Economy & Market

Optimising Logistics

Published

11 years ago

March 31, 2015

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Cement is a vital building material that demands well-organized distribution and timely delivery; and the most important focus areas are to optimize the logistics value chain of the product which includes first and last mile transportation.
In the last two years, logistics has emerged as a function of critical importance in cement business on par with manufacturing and marketing and sales. This is the activity that links cement from the point of its production till it reaches the hands of the ultimate consumer. When we use the term logistics, we mostly refer to outbound movement; but of course the function must ideally also include inbound logistics or the activities involving inward movement of raw materials, inputs and intermediate goods. But essentially logistics plays a collaborative role between manufacturing on one side and sales on the other.

Cement is a vital building material that demands well-organized distribution and timely delivery. The cost of transporting cement via road comes to about Rs 1-3/tonne/km. The wide range is due to the variation in lead distance, which can range from anywhere between 50-300 km. Longer the distance, lower is the cost of transport. Railway on other hand costs Rs 1.3 to 1.4/tonne/km. However, railway has additional fixed costs related to loading and unloading. The handling cost is high for railways. So for a distance below 200 km, rail is not viable. The total cost of logistics considering inbound and outbound movement can come up to 20-25 per cent of cement price. This is for companies having good infrastructure such as rail sidings, etc, and who transport 40-60 per cent product by rail. For companies that do not have such facilities, the cost can go as high as 30 per cent of the cement cost.

Market scenario
According to Tushar Dave, Vice President – Central Logistics, ACC Ltd, the importance of logistics in cement business cannot be understated. Says Dave, ?Typically, cement has to travel about 400 km from the plant before it reaches the end customer. The cost of outbound logistics represents nearly 20 per cent of net sales; in fact it comprises the second highest share of costs after manufacturing and fuel. On-time delivery is another critical area where logistics plays a role, considering that it is essential to ensure customer satisfaction. In view of these facts, logistics has enormous potential to deliver cost savings while simultaneously impacting customer satisfaction through improvements in service levels.?

He adds, ?A major bottleneck in this front is the time consumed at the loading bay. Trucks typically have had to wait for hours to enter and move out of the plant premises. This takes up a lot of the total travel and turnaround time and congests the bay during peak loading hours. ACC devised a unique solution to this problem by way of introducing the digitalised loading bay.?

Says Praveen Garg, Head – Logistics, Bharathi Cement, ?In the present scenario, logistics in cement industry plays a vital role to decide the competitive advantage or disadvantage for a company. Logistics in Indian cement industry per se is in growth stage and there is a long way to go to achieve consolidation and mature stage. Logistics cost is one of the highest cost elements and contributes 25 to 30 per cent of total spend in cement industry.? He adds, ?Existing infrastructure related to road, rail and sea transport is a major bottleneck, which does not provide flexibility as compared to developed nations. Indian cement industry still has separate vendors for primary transportation, last mile delivery and supply chain planning. Big 3PL and 4PL players are yet to come in cement logistics that can provide end-to-end solution.?

Functional bottlenecks
Speaking about the functional constraints Arun Khurana, Head – Logistics, JK Cement, had this to say. ?Definitely, logistics remains always under pressure when industry scenario is not so good. The prices are not supportive and with the logistics cost is pretty high, always the aim remains to how we can rationalize or optimize the logistics cost. Rail logistics constitutes almost 35 per cent of the total dispatches being done from the factory and now railways is reaching to the point of saturation. In fact, in the last 10 years, the percentage of rail has really come down from 40-45 per cent to 35 per cent and all this is because railways does not have sufficient infrastructure to support the demand requirement. So, the alternate mode comes as road. Again, the biggest challenge here is the availability of skilled drivers. It is not confined to cement alone, but the fact remains that these kinds of challenges are there in the transport industry which is directly linked to the cement industry as well. In the last two years, it seems the supply chain as a function is evolving across industries. So on that extent, skilled manpower available is not to the desired level.? Speaking about the functional bottlenecks, Capt. Ashok Shrivastava, Chief Executive Officer, Shipping Services, Allcargo Logistics, says, ?The fundamental reasons for challenges or bottlenecks in logistics especially in the cement industry has more to do with the product itself which is high volume and low value. This gives rise to the bottleneck of various kinds from transportation of raw material to plants and then from plants to the end-consumer through distribution channels. The challenge is compounded by India?s unique demography and its fast pace economic growth which is not concentrated in particular locations but is spread across all corners of the country. Thus, the demand is scattered but the production is located sparingly across states keeping in mind the economics of the business. Many of these macroeconomic variables cannot be altered to a greater extent, thus given this industry a unique set of opportunities and challenges. Logistics is the backbone of this product in demography such as India.?

