FROM EQUIPMENT TO ECOSYSTEM: CEMENT'S NEXT EFFICIENCY FRONTIER

India 's most efficient industrial sector has taken equipment-level gains close to their limit. The next chapter depends on reliability, circularity and the wider ecosystem beyond the factory gate.

By Raj Narayanan E R

Twenty-five years ago, energy efficiency in Indian manufacturing was an engineering brief. An engineer was asked to cut the power or fuel consumed on a line, performance was measured against a target, and the project was closed. That framing served industry well, nowhere more visibly than in cement: Indian plants today rank among the most energy-effcient in the world, ahead of comparable plants in Europe, Japan and Korea. But a discipline built to capture equipment-level gains eventually meets a harder question what happens once the equipment has been optimised as far as physics and available technology allow?

Efficiency has already moved once, from a shop-floor task to a subject of leadership attention. It must move again, from optimising individual machines to optimising the ecosystem in which they operate: the digital systems that run them, the resource flows that feed them, and the institutions that supply and price those inputs.

This matters well beyond cement. India is adding industrial capacity at a pace few economies can match, and the efficiency model built into that capacity now will shape competitiveness, energy security and decarbonisation for decades. Cement, having reached the limit of what conventional measures can deliver, shows what must come next.

FROM EQUIPMENT PROJECTS TO A LEADERSHIP DISCIPLINE
What counts as an efficiency intervention has itself shifted over the last decade. Twenty years ago, it meant an equipment-level project: a more efficient motor, a better-insulated line, a discrete upgrade with a start and a finish. Today the conversation takes place at the level of manufacturing philosophy, operational discipline and digital capability, and is treated as central to competitiveness. The distinction is not cosmetic.

An equipment project asks how one machine can consume less. A systems discipline asks how an entire production chain, and the ecosystem feeding it, can be reorganised to draw more value from every unit of energy and material consumed.

Renewable power, waste heat recovery, alternative fuels and digital monitoring are no longer separate initiatives bolted on to a conventional plant. They are parts of one interdependent system, where a gain in reliability in one place produces a gain in energy efficiency in another, and where the binding constraint is not any single piece of hardware but the quality of the system's design and operation.

Two developments show how far this view has travelled. The first is renewable energy, which entered mainstream planning only five or six years ago.

Early on the constraint was availability: renewable power could support operations for about sixteen hours a day, after which the plant fell back on the grid. The ambition today is round-the-clock supply, and closing that gap is not merely a matter of adding capacity. It calls for storage, long-term contracts, access to interstate transmission so that power generated in one state can be used at a plant in another, and a far more sophisticated balancing of demand across the grid, the company’s own renewable plants and power from alternative fuels.

Electrification of process heat is the natural extension of this thinking. UltraTech's collaboration with Coolbrook of Finland uses the RotoDynamic Heater to deliver process heat of the order of 1,400 degrees Celsius from electricity rather than fossil combustion, and is being advanced through pilot trials with the intent of extending it into core cement-making processes.

"A plant that runs reliably around the clock extracts more genuine efficiency from its equipment than one that runs the same equipment intermittently. "

The second is waste heat recovery. A cement plant is built around the kiln, a large rotating furnace in which limestone is burnt at close to 1,450 degrees Celsius. The gases leaving it are extremely hot, and waste heat recovery captures that heat to generate power instead of releasing it. Recent gains have come not from new equipment but from a better understanding of the process and improved reliability of the recovery system. No additional energy is created; the plant simply captures more of what previously escaped. Both examples make the same point: the binding constraint has shifted from the hardware to the discipline applied around it.

WHY RELIABILITY, NOT JUST TECHNOLOGY, IS THE NEW EFFICIENCY LEVER

Reliability has become one of the most significant remaining levers for energy efficiency, more so today than incremental equipment upgrades. Efficiency is a function of how well an asset is used over the hours it runs.

A plant that operates reliably around the clock draws more genuine efficiency from its equipment than one running the same equipment intermittently over sixteen hours. Digital tools have been central to this gain not as technology for its own sake, but as the meeting point of deep domain knowledge, tools that reveal patterns conventional monitoring cannot see, and the infrastructure to connect the two at scale.

