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Cement Outlook 2012: Not as bleak as it looks

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Every other news that pertains to the cement sector presents a gloomy picture and leading the posse are research analysts who are not very optimistic of cement stocks with the exception of a few leading companies that have consistently performed well even under duress. Indian Cement Review checks out whether it is time to call the doctor….The Indian cement industry had witnessed a dream run in the recent past. Consumption of cement in the country had grown at a CAGR of 9.9 per cent during the period FY 06-10. The cement demand growth had surpassed the economic growth rate during the same period. In FY10, cement demand grew at 11.1 per cent recording a multiplier of 1.4 times with the economic growth rate. However, in FY11, cement demand grew at merely 5.1 per cent on YoY basis. The multiplier of cement demand growth to the GDP growth declined below one. Construction activities remained subdued in the last fiscal owing to various reasons. Prolonged monsoon, heavy winter, delay in execution of infrastructural projects due to environmental hurdles and end of construction activities related to Commonwealth Games all together led to lower cement demand growth in FY11. Slowdown in the housing sector due to rising interest rates also impacted cement off take.The long-term cement demand in the country is expected to remain intactGoing forward, cement demand will largely be driven by the increased focus of the government on the infrastructure development and promotion of low-cost affordable housing in the country. The real estate sector continues to dominate as the largest cement-consuming sector in the country. Decent economic growth, rising income levels of a growing middle class, concept of nuclear families catching pace, tax incentives and modern attitudes towards home ownership (the average age of a new homeowner has declined to 32 years compared with 45 years a decade ago) will continue to boost the housing demand and real estate related to the retail segment. The measures announced in the recent budget also indicate continued support of the government to the affordable housing segment which will help the real estate sector to continue its growth momentum and in turn cement demand. CARE Research estimates that in the next four to five years, cement demand to the tune of about 250-260 mn tonne is expected to emanate from the construction of new dwellings in the urban region alone.Infrastructure sector will need more than 600 million tonne of cement during the Twelfth Five Year PlanCement demand is expected to pick up as government expenditure on infrastructure projects catches momentum. In the recent budget, GoI has taken various initiatives to attract foreign funds towards the infrastructural sector. Such measures will help in providing the much-needed financial support to the infrastructural projects and in turn enable faster execution which will boost the cement demand. GoI has envisaged an investment of more than Rs 4000 bn for infrastructure development under the Twelfth Five Year Plan. This will augur well for the cement industry, currently almost 25 per cent of the total cement consumption in the country is contributed by the infrastructure sector. Based on the cement component in the civil construction, CARE Research has estimated that the investments planned under various sub-sectors of the infrastructure sector during the Twelfth Five Year Plan will derive a cement demand of more than 600 million tonne. The share of the infrastructure sector in the total cement consumption is estimated to reach a level of 35 per cent by the end of FY17. Cement demand which is expected to emanate on the back of the planned investments under different infrastructure sub-segments in the Twelfth five year plan is shown in the following chart: Cement demand is expected to grow at a CAGR of 9.3 per cent during the period FY 12-14. The following table gives the overall cement demand-supply situation over next three years:Capacity utilisation rate to remain in the range of 74-76 per cent during FY 12-14In past few years, the gap between cement demand and capacity has been widening due to substantial capacity addition. The cement industry witnessed a capacity addition of about 142.2 million tonne during the period of FY05-11. Out of this, about 67 million tonne of capacity was added in last two fiscals which is almost 23 per cent of industry’s total capacity as on March 31, 2011. As a result, the overall utilisation rate of the industry dropped from the peak of 93 per cent in FY07 to 75 per cent in FY11.Cement industry is expected to add capacity of about 86 million tonne in the period FY 12-14. The industry will continue to face a surplus