Why European cement production is heading for a second wave of alternative fuel adoption

Alternative fuel is one of the main pillars of any strategy to substantially decarbonise the global cement industry. According to the International Energy Agency’s roadmap for a low-carbon transition in the industry, alternative fuel has the potential to deliver 12% of the cumulative CO₂ emissions savings required to meet the two-degree scenario of the Paris Agreement 1 .

Yet, the adoption of alternative fuels varies greatly from region to region. In Europe, where the use of alternative fuels has the longest history, substitution rates are often well over 50%. Indeed, looking at the inquiries FLSmidth is receiving from customers on services, burners, dosing and handling equipment, it is clear that EU countries are currently experiencing a second wave of alternative fuels uptake that is driving substitution rates towards 100%.

Drivers of alternative fuel adoption: the European example

The first wave of alternative fuels use in Europe was driven primarily by economics. Simply put, alternative fuels offered a lower-cost source of energy than traditional fossil fuels. And this remains the key driver in many regions around the world, although no longer in the EU where other drivers –particularly the regulatory environment for waste and carbon emissions (see below) – are now leading the way to ever higher substitution targets.

In addition to the financial incentive, the availability of alternative fuels is also a key driver. European cement companies are well served by sophisticated industrial and waste-collection and preparation industries, both of which are key sources of alternative fuels.

A final driver is regulation. In the EU, waste disposal is tightly regulated and landfill is costly: waste producers and waste handlers therefore have a critical incentive to seek other avenues for waste disposal. The cement industry is an obvious candidate and, since the incentives enable the waste handlers to pay a gate fee, this also plays an important role in improving the return on investment of alternative fuels handling- and pyro processing equipment.

Alternative fuel use in Europe is further boosted by Europe’s carbon trading scheme. With cement producers required to purchase emissions allowances for every tonne of CO2 emitted – and with biogenic alternative fuels counting as zero-carbon under the scheme – the financial benefits are significant. This combination of cheaper fuel costs, gate fees, and the need to purchase fewer allowances provide a compelling business case for alternative fuels in the EU. It is the reason that the European cement industry is experiencing a second wave of investments in alternative fuels.

Conclusion: social sustainability and the circular economy   

The use of alternative fuels and biomass by the cement industry is also not only a story of environmental sustainability; it is a story of social sustainability and the circular economy as well. To this end, the cement industry is able to play a vital role in managing society’s non-recyclable waste in a way that limits landfill and reduces the amount of new materials (fuel and raw materials) extracted.  

FLSmidth has made it a key priority to support the industry in the use of alternative fuels, as part of our MissionZero ambitions launched last year. The first milestone is to provide cement producers the solutions needed to operate with 100% alternative fuels. This goes beyond the provision of equipment. With our deep expertise in the cement process – from initial handling and through the pyroprocess – we are able to assist customers with the process challenges that high levels of alternative fuel substitution rates bring.  

To read more about FLSmidth's offerings on alternative fuel click here.

1 IEA, 2018, Technology Roadmap: Low-Carbon Transition in the Cement Industry, p. 28.