The source of those tools has also shifted. Kilns, motors and control systems still come from established equipment providers, while the digital layer increasingly originates in the start-up ecosystem, which brings fresh tools and fresh problem framings to the shop floor. The gains come when the two are brought together: value emerges where domain knowledge and digital tools are applied to a specifically identified problem, and the sector's experience now offers a clear template for making that combination work.

WASTE AS RAW MATERIAL: THE SHIFT FROM DISPOSAL TO CIRCULARITY

A second frontier lies in how industry relates to waste. Alternative fuel s are waste materials —from other industries and from cities — burnt in the kiln in place of coal. They were once seen as a disposal service: cement manufacturing was a convenient destination for material that had nowhere else to go, a solution offered to other sectors rather than an input to manufacturing. That relationship has matured. The position now taking hold treats such waste as a raw material in its own right, whose value depends on how carefully it is separated, sized and chemically tested before it reaches the kiln.

The technical reality explains why this matters. The thermal substitution rate is the share of a plant's fuel requirement met by alternative fuels rather than coal. At around five per cent, a plant tolerates wide variation in what it receives. As the rate rises towards the levels advanced Indian plants now target, that tolerance narrows sharply. Consistent burning calls for the quality discipline the coal supply chain built over decades — particle size, moisture and feed rate tracked with precision — extended to alternative fuels. Digital technology helps here too, giving far better insight into how waste streams behave inside the kiln, how fuel mix and injection point affect burning, and where the process can be adjusted to handle a variable input cleanly. This is a system-level opportunity, and it depends on capability at three points. First, a policy framework that brings waste classification and approval requirements into a single, streamlined pathway. Second, waste management companies willing to move up the value chain into processing and segregation, supported by business models that make such investment viable. Third, application knowledge within the user industries, since even well-processed waste delivers full value only when the receiving plant knows how to blend, size and burn it. Municipal solid waste offers the largest headroom: as collection, segregation and treatment capacity expands, the volume and consistency available to industry will rise with it.

Geography matters as much as quality. Moving waste over long distances can consume much of the carbon that substitution is meant to save, so frameworks encouraging alternative fuel use will deliver most when they account for logistics and reward the shortest practical route from source to kiln. So does moisture. Waste carrying thirty-five to forty per cent moisture is largely water being carried across the country at the cost of fuel and carbon, and then dried at the receiving plant. Drying and size reduction close to the point of collection would release that value, at far lower cost than each plant doing the same work independently.

The energy used for such drying is itself open to improvement. The RotoDynamic Heater’s first application at an UltraTech unit is precisely this — replacing fossil-fuel heat used to dry alternative fuels with electrically generated heat — showing how circularity and energy decarbonisation reinforce one another.

Liquid and hazardous waste streams — chemical residues from pharmaceutical, refinery and other process industries — offer substantial substitution potential, and one enabling step will unlock most of it: a clear specification and reliable chemical composition accompanying every consignment. With that information in hand, a manufacturer can judge how the material will behave in the kiln, what it will do to product quality and how to handle it safely.

Making characterisation and disclosure a routine part of transfer is a straightforward reform, and it would open up a large volume of material that industry is both willing and technically able to absorb.

WHERE THE NEXT GAINS WILL COME FROM

Any sector at leading efficiency levels faces a natural question: will further investment cost more and return less? Reliability improvements compound rather than plateau, and continue to offer meaningful returns even in an already efficient operation. A plant that improves uptime captures gains a purely technology-focused view would miss, because the measure that matters — energy consumed per unit of genuinely productive output — keeps shifting as reliability improves. Renewable energy shows a similar pattern: as the cost per unit falls through higher renewable use and better transmission access, the economics of switching keeps improving rather than flattening out.

The record of the past quarter-century points the same way. Gains have come from technology improvement and product innovation together, not either alone, or the industry’s energy mix has been reshaped as a result. The diminishing returns question is therefore misframed when asked only of individual technologies. Returns do diminish within a given approach. But new approaches — reliability, circularity, digital optimisation, product reformulation — keep opening fresh headroom even in sectors that appear to have exhausted the obvious opportunities.

