement industry, over and above balancing real-time unavoidable emissions from optimised industrial operations. The Present State of Carbon Capture Technologies: There are a slew of options in point source carbon