He adds, ?Road has been the tradition medium of transportation, but given the congestion, limitation on quantity which can be carried, costs of toll across highways and the low average speed of movement it has given rail the opportunity to be one of the preferred modes of surface transportation. Coastal shipping has emerged as the most preferred medium of movement of cement, given its advantage in terms of costs as well as capacity to carry larger volume. Coastal shipping will be a game changer for India given that our country is surrounded by over 7,000 km of coastline and the cement industry can leverage this mode of transportation more effectively and efficiently to move its products.?

According to Prabhat Ranjan, AGM – Sales & Logistics, Meghalaya Cement, there are two sides to bringing down cost of logistics; one is infrastructure and the other is technology. ?As far as infrastructure is concerned, whenever a truck load is coming, there should be a scope for return load so that the freight cost remains low. Here in the North-East region, there is no scope for return load as the industry is not developed here. Some bulk terminals can be set up in Delhi in the north and Chennai in south, where bulkers are coming from the cement plant can go back to the cement plant with fly ash. So, they are getting the two-way transportation. Bulkers are unloading the cement in the silos and there it is getting packed. In this mode, the transportation cost is reduced. But in North-East region, the roads are not good for bulkers to ply as it is hilly terrain. Also, cement consumption is very low here compared to other parts of the country. So, in North-East, the scope of bulk terminals is not feasible.?

Bulk transportation
According to Garg, bulk cement consumption and transportation at present in India is very low which is at a level of 10 per cent only. He says, ?Bulk transportation will increase at 15-20 per cent CAGR in future with consolidation in cement customer segment and growth of ready mix concrete business in India. At present, there is an issue both at the customer end and available logistics infrastructure, which is resulting in such a low bulk transportation percentage in India. This will further increase with introduction of new bulk terminals coming up near major consumption centres.? He adds, ?Now we are exploring the possibilities to use bulk silo placing unit attached to trucks and these small silos can be carried by trucks to the small construction site. With this concept, small construction site can be converted from bags to bulk. This will reduce the packaging and handling cost to a great extent.? Says Khurana, ?Bulk cement is used either in RMC or infra projects. But till date, the larger demand coming is from the rural pockets. Big projects like smart cities are at conceptual stage and if it becomes a reality then there is good scope for bulk cement. As of today, the percentage of loose cement sold in India is below 10 per cent of the total sales. The use of bulk cement is majorly at metro cities only. But going forward, if the projects like dedicated freight corridors, smart cities and other mega infra projects, come up, definitely there is a huge scope for bulk cement. If the future growth of cement comes to this segment then there is a huge growth.?

According to Ranjan, bulk transportation is good but there are a lot of technologies need to be developed like the bulk terminals, from where cement can be supplied to big projects. Now the RMC concept is evolved, and they have now started taking bulk cement, which saves costs involved in packing, packaging materials etc. The trend is gaining momentum as before starting big projects, they set up silos because they can set up a silo at 50 per cent production cost of cement and they can use loose cement. Almost every company has started this, especially for hydel projects they are using own silos. Now, NHPC has started this and many private companies are going to start. Even in road projects, bulk handling is going on.

