Widespread adoption of waste heat recovery (WHR) systems could drive substantial reductions in carbon and greenhouse gas (GHG) emissions for cement manufacturers, according to a recently released report from the International Finance Corp. (IFC) and the Institute for Industrial Productivity (IIP).
The predominant building material of our times, cement manufacturing requires an inordinate of energy. It also produces an inordinate amount of carbon dioxide and other pollutants. It is estimated that cement manufacturing alone accounts for 5 percent of anthropogenic carbon dioxide (CO2) emissions globally.
Prodded by environmental NGOs and government regulatory agencies, cement manufacturers have been on a drive to reduce their CO2 emissions, and they’ve made significant progress. Looking to add to them, installation of WHR systems “can reduce the operating costs and improve EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) margins of cement manufacturers some 10-15 percent. According to IFC-IIP’s “Waste Heat Recovery for the Cement Sector: Market and Supplier Analysis” report.
Cement and CO2 emissions
Some 3.6 billion metric tons of cement were produced worldwide in 2011, resulting in over 2 billion metric tons of CO2 emissions. That counts the emissions from calcination of limestone, the resulting intermediate stage product known as “clinker,” as well CO2 emissions from the fuels used (mainly coal and gas) to drive the process.
Cement manufacturers have leveraged energy efficiency, alternative fuels or biofuels, and clinker substitution to realize a 16 percent reduction in CO2 missions per metric ton of cement produced from a level of 750 kilograms (kg) CO2 per metric ton, according to the Global CCS (Carbon Capture & Storage) Institute.
Waste heat recovery: Factors for success
From their analysis of cement manufacturing across 11 developing countries, IFC and IIP conclude that WHR technology can be the key for cement manufacturers to realize greater reductions in CO2 emissions, as well as lower operating costs, enhance the security of electricity supplies and improve their market competitiveness.
In “Waste Heat Recovery for the Cement Sector: Market and Supplier Analysis,” IFC and IIP analyze “the current state of WHR technology deployment in developing countries and investigates the success factors in countries where WHR has become widely spread.” The study covers national cement industry sectors spanning 11 nations: Nigeria and South Africa, India and Pakistan, Egypt and Turkey, Brazil and Mexico, and in East Asia, Philippines, Thailand and Vietnam.
As the report authors recount, Japanese companies spearheaded the introduction of WHR systems in the cement industry back in the 1980s. WHR technology has improved, diversified and been adopted more widely since. There are over 850 WHR power installations worldwide at present, according to IFC-IIP’s count. China, with 739, has the most by far, followed by India, with 26, and Japan, with 24.
Looking to identify the factors that have led to WHR’s success in China, the IFC-IIP research team found that a combination of incentives has led to greater adoption. These include tax breaks and revenue generated from the issuance and sales of UN Clean Development Mechanism (CDM) carbon offset credits for clean technology projects.
Also contributing has been the January 2011 enactment of national energy efficiency legislation that required use of WHR on all new clinker lines. Clinker is an intermediate product in the manufacture of cement that is produced when limestone is heated. Heating limestone drives a chemical reaction that releases CO2.
Reinforcing these initiatives, private sector Chinese companies began entering the market. Their entering the market and use of domestic design resources and components drove the capital and installation costs of WHR, the report authors highlight.
Benefits of cement waste heat recovery (WHR)
Electricity bills typically make up as much as 25 percent of a cement factory’s total operating costs. Installing WHR systems enables manufacturers to capture heat and make use of heat that otherwise would have been vented to the atmosphere and surrounding environment. IFC and IIP found that cement manufacturers can capture these exhaust gases and use them directly for low-temperature heating, or use them to generate as much as 30 percent of overall cement factory electricity needs.
By deploying WHR-based electricity generation, cement factories not only reduce their purchases from power companies or other in-house electricity sources, it insulates them from volatility in electricity market prices. Furthermore, deploying WHR technology enhances power reliability and improves the plant’s overall market competitiveness.
IFC and IIP estimate the potential exists to deploy 1,615 megawatts (MW) and 2,930 MW of WHR across the 11 developing countries surveyed. Improved access to financing would be a key enabler. As the report authors state:
“Cement manufacturers are frequently reluctant to put WHR investments on their balance sheets, especially when project payback period is over two years. While experience with off-balance sheet financing is limited to date, it offers great opportunities for further uptake of WHR.”
All images credit: IFC, IIP, “Waste Heat Recovery for the Cement Sector: Market and Supplier Analysis”