The fuels of the future

The cement industry is ahead of many of its rivals when it comes to embracing alternative fuels, but with doubts over the longevity of gate fees for taking Europe’s shredded waste, the challenge is now maintaining that progress. Regulation, political pressure, changing social values and carbon tax implications are driving a desire for manufacturers and high energy users to consider more renewable fuel sources, with the climate agenda becoming ever more dominant.

The good news for the cement industry is that it is already less reliant on traditional fuels, (such as coal, gas or petcoke) than many other sectors, because it embraced burning waste as an alternative long ago – especially within the European Union.

Current estimates suggest that anywhere between 30 – 40% of the fuel used in the sector in Europe is waste-derived, taking advantage of the continent’s mature waste industry which is willing to pay businesses to take waste that would otherwise be diverted to landfill.

These companies can do this because of the EU’s high landfill taxes, which encourage the waste industry to find alternative uses for waste rather than putting it in the ground.

At present, the system works well – especially because landfill taxes in countries such as France and Italy have rocketed – but there is a problem on the horizon.

Few people believe the situation is sustainable in the long term because, as the world becomes more efficient at dealing with waste and finds alternative uses for it, the intrinsic value of raw or shredded waste will rise – it will become a valuable commodity in its own right.

This means the days of the cement industry being paid significant sums to take waste-derived fuel cannot continue forever. As waste begins to be seen as a commodity, the cement industry is going to have to pay for it – and that could happen within the next two or three years.

The big question, then, is what is the future fuel of the cement industry?

Does it return to coal use or continue to use shredded waste with its growing costs? Or perhaps the industry needs to explore new alternatives?

Returning to a total reliance on coal is a no-go considering the potential environmental impact of such a switch.

The influence of the European Union’s Emissions Trading Scheme, a key tool for reducing greenhouse gas emissions and the world’s biggest carbon market, is important, too.

The scheme limits emissions in heavy industry and works on the ‘cap and trade’ principle. This means a cap is set on the total amount of greenhouse gases that can be emitted – and, within the cap, installations buy or receive emissions allowances which can then be traded with one another. The cap is then reduced over time so that total emissions fall, and has reduced emissions by 35% so far.

All this means that there is an extra incentive for the cement industry to think about how it continues to use alternative fuels for the long term.

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Read the article online at: https://www.worldcement.com/special-reports/26012022/the-fuels-of-the-future/