situation. The operating rate of the industry will remain in the narrow range of 74 – 76 per cent during FY 12-14.Even though the Break-even Cushion is at comfortable level, prices to remain under pressureEven with the decline in the operating rate to a level below 80 per cent, the cement industry has been able to hold the prices on the back of high break-even cushion value.Break-even CushionBreak-even cushion is defined as the ratio of overall capacity utilisation rate of the industry to the utilisation rate at the break-even point in a particular year.Although the break-even cushion value has declined in the past three years, it is still at the comfortable level of two times. With this, cement industry is in better position to avoid substantial price cuts. However, CARE Research expects cement prices to remain under pressure in the current fiscal.(Revati Kasture, Head – Industry Research & Chaitanya Raut, Sr. Manager CARE Ratings)Operating rates will be challenged, profitability headed towards decadal lowCRISIL Research expects cement profitability to decline to its lowest level in the past 10 years by 2012-13. A huge demand-supply imbalance, fueled by supply glut, will drive cement profitability down. The supply glut will slacken cement manufacturers’ operating rates, restricting their ability to pass on a sharp rise in power and fuel costs to consumers.Over the next two years, while cement capacities rise by 60 million tonne per annum (mtpa), demand will increase by a mere 30 mtpa. Operating rates of cement manufacturers will therefore plunge to around 72 per cent in 2012-13 from an already subdued 78 per cent in 2010-11. Cost of power and fuel, a major input for cement, will increase by around 18 per cent in 2011-12, given a steep increase in coal prices by the industry’s dominant supplier, Coal India Ltd. In addition, an increase in effective excise duty rates will lower cement manufacturers’ net price realisations by 2-4 per cent."The magnitude of the demand-supply imbalance and cost escalation will halve the cement industry’s EBITDA margins from the current 20 per cent to around 10 per cent in 2012-13 – the lowest level in the past 10 years," Prasad Koparkar, Head – Industry and Customised Research, CRISIL Research said. Small-sized cement manufacturers – with capacities of less than 2 mtpa – are likely to post losses of about 2 per cent at the EBITDA level in 2012-13. Large cement manufacturers – capacities of 10 mtpa or higher, however, will fare better than the industry average, with EBITDA margins of about 12 per cent.The key reasons for the better performance of large cement manufacturers will be their greater use of captive power and their inherent economies of scale. These companies meet three-fourth of their power requirements through captive generation. Small cement companies, in contrast, meet a mere 5 per cent of their power requirements through the captive route, and source the remainder from the more expensive grid power. "Captive power can make a critical difference to cement profitability," Ajay D’souza, Head, CRISIL Research explained. "Every 10 percentage point increase in captive power consumption can improve cement companies’ EBIT DA margins by 50 basis points."An expert from the industry however dismisses the fears and says that the environment is being painted gloomier than it actually is. "If you look at some established companies they have been doing well despite the hardships and constraints. We expect the agriculture sector to grow and with the good monsoons we have had so far, we are looking at greater rural demand – NREGA spending is up. In a bid to counter global slowdown the government is already planning to boost up internal spending on infrastructure."Sumit Banerjee, CEO, Reliance Cementation, has this to say on the scenario: "Cement sector is cyclical and what we are seeing today is hopefully the bottom of the cycle. The current imbalance in the demand-supply situation is temporary and that too regional in nature. While a near equilibrium exists between demand and supply in some regions, there is excess capacity in South. With consumption growth expected to remain under pressure on account of delays in infrastructure and reality projects, rising capital cost, etc. the average all India capacity utilisation level in FY 12 is expected to touch less then 75 per cent, lowest in the past decade, and then gradually climbing back to 77 per cent in FY 13 and more than 78 per cent in FY14. However, on a longer term basis, with a GDP growth back on track, and thrust on development of physical infrastructure, we expect the growth in cement demand to be robust at around 10% in future. Moreover, with fewer limestone deposits now available to support new plants, coupled with constraints of acquiring land and getting statutory approvals, capacity