Cement Americas International Editor Jonathan Rowland Spoke to Ian Riley, CEO of the World Cement Association, About the Challenge of Creating a Sustainable Cement Industry and the Role China and India are Playing in the Solution.
By Jonathan Rowland
|Ian Riley leads the World Cement Association in its mission to help the cement industry meet its sustainability obligations.|
|Anhui Conch has pioneered research into carbon capture in China at its Wuhu plant.|
|Cement companies can work to increase waning biodiversity during quarry restoration, as at Asia Cement’s Hualian plant.|
|The WCA is focused on achieving a sustainable cement industry by facilitating networking and knowledge exchange, such as at its WCA World Cement Conference, which last year was held in Shanghai.|
Sustainability, carbon neutrality, carbon capture, net-zero emissions … these buzzwords are familiar in conversations within the cement industry. But while technology development is progressing well, the industry is far from united it its progress on the sustainability journey. Getting all to walk the sustainability walk will require a shift in the way society as a whole views CO2 and invests in the industries that produce it, as Ian Riley, CEO of the World Cement Association (WCA), told Cement Americas in a recent interview.1
Carbon Capture … Then What?
Take carbon capture. The technology is fast progressing to commercial scale deployment. 1 But challenges to its roll-out remain. According to Riley, they break down into two linked issues. The first is what do you do with the CO2 that is captured (and if carbon capture is ever installed industrywide, there will be a lot of it, not just from the cement sector, but other carbon-intensive industries). The second is how to motivate the industry to move to1gether to adopt the technology.
Classically, the question of what to do with captured CO2 is to bury it. “There are two problems with storing CO2,” Riley explained. One is simple geology: “You have to have the right geological formations in which to store the CO2 and these are geographically limited.”
The second question goes to the heart of the carbon capture challenge: the economics. “If you are simply storing the carbon – essentially treating it as a value-less waste product to be disposed of - you’re not getting any value for it.” Carbon capture is expensive. To make the economics of storage make sense, the cost of emitting carbon much be higher than the cost of capturing it. The usual method proposed to achieve this is some form of carbon tax.
The alternative is to change the paradigm: to view CO2 not as a dangerous waste product to be contained but a valuable resource that can bring commercial value to a company. The value of the carbon can then be offset against the cost of its capture. Although that offset may not be complete, requiring some form of carbon pricing to ensure the cost of emitting remains the more expensive option, that carbon pricing would be less punitive. Importantly, companies would see economic value from the process, whereas with storage, it is pure cost.
“If you look at the usage side, there is now talk of creating a carbon-based economy, similar to the hydrocarbon economy, where you take the carbon to manufacture a range of other products,” Riley said. “I think we’re still very early into that type of development, but we can see its potential in for example the use of CO2 to manufacture artificial aggregates. There are companies working on this around the world and it shows that the idea of a carbon economy could have merit.”
One such company is Blue Planet in California,2 which manufactures synthetic aggregate from CO2 to use in place of natural limestone. In the Blue Planet process, CO2 from flue gas (in this case from the Moss Landing gas-fired power plant) is converted to carbonate (CO3) by filtering it through a water-based capture solution. The carbonated solutions that is formed is then used to form a carbonate mineral (or artificial limestone) coating over a nucleus or substrate of recycled aggregate, permanently capturing the CO2.
The Times, They Are A-Changin’
Such demonstrations of the commercial utility of carbon (and therefore carbon capture) will be a key answer to the second challenge, that of bringing the whole industry – not just those forward-thinking companies that have already begun – on the journey to sustainability. “The global cement industry is in period of a transition. Some companies have accepted the need to decarbonise the industry. They are looking forward to 2050 and trying to think about how the industry can comply with the Paris Accord; others still need persuading.”
And that persuasion is important as it must be a collective journey: “while emitting the CO2 continues to be an option, the companies that want to do things differently will struggle. There is so much CO2 generated in the cement production process, if you’re not getting some benefit from capturing it, then you’re at a tremendous disadvantage to competitors who are just releasing it.”