Rail freight impact
According to Khurana, the 2.7 per cent increase in freight rate definitely adds to the cost of cement. He says, ?The input cost in terms of coal and slag transportation has increased almost 7 per cent, which adds to the cost of cement by Rs 2-2.50 per bag. So effectively, there will be a Rs 6-7 hike in per bag cost. But due to less demand in the current market, it is difficult to pass on the cost difference to the end-consumer. As of now, it is really hitting the bottom line of the cement company.?

Ranjan has a different take on this. According to him, freight rate is not a major factor in railway transportation. He says, ?More than freight rate, there are so many other factors that are affecting, which include other policies of Railways, infrastructure at rail yard, etc. Rail yards are working 24 hour, but the labours are available for only eight hours. Railways charges demurrage, if my rakes are getting placed today evening, I have to pay the demurrage charges for the whole night, and the labours will be available in the morning next day. Thus, demurrage charges, labour charges, local infrastructure charges, and other charges are so high which are diluting the increase of freight rates.?

Says Garg, ?Freight rate for cement has been hiked by 2.7 per cent whereas for coal this has been hiked by 6.3 per cent. This will have overall negative impact of around Rs 40 to 60/tonne on bottom line of cement industry. This freight hike by Railways will also impact the rail co-efficient as Railways has increased the freight at the time when diesel prices have come down drastically.?

On a positive angle, Shrivastava had this to say. ?In a growing vibrant economy like India, rise in input costs of variables such as rates, taxes, fuel costs have direct effect on the industry, but the overall advantage of the demand-supply fundamentals are still the more important opportunity for further growth and development. Any business has to be proactive to leverage the developments as well as innovate itself to make convert it into an opportunity.?

Setting up of bulk terminals
According to Garg, setting up of bulk terminals and same shared by different players will give a real boost to cement industry. He says, ?Any grinding unit or bulk cement terminal require at least 50 acre of land near to major cement consumption centres like Mumbai, Bangalore, Delhi, Kolkata, Chennai and upcoming metros. If we look at any of existing terminal (existing private siding or railway siding), there is a great scope of sharing existing private/railway siding and other available space in these terminals. This will be a win-win solution for the existing siding operator located nearby major consumption centres to collaborate and share their asset which is not fully utilised. Challenges are from regulation side also the modalities on sharing the existing set-up.?

Says Khurana, ?Collaborating with multiple companies will become challenging from the perspective of different players. Even today, industry has not graduated to a level where people only compete by way of brand. The industry has to reach that level of maturity where different manufacturers collaborate probably for the mutual benefit. Of course, looking at the Indian Railways to do those kinds of investments is not a scenario as of now. But there is a huge potential for private terminals, which are designed in such a way that they can be used as multiple operators rather than for a bagged cargo or loose cement cargo.

Says Dave, ?The future points to a shift towards bulk transport but that would happen gradually over 9 to 12 years horizon in big way once all the stake holders (from manufacturers to end users) are ready and fully on board. It also needs other enablers to be in place such as a shift in the way cement is sold (migration from B2C to B2B) and the availability of appropriate transportation, handling and infrastructure facilities.?

Integrated logistics
Says Khurana, ?In terms of operational aspect, one of the options available is the mechanisation of the goods shed and the second option is exploring the possibilities of bulk terminals across the country. Many big cement companies can explore upon setting up integrated terminals but for smaller players who have limited volumes and different geographies, this is not operationally viable. So there may be a potential for a common facility that can be utlised by different players and then repack and distribute to the local market from thereon. We have taken such initiatives for our white cement market due to longer distance from our plant in Rajasthan to the market in west coast and down south which is a multimodal type of operation. We have recently commissioned a grinder unit in Haryana which will reduce the load that goes into the road and rail network.?