additions through new green field projects will also slacken in the coming few years. Together, both these factors are likely to result in shortening the down cycle time for the industry and 90 per cent capacity utilization level could be reached earlier than expected."On the drop of prices in the month of July he says, "The drop in cement prices in July is on expected lines due to onset of monsoon as there is an overall slowdown in construction activities. Prices are expected to remain under pressure until Oct 11 and thereafter we may see some upward correction."According to him the eastern and central regions are expected to show higher growth as compared to the other regions.Don’t call the doctor yet….Bleak as it looks, the industry has the capability to withstand the onslaught of varied negative factors and still come out a winner. Despite many analysts predicting dark days ahead for cement companies, shares of some of the larger companies have managed to hold their own while other sectors have dipped. Post the announcement of RBI on credit tightening, domestic benchmark indices have lost 12 per cent in value. The Bombay Stock Exchange’s benchmark Sensex lost 2,194.54 points, to close at 16,676.75 on August 30. But cement stocks have not only stood steady some of them have appreciated. At the time of going to press, UltraTech Cement had gained 7.1 per cent since then and Ambuja Cements was up by 1.4 per cent and ACC gained 0.4 per cent. While it may be true that the June quarter results may have something to do with their performance experts agree that it is definitely better than expected.True cement companies are facing problems that stretch from over-capacity, low price realisation to falling demand for building material, rising input costs, lack of major infrastructure projects and, a charge of cartelisation, but the days ahead still hold some hope. Comes the good news from some companies that dispatches are on the rise. Jaiprakash Associates has announced that its cement shipments in August rose 21 percent from a year earlier to 1.32 million tonne. ACC has announced that its production & despatch figures for the month of August 2011 recorded an increase in sales at 1.88 million tonne compared to 1.57 million tonne in the corresponding period. Also the production increased from 1.56 million tonne to 1.88 million tonne.With the monsoon coming to an end, demand is surely going to pick up soon. The government may also quick track many infrastructure projects to balance the global downgrade and help the economy and this also bodes well for the cement sector.10 Per cent growth, a possibilityWorldwide cement consumption is forecast to reach a record 3,859 million tonne in 2012, 17 per cent up from 2010 levels. Global cement consumption growth had slowed to 2.4 per cent in 2008, the crisis ridden year, recovered to 5.9 per cent in 2009 with volumes touching 2,998 million tonne and further to 3,294 million tonne in 2010, giving annual growth rate of 9.9 per cent. China dominates world cement statistics consuming 1,851 million tonne in 2010, almost double of 2004 levels, while India, the world’s second-largest consumer registered 212 million tonne in 2010. The United States, the third-largest consumer, saw demand fall down to 69 million tonne.What happened in India? The Indian cement industry sustained its growth rate even in the tough conditions of economic slowdown. According to FIRST Infocentre, the Indian cement industry witnessed tremendous growth on the back of continuously rising demand from the housing sector, increased activity in infrastructure, and construction boom. Recent industry developments and the government supportive policies are attracting global cement giants and sparking off a spate of mergers and acquisitions to spur growth. Numerous domestic and international cement companies are striving hard to establish their production base in the country.Majority of the cement companies expanded their installed capacity against the backdrop of government backed infrastructure construction projects as these projects created strong demand for cement. With the growth in real estate activities and boom in the development of infrastructure, cement industry was on a roll in India.Before venturing into forecast for 2012, it would be necessary to dwell into the base year, 2011. After growing by less than 5 per cent in 2010, cement consumption is projected to grow by 11 per cent to 240 million tonne in 2011.Cement consumption has a very strong correlation with the economic growth as construction activities pick-up with the rise income levels. Construction GDP is projected to grow 10 per cent.FIRST Infocentre provides three scenarios for cement consumption forecast for 2012 based on the correlation of past drivers, challenges, and opportunities for expansion;

