The cement sector can't sit back on reducing CO2 emissions

This week Credit Suisse published a revealing study entitled 'Global Infrastructure and Construction', which looks into the current state of the global cement industry's efforts to reduce carbon emissions. The report attempts to highlight which countries and cement companies are not yet making sufficient headway in dealing with their CO2 emissions.

It may surprise many that the USA is the worst-performing nation in terms of one key metric, CO₂ per tonne of cement manufactured, which is recorded at ~800kg CO₂/t, and it is closely followed by the state of California (~790kg CO₂/t). Meanwhile, Mexico (~720kg CO₂/t), Thailand (~700kg CO₂/t) and the UK (~650kg CO₂/t) complete the top five laggards in the Credit Suisse table.

Credit Suisse explains that the USA’s poor performance is partly due to the low historical use of blended cements compared to most other areas of the world,  where a lower clinker factor, typically in the range of 70-80 per cent, has prevailed. In the US, Portland cement standards have historically required 95 per cent clinker, even if ready-mix producers add some cementitious supplementary materials (SCMs) to their mixtures.

It is in this context that several US cement producers have been switching to Portland limestone (PLC) cement manufacture. The PLC standard allows for up to 15 per cent limestone to replace clinker which translates to a 7-10 per cent reduction in CO₂ emissions.

China, which consumes over 50 per cent of worldwide cement volumes, is ranked in 14^th position with just ~500kg CO₂/t of cement. However, China has seen its clinker-to-cement ratio rising from 57 to 66 per cent between 2015-20. This deterioration, which resulted from a change in standards to eliminate low-quality cement grades, is expected to reverse as China moves to implement current decarbonisation initiatives.

Companies needing to improve CO₂ reduction
Credit Suisse lists those companies that are running behind the trend for cutting CO₂ emissions (based on 2020 direct emissions). In the USA Summit Materials tops the chart at 805kg CO₂/t of cementitious product produced, followed by Martin Marietta at 750kg CO₂/t and Eagle Materials at 730kg CO₂/t. Significantly better performances are being achieved by Holcim, operating at 555kg CO₂/t of cementitious product, and CRH at 573kg CO₂/t, as well as HeidelbergCement and Buzzi Unicem, which are operating at 590kg and 694kg CO₂/t of cementitious product produced, respectively in 2020. However, all of these numbers are well behind Ambuja Cement and Shree Cement in India, which set the standard at 531 and 533kg CO₂/t of cementitious product, respectively. 

Carbon capture utilisation and storage (CCUS) 
The cement industry will rely on carbon capture utilisation and storage to reach its net-zero targets. The IEA estimates that carbon capture could offset as much as 5Gta by 2050, versus ~35Gt in 2020. Furthermore, the IEA estimates that CCU/CCUS represents 14 per cent of the global net-zero emissions reduction target and 20.8 per cent of the 2030-50 net-zero scenario reduction target.

Cemex estimates it will reach net emissions ~200kg/m³ of concrete by 2030, a 41 per cent reduction on its 2020 levels of 340kg/m³. However, the company believes that 59 per cent of its needs to reach net-zero will be met by carbon capture. Holcim similarly estimates that 50 per cent of its CO₂ emissions will need to be met by CCUS between 2020-50. Indeed, Credit Suisse estimates that traditional mechanisms to lower carbon emissions will soon be exhausted. The analysts predict only a further 13 per cent reduction between 2030-50 can be achieved without the implementation of CCU and CCUS.

According to the CEMBUREAU, the European cement association, even assuming 100 per cent clean electricity and fuel as well as minimal clinker factor, emissions per tonne of cement would still be 280kg CO₂/t, owing to the clinkerisation process alone, which highlights the challenge of reaching net zero. Additional CO₂ reductions must come from low-emission transport such as electric trucks and higher substitution of fossil fuels with alternative fuels.

Summary
The Global Cement & Concrete Association expects CCUS to become significant only after 2030 when commercial viability and the necessary infrastructure have been established. The cost of CCUS facilities is estimated to be US$35-155/Mt of CO₂ for cement production, according to Boston Consulting Group. Cemex is reportedly pushing its carbon reduction projects to achieve a breakeven carbon cost of US$80.60/t CO₂ compared to the EU carbon allowance price of US$85.60/t CO₂.

Meanwhile, in order to reach the 2030 intermediary targets, the challenge for the cement sector as a whole is to manager the variation in opportunities to reduce carbon, with availability of clinker substitutes greatly dependent on local raw materials, and alternative fuels utilisation often limited by domestic regulatory frameworks around waste disposal and landfill costs.

However, there are clear opportunities for companies and countries to accelerate decarbonisation, provided they select the best strategies. Industries can start by lobbying to reform standards and regulations to allow for the greater utlisation of clinker substitutes as well as alternative fuels.