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Late monsoon adds to manufacturers woes

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Steep rise in prices over four months’ span have tapered off demand. Further price hikes face challenges like delayed monsoon and allegations of cartelisation of cement manufacturers.

The all India cement prices have eased in June 2019 in line with the expectations of the cement industry value chain last month based on some pressure points developing against the steep rise in prices seen since March 2019. Channel checks suggested that all-India cement prices have declined by 2 per cent month-on-month (m-o-m) to Rs 361/bag in June 2019 versus Rs 368/bag in May, in the first half of the month, though the fall has moderated by month-end.

The fall in prices was predicted by analysts taking cue from falling demand due to higher prices and dealers offering discounts to push their products. With sharp 8 per cent Month-on-Month (MoM or compared to the previous month) hike pan-India in April, average trade prices in April-June were up by 11 per cent Quarter-on-Quarter (QoQ).

The ET Cement Index that tracks cement price movements across the country was down by 1.39 per cent to 2397.3 points by end-June 2019 from 2431.1 points in end-May 2019, ending the four months of rising streak. With the government announcing that it will probe into builders’ allegations of cartelisation of cement manufacturers resulting price rise, the scope price hikes by cement manufacturers has been capped in the months to come. Irregular monsoon is also threatening to affect cement demand, particularly in rural areas where incomes of people are linked to agriculture production.

After six strong quarters of growth in demand for cement, a proxy for construction activity in the economy, it is set to see a sharp drop of 500 basis points (bps) to 3-5 per cent in the first quarter of this financial year, against a 9-10 per cent rise in the January-March quarter of 2018-19, according to rating agency Crisil, based on a survey of 250 dealers and others stakeholders across cement value chain.

The sentiment score at the pan-India level for the next two quarters fell to 5.5 from the previous quarter’s 6.0, Crisil said. The survey measures the outlook on construction growth over the next two rolling quarters on a scale of 1 to 10, where 1 indicates a major decline and 10 indicates a robust rise (on a year-on-year or YoY basis).

Demand downturn
Crisil attributed the sudden downturn in demand to a slowdown in construction activity ahead of the general elections, labour shortage and delayed release of funds by the government. The report also found that a Rs 50-60 per bag increase in the price of cement in the January-March quarter weighed on housing demand as well. "There is a ray of hope as experts expect an upturn in demand from the third quarter, that is, post monsoon," rating agency ICRA said in a report. In April 2019, cement production at 28.7 million MT is lower by 13.3 per cent on an MoM basis. "ICRA expects cement demand growth to taper in FY2020 to around 7 per cent from a double digit growth of 13 per cent in the previous year. The demand has been tepid in Q1 FY2020 (April-June 2019 quarter) due to slowing of project execution on account of general elections (usually resulting in labour unavailability). In Q2 FY2020, the consumption is expected to be on lower side owing to the monsoon season. Hence, ICRA expects the demand to pick up in Q3 FY2020 (October-December 2019 quarter)," said Sabyasachi Majumdar, Senior Vice President & Group Head, Corporate Ratings, ICRA.

Industry volumes increased by one per cent YoY to 28.7 MT in April 2019 after registering 12 per cent YoY growth in 4QFY19 and 13 per cent YoY growth in FY2019, according to the data released by the Department of Industrial Policy and Promotion (DIPP) of the Centre. The strong growth in FY2019 was led by the government’s housing schemes and infrastructure demand, it added.

Cartelisation allegations
Recently, the government has stated in parliament that the Competition Commission of India (CCI) is examining complaints regarding hike in cement prices and cartelisation by companies. This initiative was taken up based on complaints from property and infrastructure builders and contractors, particularly those involved in building roads and highways.

The housing and real estate sector is the largest consumer of cement, accounting for about 65 per cent of the total consumption, followed by public infrastructure at 20 per cent and industrial development at 15 per cent.

Delay in monsoon
The progress of south-west monsoon in June 2019 (from 1 June 2019 to 26 June’19) has been slow with 31 meteorological sub-divisions out of 36 recording deficient or scanty rainfall, which has been the highest in the previous six years. During this period, there has been a significant deviation of 36 per cent from the normal rainfall. The rainfall so far has been scanty over central and western regions, according to Indian Meteorological Department data.

The live storage level in the 91 reservoirs across the country as on June 27, 2019 was 26 BCM, recording a contraction of (-) 11.7 per cent than the corresponding period previous year. The current live storage level of the reservoirs at 16.2 per cent of the full storage level, is lower than the 10-year average live storage, which is 19 per cent.

"A slow progress in monsoon, along with storage levels of reservoirs remaining below the 10 year average during June 2019, could affect the sowing patterns and in turn the crop production in the country.

The monsoon patterns need to be closely monitored going ahead as it has an important bearing on food price inflation and the contribution of agriculture to the overall economy," said CARE Ratings in its recent report. Rural economy’s prospects are linked to monsoon, which is the main source of increasing agricultural production. When rural incomes rise it will impact cement demand positively, along with demand for other commodities. As the monsoon season extends till September every year, one has to wait for the temporal and spatial spread of monsoon to arrive at a conclusion on agriculture productivity during the fiscal.

– BS SRINIVASALU REDDY

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Concrete

The primary high-power applications are fans and mills

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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.

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Concrete

We conduct regular internal energy audits

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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.

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Concrete

Digitalisation is pivotal in driving energy efficiency

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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.

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