  • The worst-case scenario forecast pegs cement consumption growth at 8 per cent in 2012 if real GDP grows by 6.5 per cent and prices of fuel inputs rise faster than in 2011.
  • The most likely scenario is around 10 per cent increase in cement consumption, wherein, the GDP will grow by 8 per cent and fuel costs move up moderately in line with the general inflation rate.
  • The optimistic projection pegs consumption growth at 12.2 per cent, assuming GDP grows 9.5 per cent and fuel prices rise slower than the general inflation rate.

Thoroughly examining all emerging trends and drivers fueling growth in the cement industry, the regional cement demand-supply dynamics varies from state to state. The Twelfth Five Year Plan is expected to spend over US$1 trillion on infrastructure sector over the five year period beginning 2012-13. During the first year, more of spill over projects will be targeted for completion, along with the addition of new plan projects. This will boost demand for cement in states that attract more investment projects. For example, Orissa has been seeing number of projects increasing rapidly.Courtesy: FIRST Infocentre

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Concrete

Fornnax Unveils the World’s Largest NPD and Demo Centre to Accelerate Global Recycling Innovation

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A 12-acre innovation campus enables Fornnax to design, test and validate high-performance recycling solutions at global standards in record time.

Fornnax has launched one of the world’s largest New Product Development (NPD) centres and demo plants, spanning more than 12 acres, marking a major step toward its vision of becoming a global recycling technology leader by 2030. Designed to accelerate real-world innovation, the facility will enable faster product design cycles, large-scale performance validation, and more reliable equipment for high-demand recycling applications.

At the core of the new campus is a live demo plant engineered to support application-specific testing. Fornnax will use this facility to upgrade its entire line of shredders and granulators—enhancing capacity, improving energy efficiency, and reducing downtime. With controlled test environments, machines can be validated for 3,000 to 15,000 hours of operation, ensuring real-world durability and high availability of 18–20 hours per day. This approach gives customers proven performance data before deployment.

“Innovation in product development is the key to becoming a global leader,” said Jignesh Kundariya, Director and CEO of Fornnax. “With this facility, we can design, test and validate new technologies in 6–8 months, compared to 4–5 years in a customer’s plant. Every machine will undergo rigorous Engineering Build (EB) and Manufacturing Build (MB) testing in line with international standards.”

Engineering Excellence Powered by Gate Review Methodology

Fornnax’s NPD framework follows a structured Gate Review Process, ensuring precision and discipline at every step. Projects begin with market research and ideation led by Sales and Marketing, followed by strategic review from the Leadership Team. Detailed engineering is then developed by the Design Team and evaluated by Manufacturing, Service and Safety before approval. A functional prototype is built and tested for 6–8 months, after which the design is optimised for mass production and commercial rollout.

Open-Door Customer Demonstration and Material Testing

The facility features an open-door demonstration model, allowing customers to bring their actual materials and test multiple machines under varied operating conditions. Clients can evaluate performance parameters, compare configurations and make informed purchasing decisions without operational risk.

The centre will also advance research into emerging sectors including E-waste, cables, lithium-ion batteries and niche heterogeneous waste streams. Highly qualified engineering and R&D teams will conduct feasibility studies and performance analysis to develop customised solutions for unfamiliar or challenging materials. This capability reinforces Fornnax’s reputation as a solution-oriented technology provider capable of solving real recycling problems.

Developing Global Recycling Talent

Beyond technology, the facility also houses a comprehensive OEM training centre. It will prepare operators and maintenance technicians for real-world plant conditions. Trainees will gain hands-on experience in assembly, disassembly and grinding operations before deployment at customer sites. Post-training, they will serve as skilled support professionals for Fornnax installations. The company will also deliver corporate training programs for international and domestic clients to enable optimal operation, swift troubleshooting and high-availability performance.

A Roadmap to Capture Global Demand

Fornnax plans to scale its offerings in response to high-growth verticals including Tyre recycling, Municipal Solid Waste (MSW), E-waste, Cable and Aluminium recycling. The company is also preparing solutions for new opportunities such as Auto Shredder Residue (ASR) and Lithium-Ion Battery recovery. With research, training, validation and customer engagement housed under one roof, Fornnax is laying the foundation for the next generation of recycling technologies.

“Our goal is to empower customers with clarity and confidence before they invest,” added Kundariya. “This facility allows them to test their own materials, compare equipment and see real performance. It’s not just about selling machines—it’s about building trust through transparency and delivering solutions that work.”

With this milestone, Fornnax reinforces its long-term commitment to enabling industries worldwide with proven, future-ready recycling solutions rooted in innovation, engineering discipline and customer collaboration.