UltraTech’s work with the Institute for Carbon Management at the University of California, Los Angeles, is headroom of exactly this kind. The ZeroCAL process converts limestone electrochemically into calcium hydroxide, avoiding almost all the carbon dioxide otherwise released when limestone decomposes in the kiln, and the product can replace limestone in the existing process. A demonstration plant is being developed at one of the company’s integrated units. The hydrogen and oxygen produced along the way can be used within the plant, and a wider range of limestone grades becomes usable, strengthening raw-material security alongside decarbonisation.

BUILDING DEMAND FOR LOW-CARBON PRODUCTS

Efficiency and decarbonisation are related but not identical, and cement’s progress on carbon intensity — the carbon dioxide emitted per tonne of cement — shows where the two diverge. That figure has fallen substantially through operational efficiency, circularity, renewable power and reformulated products that use less clinker. Clinker, produced when limestone is burnt in the kiln, is the single largest source of emissions in cement making. Blending it with fly ash from power plants or slag from steel plants lowers the carbon content of the final product, and most cement produced in India today is already a blended variety, well ahead of what the market considered standard a generation ago.

The search for new blending materials continues alongside. UltraTech has entered into a consortium with EnviCore, Queens Carbon and NeoCrete to develop and evaluate a new generation of supplementary cementitious materials — drawn from waste streams, from limestone and sand, and from activated pozzolans — with the specific objective of reducing clinker content further in commercially usable products.

This progress has been led largely from the supply side. Manufacturers have invested heavily in making the lower-carbon option available at scale, and the next stage of gains will come as demand-side signals develop to match that capability. The direction is encouraging. Buyers are increasingly expected to look less at the technical classification printed on the bag and more at how the cement performs in concrete, which brings carbon intensity naturally into procurement conversations.

Government procurement preferences, building codes that account for embodied carbon — the emissions locked into a building’s materials before it is occupied — and the carbon markets now taking shape each offer a lever to convert a supply-side achievement into genuine demand. Once a credible price signal is in place, industry can respond quickly, because the capability to produce lower-carbon products in volume already exists.

THE WAY FORWARD

The lesson extends well beyond cement. The foundation that carried India’s first quarter-century of industrial energy efficiency — equipment-level projects, plant-by-plant upgrades, efficiency measured as reduced utility consumption — delivered substantial gains, and cement’s global standing is proof of what it achieved. The next quarter-century will build on that foundation with a wider set of capabilities: reliability engineering that treats uptime as an efficiency lever; digital tools aimed at clearly defined process problems; circular resource flows that draw as much on upstream waste management and coherent policy as on the receiving industry; and market mechanisms that convert low-carbon capability into priced demand.

Partnerships of this kind are already taking shape. Under the Department of Science and Technology’s national programme of cement-sector carbon capture and utilisation testbeds, UltraTech is the industry partner for one of five selected projects, with IIT Madras and BITS Pilani, K K Birla Goa Campus, as knowledge partners.

The three-year project will establish a one-tonne-per-day capture and mineralisation pilot integrated with a working plant, associated with the company’s Reddipalayam operation in Tamil Nadu, with UltraTech meeting a quarter of the cost.

None of these levers sits entirely within any single company’s control, and that is precisely the opportunity. The next stage of India’s efficiency journey depends less on any individual plant achieving a better number than on the ecosystem around every plant — waste management companies, digital start-ups, policymakers and buyers — building the capability and the incentives to meet manufacturing halfway.

For an economy adding capacity at India’s scale, embedding this view now, while the capacity is still being built, will do more for competitiveness, energy security and decarbonisation than any further round of equipment-level optimisation. The task is clear: build the policy, market and institutional scaffolding around industry as deliberately as industry has built efficiency into its own operations. That is where the next twenty-five years of gains will be found.

E R Raj Narayanan is the Business Head & Chief Manufacturing Officer at UltraTech Cement Limited. His work spans plant operations, manufacturing excellence and the adoption of digital and low-carbon technologies across a large multi-plant network, and he engages with policy and industry forums, including the CII Sohrabji Godrej Green Business Centre, on energy efficiency, alternative fuels and circularity.

The article is a part of ‘The Energy Efficiency Imperative’, a book published by the Confederation of Indian Industry (CII)’s CII-Green Energy Efficiency Council. The book was released on the occasion of the 25^th CII Energy Efficiency Summit 2026.