Regulation will need to play a role here. But as Bob Dylan sang, the times, they are a-changin’. If one paradigm shift is needed (and is slowly coming) in the way we view carbon not as a dangerous waste product but valuable byproduct, another (coming more quickly) is in the way investors and other stakeholders view the viability of companies – particularly those that may be dragging their feet on their sustainability journey.
“Worldwide understanding of the challenge is growing rapidly and I think that will precipitate very significant changes,” said Riley. “We are also seeing changes in investor’s attitudes to companies over the timeframes of their investment. Over the course of an investment, the politics and economics of climate change could change significantly. Investors are increasingly wanting to know that the companies in which they are putting their money are future-proofed against these risks.”
What About the Politics?
No discussion of climate change and the forces involved in decarbonizing vast swathes of the economy would be complete without mentioning the politics – or would it?
“Discussion of climate change in China is very different to that in the U.S. or, to a lesser extent, Europe because it’s not been politicized in the same way. China has never had climate activism. In China, it is a technical issue seen within the Chinese context, where the impacts of climate change are having a significant effect. Water shortages – common in the north of the country – are now spreading south, where the rivers are running low because the glaciers that feed them have shrunk to such a large extent.”
Across the Himalayas “the situation in India is a lot worse,” Riley continued. “This is why Chinese and Indian companies are now quite progressive about trying to tackle climate change. For example, China’s largest cement company, CNBM, recognizes that emissions must be pretty much eliminated and that that is the task for the next 30 years. Similarly, India’s Dalmia Cement has announced that is wants to achieve net zero emissions by 2040.”
These two giant Asian economies account for about two-thirds of global cement production. And with scale comes expertise: both countries “have many engineers involved in the industry, with a lot of technical competence. As a result, it is likely we will see innovations coming increasingly from both China and India.”
China and India’s leadership role also stretches beyond their significant domestic industries. “Look at Africa, where you’re going to see a large number of new plants built over the next 10 to 20 years,” Riley said. “I think it’s almost impossible for Western companies to compete with Chinese companies there. The cost structures, their capital costs, they’re just too different. I would see Africa being largely Chinese and local players, perhaps some Indian too. The Western multinationals will find it extremely difficult to compete.”
Better by Association
Riley joined the WCA in 2019 from LafargeHolcim, where he most recently worked in China as Country Head, after stints in Europe, America, and Asia. Still a fairly new organization (the WCA was only founded in 2016), it has taken up climate change as its key mission – a mission that will continue under Riley’s watch.
“The overwhelming issue is how we respond to climate change. As an association, we see that as our key focus. Our key objective is to accelerate the response to climate change. We do this through facilitating or enhancing knowledge sharing via member forums on particular topics to help spread best practice.”
“We also want to help the industry both evaluate and scale up new technologies, particularly carbon usage technologies, that are coming from outside of the industry. I see one of the roles of a global association as connecting the companies who have the technologies with the companies that would be able to scale them up quickly. Our vision is to play a role in accelerating that.”
Although dominating the agenda, however, there are issues beyond climate change that Riley is also keen for the WCA to address, including water usage and biodiversity.
“If you look at areas such as Western Europe, biodiversity is very low, much lower than it would have been in the past, as a result of large-scale farming over many years. There is a real opportunity for the cement industry to make an impact here, for example when it comes to rehabilitating quarries. With a bit of thought – such as planting rare native species – quarry restoration can become a tool to enhance biodiversity.”
The challenges the cement industry faces over the next few years are substantial – but there now appears to be a growing appetite for collective action to overcome these. And with Riley at the helm, the WCA is set to play a central role in facilitating this conversation, pushing the industry forwards towards into a more sustainable – both in environmental and economic – future.
2. Rowland, J., ‘At the Cutting Edge’, Cement Americas (Fall 2019), pp. 30 – 34.