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Concrete

Balancing Rapid Economic Growth and Climate Action

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Dr Yogendra Kanitkar, VP R&D, and Dr Shirish Kumar Sharma, Assistant Manager R&D, Pi Green Innovations, look at India’s cement industry as it stands at the crossroads of infrastructure expansion and urgent decarbonisation.

The cement industry plays an indispensable role in India’s infrastructure development and economic growth. As the world’s second-largest cement producer after China, India accounts for more than 8 per cent of global cement production, with an output of around 418 million tonnes in 2023–24. It contributes roughly 11 per cent to the input costs of the construction sector, sustains over one million direct jobs, and generates an estimated 20,000 additional downstream jobs for every million tonnes produced. This scale makes cement a critical backbone of the nation’s development. Yet, this vitality comes with a steep environmental price, as cement production contributes nearly 7 per cent of India’s total carbon dioxide (CO2) emissions.
On a global scale, the sector accounts for 8 per cent of anthropogenic CO2 emissions, a figure that underscores the urgency of balancing rapid growth with climate responsibility. A unique challenge lies in the dual nature of cement-related emissions: about 60 per cent stem from calcination of limestone in kilns, while the remaining 40 per cent arise from the combustion of fossil fuels to generate the extreme heat of 1,450°C required for clinker production (TERI 2023; GCCA).
This dilemma is compounded by India’s relatively low per capita consumption of cement at about 300kg per year, compared to the global average of 540kg. The data reveals substantial growth potential as India continues to urbanise and industrialise, yet this projected rise in consumption will inevitably add to greenhouse gas emissions unless urgent measures are taken. The sector is also uniquely constrained by being a high-volume, low-margin business with high capital intensity, leaving limited room to absorb additional costs for decarbonisation technologies.
India has nonetheless made notable progress in improving the carbon efficiency of its cement industry. Between 1996 and 2010, the sector reduced its emissions intensity from 1.12 tonnes of CO2 per ton of cement to 0.719 tonnes—making it one of the most energy-efficient globally. Today, Indian cement plants reach thermal efficiency levels of around 725 kcal/kg of clinker and electrical consumption near 75 kWh per tonne of cement, broadly in line with best global practice (World Cement 2025). However, absolute emissions continue to rise with increasing demand, with the sector emitting around 177 MtCO2 in 2023, about 6 per cent of India’s total fossil fuel and industrial emissions. Without decisive interventions, projections suggest that cement manufacturing emissions in India could rise by 250–500 per cent by mid-century, depending on demand growth (Statista; CEEW).
Recognising this threat, the Government of India has brought the sector under compliance obligations of the Carbon Credit Trading Scheme (CCTS). Cement is one of the designated obligated entities, tasked with meeting aggressive reduction targets over the next two financial years, effectively binding companies to measurable progress toward decarbonisation and creating compliance-driven demand for carbon reduction and trading credits (NITI 2025).
The industry has responded by deploying incremental decarbonisation measures focused on energy efficiency, alternative fuels, and material substitutions. Process optimisation using AI-driven controls and waste heat recovery systems has made many plants among the most efficient worldwide, typically reducing fuel use by 3–8 per cent and cutting emissions by up to 9 per cent. Trials are exploring kiln firing with greener fuels such as hydrogen and natural gas. Limited blends of hydrogen up to 20 per cent are technically feasible, though economics remain unfavourable at present.
Efforts to electrify kilns are gaining international attention. For instance, proprietary technologies have demonstrated the potential of electrified kilns that can reach 1,700°C using renewable electricity, a transformative technology still at the pilot stage. Meanwhile, given that cement manufacturing is also a highly power-intensive industry, several firms are shifting electric grinding operations to renewable energy.
Material substitution represents another key decarbonisation pathway. Blended cements using industrial by-products like fly ash and ground granulated blast furnace slag (GGBS) can significantly reduce the clinker factor, which currently constitutes about 65 per cent in India. GGBS can replace up to 85 per cent of clinker in specific cement grades, though its future availability may fall as steel plants decarbonise and reduce slag generation. Fly ash from coal-fired power stations remains widely used as a low-carbon substitute, but its supply too will shrink as India expands renewable power. Alternative fuels—ranging from biomass to solid waste—further allow reductions in fossil energy dependency, abating up to 24 per cent of emissions according to pilot projects (TERI; CEEW).