Manufacturers tend to use a combination of distribution methods, which include bulk and bags via road, rail, in-land transport and by sea. The most inexpensive method of moving cement is in bulk by water. The optimum solution is always a combination of methods. In today?s technologically advanced world, it is possible to use the power of information technology to arrive at optimum solutions using mathematical modelling and algorithms. For effective and optimum costs in cement distribution, one needs to integrate IT solutions with actual demand and supply and, most importantly, include all options of cement movement and storage into the management cycle. One will need to work with almost everyone involved in the supply chain, from the drivers of road bulkers and trucks, the captains of the barges and ships and to the customer engineers who will finally receive the cement for use in their plants.

Shrivastava sums up, ?For the cement industry which includes home grown as well as international players competing for the market, one of the most important focus areas is to optimize the logistics value chain of the product which also included first and last mile transportation. Presently, movement of cement goes through multiple modes and service providers handling the product thus forming part of the overall logistics cost structure. One of the most efficient ways to control and leverage this variable is to look at integrated logistics wherein a provider has the network, the size and scale to provide all types of movement from coastal shipping to trailer movement to last mile distribution, thus forming a value added service. This will make a huge difference in terms of managing the value chain and optimizing costs as well delivery time of the product.?

LOGISTICS CHALLENGES IN NORTH-EAST

Logistics is the most important part in cement industry as almost 30 per cent of the cost of cement is involved in logistics. But it is more than that in the North-East part of the country. Since it is hilly terrain, transportation cost is very high which can be more than 40 per cent of the cement price. In this region, we have only one mode of transport, the road transport. There is no rail logistics here, except some parts of Assam.
Another bottleneck is the presence of anti-social elements in some parts of Nagaland, Manipur, and such north-eastern states. There are some parallel government system in Manipur, as we have to pay taxes at two points – one at Indian government and another at ?terror government?. This affects the final cost of the cement. For example, if the freight rate is Rs 100 at normal places in Assam, it will be same in these parts also for the same distance, but there are other taxes like token tax.
Apart from that, there is a convoy system here for transportation. If today there is no convoy if a truck is loaded, it may have to wait for a couple of day because convoy will go only on a particular day and all the trucks loaded with materials will be taken by the convoy up till Imphal, Agarthala, or such places. So these are the big bottlenecks, like if the truck is going, it is taking one week for a small distance of 200-300 km to go and come back. And the cost factor is coming at every stage which ultimately affects the final price of the cement and the customers.
As told by Prabhat Ranjan, AGM – Sales & Logistics, Meghalaya Cement

MOVING AHEAD

Coastal shipping will be a game changer for India
Bulk transportation will increase at 15 per cent to 20 per cent CAGR
Integrated logistics will make a huge difference in terms of managing the value chain
Rail logistics constitutes almost 35 per cent of the total dispatches being done from the factory

CHALLENGES

Availability of skilled drivers is a challenge in road transport
Costs of toll across highways and the low average speed of movement
Non availability of labours in rail yards
Demurrage charges from railway
Lack of rail wagons for small delivery for far-off destination, where road delivery is not feasible.

OPTIMISING LOGISTICS COST

Encourage big cement users for bulk/loose cement transport. This will reduce packing cost and is also eco-friendly. It is beneficial for both ? the seller and the buyer
Establish grinding units, blending or packing units in big market area for direct delivery of materials
Plan dispatches in a way that reduce rail freight/rail freight on return journeys availed for procurements
Maximise dispatches directly to the end user so that warehousing/distribution cost can be reduced
Optimise truck size/fleet capacity, timing of vehicle engaged in cement and raw material loading, unloading as well as the transit time, so that operational cost of vehicle is reduced by maximising efficiency of every trip made by the vehicle.

Concrete

The primary high-power applications are fans and mills

Published

2 weeks ago

October 10, 2025

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Alex Nazareth, Whole-time Director and CEO, Innomotics India, explains how plants can achieve both cost competitiveness and sustainability by lowering emissions, reducing downtime and planning for significant power savings.

