Storming ahead

Much has been written concerning current events, with the new reality of war in Europe, and a summer where ‘Mother Nature’ has decided to pack an extra punch with extreme weather events troubling many countries in Europe and the rest of the world. The growing negative impacts of global warming have been further compounded by the after effects of Covid-19 and the recent war in Ukraine. The combined effect of these factors has resulted in the following changes:

• Rapidly increasing energy prices.
• Ballooning CO₂ permit pricing under the European Union Emission Trading Scheme (EUETS).
• Supply chain stresses resulting in higher transport costs.

The above factors have therefore forced society, especially major energy consuming industries (including cement manufacture), to closely examine their approach to low-carbon processes and cheaper energy. Indeed, this energy dependency reassessment has become a global governmental issue.

Therefore, it is clear that a truly global energy transition has begun.

But what does this mean for alternative fuels? Are alternative fuel supply chains adversely affected by war and drought, or is the market flexible enough to deal with these events? The cement industry is an interesting case study in trying to understand the current dynamics at play amongst the major energy consuming industries. The main options the cement industry has to mitigate the current position are as follows:

• Become more energy efficient – generally speaking, only small improvements can currently be made to existing modern processes. So only small benefits can be reaped using this approach.
• Use low-carbon alternative raw material sources – whilst offering tremendous benefits, the volumes of new raw material feed streams required are huge and so supply chain risks are high.
• Using clinker substitutes in making finished cement – again large benefits could result from this approach but market caution in using such cements could be restrictive.
• Adopting carbon, capture and storage technology (CCS) – again, the potential benefits are significant, but this new technology is expensive to develop and as yet it is not fully proven at commercial scale.
• Drawing power from zero carbon sources i.e. solar, wind, and hydro – three excellent solutions, but all require significant capital investment.
• This leaves the use of high biomass alternative fuel – the solution exists, has been proven on a fully commercial scale and will provide good savings in terms of direct fossil fuel CO₂ generation.

The adoption of alternative fuels is gathering even further momentum in not only the cement industry but also within other major energy consuming sectors. This change in momentum and the change in energy and transport costs has moved the value of alternative fuel to a point where a high grade fuel can no longer be delivered with a gate fee. The situation has now arrived where ‘the consumer pays’ for the fuel with all non-cement consumers now reconciled to this fact. It is worth noting that the other industries now fighting for this fuel include:

• Power generation
• Steel
• Lime
• Other novel uses

The global industrial response to this ‘perfect storm’ has been inspiring, with the cement industry once again leading the way. Over recent years there has been a division in the cement industry in Europe where certain regions have seen cement plants pushing for thermal substitution rates (TSR) of 80% and more, with some plants hitting 100% TSR at certain times.

Other regions are now beginning to follow this lead, with a race now developing to achieve high TSRs and secure the supply of high grade fuel. Within Europe a major driver for such action is the commercial impact of CO₂ prices under the EU Emissions Trading Scheme (EUETS). However, the same push for higher alternative fuel consumption is now being seen outside the EUETS area as the rest of the cement industry can see the direction of travel in terms of energy cost and environmental impact. In these non-EUETS regions it is often the case that the local waste management industry is weak and so the import of alternative fuels from other regions is considered a legitimate option. N+P support this strategy with the initial importation being considered as a means of testing the ability of the plant in question to burn the new alternative fuel. The next step is to explore the possibility of gathering and processing local waste to manufacture domestic-based alternative fuels.

As previously mentioned, other industries are developing strategies to utilise alternative fuels and waste-derived material to produce novel products. One example is the lime industry which N+P is now involved in supplying. Lime plants have a more demanding fuel specification than cement plants, but N+P is very enthusiastic about satisfying the demands of this sector. In addition, new technologies are being developed which require a high grade waste-derived feedstock. One example is the sustainable aviation fuel sector (SAF) where ambitious plans are now being developed to produce an environmentally benign aviation fuel. Again N+P are involved in this sector with a number of strategic partners. These developments demonstrate the broad approach being taken by N+P in this ever growing sector. But the examples given here further reveal the pressure that is coming to bear on the available feedstock. This, linked with the global efforts to reduce rising waste volumes clearly puts pressure on the economics of the alternative fuel market.

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Read the article online at: https://www.worldcement.com/special-reports/14122022/storming-ahead/