Beyond these, Carbon Capture, Utilisation, and Storage (CCUS) technologies are emerging as a critical lever for achieving deep emission cuts, particularly since process emissions are chemically unavoidable. Post-combustion amine scrubbing using solvents like monoethanolamine (MEA) remains the most mature option, with capture efficiencies between 90–99 per cent demonstrated at pilot scale. However, drawbacks include energy penalties that require 15–30 per cent of plant output for solvent regeneration, as well as costs for retrofitting and long-term corrosion management (Heidelberg Materials 2025). Oxyfuel combustion has been tested internationally, producing concentrated CO2-laden flue gas, though the high cost of pure oxygen production impedes deployment in India.
Calcium looping offers another promising pathway, where calcium oxide sorbents absorb CO2 and can be regenerated, but challenges of sorbent degradation and high calcination energy requirements remain barriers (DNV 2024). Experimental approaches like membrane separation and mineral carbonation are advancing in India, with startups piloting systems to mineralise flue gas streams at captive power plants. Besides point-source capture, innovations such as CO2 curing of concrete blocks already show promise, enhancing strength and reducing lifecycle emissions.
Despite progress, several systemic obstacles hinder the mass deployment of CCUS in India’s cement industry. Technology readiness remains a fundamental issue: apart from MEA-based capture, most technologies are not commercially mature in high-volume cement plants. Furthermore, CCUS is costly. Studies by CEEW estimate that achieving net-zero cement in India would require around US$ 334 billion in capital investments and US$ 3 billion annually in operating costs by 2050, potentially raising cement prices between 19–107 per cent. This is particularly problematic for an industry where companies frequently operate at capacity utilisations of only 65–70 per cent and remain locked in fierce price competition (SOIC; CEEW).
Building out transport and storage infrastructure compounds the difficulty, since many cement plants lie far from suitable geological CO2 storage sites. Moreover, retrofitting capture plants onto operational cement production lines adds technical integration struggles, as capture systems must function reliably under the high-particulate and high-temperature environment of cement kilns.
Overcoming these hurdles requires a multi-pronged approach rooted in policy, finance, and global cooperation. Policy support is vital to bridge the cost gap through instruments like production-linked incentives, preferential green cement procurement, tax credits, and carbon pricing mechanisms. Strategic planning to develop shared CO2 transport and storage infrastructure, ideally in industrial clusters, would significantly lower costs and risks. International coordination can also accelerate adoption.
The Global Cement and Concrete Association’s net-zero roadmap provides a collaborative template, while North–South technology transfer offers developing countries access to proven technologies. Financing mechanisms such as blended finance, green bonds tailored for cement decarbonisation and multilateral risk guarantees will reduce capital barriers.
An integrated value-chain approach will be critical. Coordinated development of industrial clusters allows multiple emitters—cement, steel, and chemicals—to share common CO2 infrastructure, enabling economies of scale and lowering unit capture costs. Public–private partnerships can further pool resources to build this ecosystem. Ultimately, decarbonisation is neither optional nor niche for Indian cement. It is an imperative driven by India’s growth trajectory, environmental sustainability commitments, and changing global markets where carbon intensity will define trade competitiveness.
With compliance obligations already mandated under CCTS, the cement industry must accelerate decarbonisation rapidly over the next two years to meet binding reduction targets. The challenge is to balance industrial development with ambitious climate goals, securing both economic resilience and ecological sustainability. The pathway forward depends on decisive governmental support, cross-sectoral innovation, global solidarity, and forward-looking corporate action. The industry’s future lies in reframing decarbonisation not as a burden but as an investment in competitiveness, climate alignment and social responsibility.