As one of the most energy-intensive industries, cement manufacturing faces growing pressure to optimise power consumption, reduce emissions and improve operational reliability. Technology providers like Innomotics India are enabling this transformation by combining advanced motors, AI-driven digital solutions and intelligent monitoring systems that enhance process stability and reduce energy costs. From severe duty motors built for extreme kiln environments to DigiMine AI solutions that optimise pyro and mill operations, Alex Nazareth, Whole-time Director and CEO, Innomotics India, explains how the company is helping cement plants achieve measurable energy savings while moving closer to their sustainability goals.

How does your Energy Performance Contracting model typically reduce power consumption in cement plants—e.g., MWh saved?
Our artificial intelligence-based DigiMine AI Pyro and Mill solutions developed specifically for the cement industry, supports our customers in improving their process stability, productivity and process efficiency. In Pyro, this is achieved by optimising fuel consumption (Coal / AFR), reducing Specific Heat Consumption and reduction in emissions (CO2, SOx and NOx) through continuous monitoring of thermodynamics in pyro and recommending set-points of crucial parameters in advance for maintaining stable operations.
Within the mill, this is achieved by improving throughput, reduce energy / power consumption and maintaining stable operations on a continuous basis. Our ROI-based value proposition captures the project KPIs like reduction of coal usage, increase of AFR, reduction of specific heat consumption (Kcal / Kg), reduction of specific power consumption (KWH / tonne), reduction of emissions, etc., by a specific percentage. This gives clarity to our customers to understand the investment vis-à-vis savings and estimate the recovery time of their investment, which typically is achieved within one year of DigiMine AI Pyro and Mill solutions implementation.

What role do digitalisation and motor monitoring play in overall plant energy optimisation?
Motors are being used extensively in cement production, and their monitoring play crucial role in ensuring continuous operation of applications. The monitoring system can automatically generate alerts for any anomaly / abnormalities in motor parameters, which allows plant team to take corrective actions and avoid any major equipment damage and breakdown. The alerts help maintenance team to plan maintenance schedule and related activity efficiently. Centralised and organised data gives overview to the engineers for day-to-day activities. Cement is amongst the top energy intensive industries in comparison to other industries. Hence, it becomes critically important to optimise efficiency, productivity and up-time of plant equipment. Motor monitoring and digitalisation plays a vital role in it. Monitoring and control of multiple applications and areas
within the plant or multiple plants becomes possible with digitalisation.
Digitalisation adds a layer on top of OT systems, bringing machine and process data onto a single interface. This solves the challenges such as system silo, different communications protocol, databases and most importantly, creates a common definition and measurement to plant KPIs. Relevant stakeholders, such as engineers, head of departments and plant heads, can see accurate information, analyse it and make better decisions with appropriate timing. In doing so, plant teams can take proactive actions before machine breakdown, enable better coordination during maintenance activities while improving operational efficiency and productivity.
Further using latest technologies like Artificial Intelligence can even assist operators in running their plant with minimal requirement of human intervention, which allows operators to utilise their time in focusing on more critical topics like analysing data to identify further improvements in operation.

Which of your high-efficiency IEC low-voltage motors deliver the best energy savings for cement mills or fans?
Innomotics India offers a range of IEC-compliant low-voltage motors engineered to deliver superior performance and energy savings, particularly for applications such as cement mills, large fans, and blowers. Innomotics has the complete range of IE4 motors from 0.37kW to 1000kW to meet the demands of cement industry. The IE5 range is also available for specific requirements.

Can safe area motors operate safely and efficiently in cement kiln environments?
Yes, safe area motors are designed to operate reliably in these environments without the risk of overheating. These motors have ingress protection that prevents dust, moisture ingress and can withstand mechanical stress. These motors are available in IE3 / IE4 efficiency classes thereby ensuring lower energy consumption during continuous operation. These motors comply with relevant Indian as well as international standards.