References

  • Infomerics, “Indian Cement Industry Outlook 2024,” Nov 2024.
  • TERI & GCCA India, “Decarbonisation Roadmap for the Indian Cement Industry,” 2023.
  • UN Press Release, GA/EF/3516, “Global Resource Efficiency and Cement.”
  • World Cement, “India in Focus: Energy Efficiency Gains,” 2025.
  • Statista, “CO2 Emissions from Cement Manufacturing 2023.”
  • Heidelberg Materials, Press Release, June 18, 2025.
  • CaptureMap, “Cement Carbon Capture Technologies,” 2024.
  • DNV, “Emerging Carbon Capture Techniques in Cement Plants,” 2024.
  • LEILAC Project, News Releases, 2024–25.
  • PMC (NCBI), “Membrane-Based CO2 Capture in Cement Plants,” 2024.
  • Nature, “Carbon Capture Utilization in Cement and Concrete,” 2024.
  • ACS Industrial Engineering & Chemistry Research, “CCUS Integration in Cement Plants,” 2024.
  • CEEW, “How Can India Decarbonise for a Net-Zero Cement Industry?” (2025).
  • SOIC, “India’s Cement Industry Growth Story,” 2025.
  • MDPI, “Processes: Challenges for CCUS Deployment in Cement,” 2024.
  • NITI Aayog, “CCUS in Indian Cement Sector: Policy Gaps & Way Forward,” 2025.

ABOUT THE AUTHOR:
Dr Yogendra Kanitkar, Vice President R&D, Pi Green Innovations, drives sustainable change through advanced CCUS technologies and its pioneering NetZero Machine, delivering real decarbonisation solutions for hard-to-abate sectors.

Dr Shirish Kumar Sharma, Assitant Manager R&D, Pi Green Innovations, specialises in carbon capture, clean energy, and sustainable technologies to advance impactful CO2 reduction solutions.

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Concrete

Carbon Capture Systems

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Nathan Ashcroft, Director, Strategic Growth, Business Development, and Low Carbon Solutions – Stantec, explores the challenges and strategic considerations for cement industry as it strides towards Net Zero goals.

The cement industry does not need a reminder that it is among the most carbon-intensive sectors in the world. Roughly 7–8 per cent of global carbon dioxide (CO2) emissions are tied to cement production. And unlike many other heavy industries, a large share of these emissions come not from fuel but from the process itself: the calcination of limestone. Efficiency gains, fuel switching, and renewable energy integration can reduce part of the footprint. But they cannot eliminate process emissions.
This is why carbon capture and storage (CCS) has become central to every serious discussion
about cement’s pathway to Net Zero. The industry already understands and accepts this challenge.
The debate is no longer whether CCS will be required—it is about how fast, affordable, and seamlessly it can be integrated into facilities that were never designed for it.

In many ways, CCS represents the ‘last mile’of cement decarbonisation. Once the sector achieves effective capture at scale, the most difficult part of its emissions profile will have been addressed. But getting there requires navigating a complex mix of technical, operational, financial and regulatory considerations.

A unique challenge for cement
Cement plants are built for durability and efficiency, not for future retrofits. Most were not designed with spare land for absorbers, ducting or compression units. Nor with the energy integration needs of capture systems in mind. Retrofitting CCS into these existing layouts presents a series of non-trivial challenges.
Reliability also weighs heavily in the discussion. Cement production runs continuously, and any disruption has significant economic consequences. A CCS retrofit typically requires tie-ins to stacks and gas flows that can only be completed during planned shutdowns. Even once operational, the capture system must demonstrate high availability. Otherwise, producers may face the dual cost of capture downtime and exposure to carbon taxes or penalties, depending on jurisdiction.
Despite these hurdles, cement may actually be better positioned than some other sectors. Flue gas from cement kilns typically has higher CO2 concentrations than gas-fired power plants, which improves capture efficiency. Plants also generate significant waste heat, which can be harnessed to offset the energy requirements of capture units. These advantages give the industry reason to be optimistic, provided integration strategies are carefully planned.

From acceptance to implementation
The cement sector has already acknowledged the inevitability of CCS. The next step is to turn acceptance into a roadmap for action. This involves a shift from general alignment around ‘the need’ toward project-level decisions about technology, layout, partnerships and financing.
The critical questions are no longer about chemistry or capture efficiency. They are about the following:

  • Space and footprint: Where can capture units be located? And how can ducting be routed in crowded plants?
  • Energy balance: How can capture loads be integrated without eroding plant efficiency?
  • Downtime and risk: How will retrofits be staged to avoid prolonged shutdowns?
  • Financing and incentives: How will capital-intensive projects be funded in a sector with
    tight margins?
  • Policy certainty: Will governments provide the clarity and support needed for long-term investment
  • Technology advancement: What are the latest developments?
  • All of these considerations are now shaping the global CCS conversation in cement.

Economics: The central barrier
No discussion of CCS in the cement industry is complete without addressing cost. Capture systems are capital-intensive, with absorbers, regenerators, compressors, and associated balance-of-plant representing a significant investment. Operational costs are dominated by energy consumption, which adds further pressure in competitive markets.
For many producers, the economics may seem prohibitive. But the financial landscape is changing rapidly. Carbon pricing is becoming more widespread and will surely only increase in the future. This makes ‘doing nothing’ an increasingly expensive option. Government incentives—ranging from investment tax credits in North America to direct funding in Europe—are accelerating project viability. Some producers are exploring CO2 utilisation, whether in building materials, synthetic fuels, or industrial applications, as a way to offset costs. This is an area we will see significantly more work in the future.
Perhaps most importantly, the cost of CCS itself is coming down. Advances in novel technologies, solvents, modular system design, and integration strategies are reducing both capital requirements
and operating expenditures. What was once prohibitively expensive is now moving into the range of strategic possibility.
The regulatory and social dimension
CCS is not just a technical or financial challenge. It is also a regulatory and social one. Permitting requirements for capture units, pipelines, and storage sites are complex and vary by jurisdiction. Long-term monitoring obligations also add additional layers of responsibility.
Public trust also matters. Communities near storage sites or pipelines must be confident in the safety and environmental integrity of the system. The cement industry has the advantage of being widely recognised as a provider of essential infrastructure. If producers take a proactive role in transparent engagement and communication, they can help build public acceptance for CCS
more broadly.

Why now is different
The cement industry has seen waves of technology enthusiasm before. Some have matured, while others have faded. What makes CCS different today? The convergence of three forces:
1. Policy pressure: Net Zero commitments and tightening regulations are making CCS less of an option and more of an imperative.
2. Technology maturity: First-generation projects in power and chemicals have provided valuable lessons, reducing risks for new entrants.
3. Cost trajectory: Capture units are becoming smaller, smarter, and more affordable, while infrastructure investment is beginning to scale.
This convergence means CCS is shifting from concept to execution. Globally, projects are moving from pilot to commercial scale, and cement is poised to be among the beneficiaries of this momentum.

A global perspective
Our teams at Stantec recently completed a global scan of CCS technologies, and the findings are encouraging. Across solvents, membranes, and
hybrid systems, innovation pipelines are robust. Modular systems with reduced footprints are
emerging, specifically designed to make retrofits more practical.
Equally important, CCS hubs—where multiple emitters can share transport and storage infrastructure—are beginning to take shape in key regions. These hubs reduce costs, de-risk storage, and provide cement producers with practical pathways to integration.

The path forward
The cement industry has already accepted the challenge of carbon capture. What remains is charting a clear path to implementation. The barriers—space, cost, downtime, policy—are real. But they are not insurmountable. With costs trending downward, technology footprints shrinking, and policy support expanding, CCS is no longer a distant aspiration.
For cement producers, the decision is increasingly about timing and positioning. Those who move early can potentially secure advantages in incentives, stakeholder confidence, and long-term competitiveness. Those who delay may face higher costs and tighter compliance pressures.
Ultimately, the message is clear: CCS is coming to cement. The question is not if but how soon. And once it is integrated, the industry’s biggest challenge—process emissions—will finally have a solution.

ABOUT THE AUTHOR:
Nathan Ashcroft, Director, Strategic Growth, Business Development, and Low Carbon Solutions – Stantec, holds expertise in project management, strategy, energy transition, and extensive international leadership experience.

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