How do your SD Severe Duty motors contribute to lower emissions and lower cost in heavy duty cement applications?
Severe duty motors enhances energy efficiency and durability in demanding cement applications, directly contributing to lower emissions and operational costs. With high-efficiency ratings (such as IE3 or better), they reduce power consumption, minimising CO2 output from energy use. Their robust design handles extreme heat, dust and vibration—common in cement environments—ensuring reliable performance and fewer energy losses.
These motors also lower the total cost of ownership by reducing downtime, maintenance and replacement frequency. Their extended service life and minimal performance degradation help cement plants meet sustainability targets, comply with emissions regulations and improve overall energy management—all while keeping production consistent and cost-effective.

What pump, fan or compressor drive upgrades have shown approximately 60 per cent energy savings in industrial settings and can be replicated in cement plants?
In the cement industry, the primary high-power applications are fans and mills. Among these, fans have the greatest potential for energy savings. Examples, the pre-heater fan, bag house fan, and cooler fans. When there are variations in airflow or the need to maintain a constant pressure in a process, using a variable speed drive (VSD) system is a more effective option for starting and controlling these fans. This adaptive approach can lead to significant energy savings. For instance, vanes and dampers can remain open while the variable frequency drive and motor system manage airflow regulation efficiently.

Concrete

We conduct regular internal energy audits

Published

2 weeks ago

October 10, 2025

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Shaping the future of low-carbon cement production involves integrating renewables, digitalisation and innovative technologies. Uma Suryam, SVP and Head Manufacturing – Northern Region, Nuvoco Vistas, gives us a detailed account of how.

In an industry where energy consumption can account for a significant portion of operating costs, cement manufacturers are under increasing pressure to adopt sustainable practices without compromising efficiency. Nuvoco Vistas has taken a decisive step in this direction, leveraging digitalisation, renewable energy and innovative technologies to drive energy efficiency across its operations. In this exclusive conversation, Uma Suryam, SVP and Head Manufacturing – Northern Region, Nuvoco Vistas, shares its approach to energy management, challenges of modernising brownfield plants and its long-term roadmap to align efficiency with India’s net-zero vision.

How has your company improved energy efficiency over the past five years?
Over the past five years, we have prioritised energy conservation by enhancing operational efficiency and scaling up renewable energy adoption. Through strategic fuel mix optimisation, deployment of cleaner technologies, and greater integration of renewables, we have steadily reduced our environmental footprint while meeting energy needs sustainably.
Technological upgrades across our plants have further strengthened efficiency. These include advanced process control systems, enhanced trend analysis, grinding media optimisation and the integration of solar-powered utilities. Importantly, grid integration at our key plants has delivered significant cost savings and streamlined energy management.
A notable milestone has been the expansion of our solar power capacity and Waste Heat Recovery Systems (WHRS). Our solar power capacity has grown from 1.5 MW in FY 2021–22 to 5.5 MW, while our WHRS capacity has increased from 44.7 MW to 49 MW, underscoring our commitment to sustainable energy solutions.

What technologies or practices have shown the highest energy-saving potential in cement production?
One of our most significant achievements in advancing energy efficiency has been the successful commissioning of a 132 KV Grid Integration Project, which unified three of our major manufacturing units under a single power network. This milestone, enabled by a dedicated transmission line and a state-of-the-art Line-In Line-Out (LILO) substation, has transformed our energy management and operational capabilities.
With this integration, we have substantially reduced our contract demand, eliminated power disruptions, and enhanced operational continuity. Supported by an optical fibre network for real-time communication and automation, this project stands as a testament to our innovation-led manufacturing excellence and underscores Nuvoco’s vision of building a safer, smarter, and sustainable world.

What role does digitalisation play in achieving energy efficiency in your operations?
Digitalisation plays a transformative role in driving energy efficiency across our operations. At Nuvoco, we are leveraging cutting-edge technologies and advanced digital tools to enhance productivity, optimise energy consumption and strengthen our commitment to sustainability and employee safety.
We are developing AI-enabled dashboards to optimise WHRS and kiln operations, ensuring maximum efficiency. Additionally, our advanced AI models evaluate multiple operational parameters — including fuel pricing, moisture content and energy output — to identify the most cost-effective fuel combinations in real time. These initiatives are enabling data-driven decision-making, improving operational excellence and reducing our environmental footprint.

What is your long-term strategy for aligning energy efficiency with decarbonisation goals?
As part of India’s climate action agenda, the cement sector has laid out a clear decarbonisation roadmap to achieve net-zero CO2 emissions by 2070. At Nuvoco, we view this as both a responsibility and an opportunity to redefine the future of sustainable construction. Our long-term strategy focuses on aligning energy efficiency with decarbonisation goals by embracing innovative technologies, alternative raw materials and renewable energy solutions.
We are making strategic investments to scale up solar power installations and enhance our renewable energy mix significantly by 2028. These initiatives are a key part of our broader vision to reduce Scope 2 emissions and strengthen our contribution to India’s net-zero journey, while continuing to deliver innovative and sustainable solutions to our customers.

How do you measure and benchmark energy performance across different plants?
We adopt a comprehensive approach to measure and benchmark energy performance across our plants. Key metrics include Specific Heat Consumption (kCal/kg of clinker) and Specific Power Consumption (kWh/tonne of cement), which are continuously tracked against Best Available Technology (BAT) benchmarks, industry peers and global standards such as the WBCSD-CSI and CII benchmarks.
To ensure consistency and drive improvements, we conduct regular internal energy audits, leverage real-time dashboards and implement robust KPI tracking systems. These tools enable us to compare performance across plants effectively, identify optimisation opportunities and set actionable targets for energy efficiency and sustainability.

What are the key challenges in adopting energy-efficient equipment in brownfield cement plants?
Adopting energy-efficient technologies in brownfield cement plants presents a unique set of challenges due to the constraints of working within existing infrastructure. Firstly, the high capital expenditure and relatively long payback periods often require careful evaluation before investments are made. Additionally, integrating new technologies with legacy equipment can be complex, requiring significant customisation to ensure seamless compatibility and performance.
Another major challenge is minimising production disruptions during installation. Since brownfield plants are already operational, upgrades must be planned meticulously to avoid affecting output. In many cases, space constraints in older facilities add to the difficulty of accommodating advanced equipment without compromising existing layouts.
At Nuvoco, we address these challenges through a phased implementation approach, detailed project planning and by fostering a culture of innovation and collaboration across our plants. This helps us balance operational continuity with our commitment to driving energy efficiency and sustainability.

Concrete

Digitalisation is pivotal in driving energy efficiency

Published

2 weeks ago

October 10, 2025

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As energy costs continue to dominate the cement industry, efficiency and sustainability are proving to be vital components. MM Rathi, Joint President, Power Management, Shree Cement, explains the company’s long-term strategy is focused on cutting emissions while powering growth with renewable energy solutions.

Energy efficiency has always been a cost-saving lever for the cement industry. Today, it is the backbone of sustainability and competitiveness. Cement manufacturers are under growing pressure to optimise consumption, diversify power sources and align with decarbonisation targets. Shree Cement has been at the forefront of this transformation, significantly scaling up its green power capacity and embedding advanced technologies across operations. In this exclusive conversation, MM Rathi, Joint President – Power Management, Shree Cement, shares insights on the company’s approach to energy efficiency, challenges in brownfield modernisation and long-term strategies for achieving net zero alignment.

What percentage of your total operational cost is attributed to energy consumption?
At Shree Cement, energy is one of the most significant components of production cost, accounting for nearly 30 per cent to 40 per cent of total operational expenses. Within this, thermal energy typically contributes around 20 per cent to 25 per cent, while electrical energy forms about 10 per cent to 15 per cent. The exact share varies depending on factors such as the fuel mix (coal, pet coke or alternative fuels and raw materials), the power source (grid-based or captive like solar, wind or thermal), raw mix quality, and regional fuel and electricity price variations. This makes energy efficiency and the adoption of sustainable power sources a key focus area, both from a cost and sustainability perspective.

How has your company improved energy efficiency over the past five years?
Over the past five years, Shree Cement has consistently invested in enhancing energy efficiency across operations. Our green power capacity, covering wind, solar and Waste Heat Recovery (WHR), has more than doubled from 245 MW in 2020 to 592 MW in 2025. All grinding units are now equipped with biomass firing facilities, reducing dependence on conventional fuels. From the project stage itself, we prioritise efficiency by selecting advanced technologies such as six-stage kilns with integrated WHR, CFD-designed plants, and equipment fitted with VFDs, centrifugal compressors and high-efficiency fans. We also review and upgrade equipment systematically, replacing fans, compressors, blowers, pumps, boilers and turbines with more efficient options. This continuous approach has reduced costs while significantly advancing our sustainability journey.
What technologies or practices have shown the highest energy-saving potential in cement production?
WHR stands out as one of the most effective solutions, offsetting a significant portion of electricity required for clinker production. Hot air recirculation has also proven highly beneficial in reducing heat losses. Additionally, regular energy audits help us identify opportunities for improvement and implement corrective measures in daily operations. Together, these practices play a critical role in optimising energy efficiency and driving sustainable operations.

What are the key challenges in adopting energy-efficient equipment in brownfield cement plants?
The biggest challenge is the significant upfront investment required for upgradation. Retrofitting existing facilities often involves complex civil and structural modifications, which add costs and extend downtime. Integration is another hurdle, as new high-efficiency equipment may not align seamlessly with older kiln systems, fans, mills or automation setups. These factors make the transition in brownfield plants more resource-intensive and time-consuming compared to greenfield projects.

How do you measure and benchmark energy performance across different plants?
We track key performance indicators such as specific heat consumption and specific power consumption for each unit, benchmarking them against internal and external standards. Thermal Substitution Rate (TSR percentage) is another critical metric, measuring the share of alternative fuels in the thermal energy mix. Internally, we benchmark performance across plants to encourage best practice sharing. Externally, we compare against national averages and align with the Bureau of Energy Efficiency’s PAT (Perform, Achieve, Trade) scheme, which sets Specific Energy Consumption (SEC) baselines and targets for cement plants. This multi-layered approach ensures continuous monitoring, improvement, and industry leadership in energy efficiency.

What role does digitalisation play in achieving energy efficiency in your operations?
Digitalisation is pivotal in driving energy efficiency at Shree Cement. IoT sensors integrated with SCADA and DCS systems allow real-time monitoring of parameters like heat consumption and energy use, moving beyond periodic reports. Our digital platforms consolidate plant data, enabling management to compare metrics such as SPC, SHC, kWh per tonne and kcal per kg across units in real time. This visibility supports data-driven decisions, faster corrective actions, and higher operational efficiency.

How do government policies and incentives influence your energy-saving decisions?
Government policies and incentives strongly shape our energy-saving decisions. The Perform, Achieve, Trade (PAT) scheme sets plant-specific SEC targets. Non-compliance incurs penalties, while compliance earns tradable energy-saving certificates. This ensures energy efficiency is both cost-driven and regulatory. Additionally, subsidies and viability gap funding for renewable energy projects in wind, solar and AFR co-processing help reduce payback periods and make energy-saving investments more viable.

What is your long-term strategy for aligning energy efficiency with decarbonisation goals?
Our long-term strategy aligns energy efficiency with India’s net zero 2070 goals. Key levers include improving efficiency, expanding green electricity, producing more blended cement, and increasing alternative fuel use. Today, more than 60 per cent of our electricity comes from green sources such as solar, wind, and WHR, the highest in India’s cement industry. Our blended cement products, which reduce limestone and fuel consumption, further lower emissions. These products are certified under the GreenPro ecolabel by CII, validating our sustainability practices and environmental standards.