DEDICATED TO MAKING A DIFFERENCE

The Cement Sustainability Initiative

Howard Klee

FICEM Co-Processing Forum

Coral Gables, Florida

July 21-22, 2010

A member-led program of the

World Business Council For

Sustainable Development

2

Sustainabilty

Important to our companies

Our “licence” to operate; access to resources Affects costs

Positive performance by companies

Reductions in emission of dust, NOx, SOx, etc

Transparency of information: public reporting and verification

Engagement with neighbours and stakeholders

Rehabilitation of redundant sites and worked out quarries.

Companies working actively on today’s challenges

Fatalities

Climate change

Role of concrete in sustainable construction

Biodiversity and land use management

3

CSI: 23 companies committed to

sustainability of the cement industry

(USA)

(Mexico)

(Spain)

(Brazil)

(Portugal)

(India)

(Germany)

(Switzerland)

(Ireland)

(Italy)

(France)

(Thailand)

(Portugal)

(India)

(Japan)

(Greece)

(Brazil)

(Brazil)

(China)

(China)

(China)(China)

(China)

Communication Partners

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Arab Union for

Cement & Building

Materials

Brazilian Cement Association (SNIC)

Mineral Products Association

Assossiacao Brasileira de

Cimento Portland

ActionPlanning Independent Study

1999 - 2002 2002 2002 - 2020

Individual

implementation

Joint projects

Communication

and outreach

+

How did we get here?

All reports available on the CSI website, www.wbcsdcement.org

Joint projects to develop :

guidelines,

best practices,

reporting and monitoring systems

Individual company actions

commit to SD

implement guidelines

publish emissions

Set targets and report progress

Summary of the Agenda for Action

In six key areas

- Climate protection

- Fuels and raw materials use

- Employee health and safety

- Emissions reduction

- Local impacts on land and communities

- Communications and progress reporting

New:

-Concrete recycling

-Sustainable construction

Defining Good Practice

Available on

CSI website

1. Updated and improved CO2 accounting

and reporting

2. Guidelines for the responsible use of

fuels and materials in cement kilns.

3. Developed a consistent set of safety

metrics.

4. Developed a collection of good practice

examples for Health and Safety

management.

5. Protocol for emissions monitoring and

reporting

6. Guidelines for environmental and social

impact assessment for the cement

sector.

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Safety

10

Reduction in Accident Frequency

0

1

2

3

4

5

6

7

8

2003 2004 2005 2006 2007 2008 2009

LT

I's

pe

r m

illio

n

ma

n h

ou

rs w

ork

ed

Frequency Ratio The LTI

Frequency for

Employees

improved to

2.4

The Severity

Rate for

Employees

improved to 82

This data

covers

approximately

190,000

employees 0

20

40

60

80

100

120

140

160

180

2003 2004 2005 2006 2007 2008 2009

Lo

st

days

per

mil

lio

n

ma

nh

ou

rs w

ork

ed

Severity Ratio

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2009 Fatalities by Direct Cause

• The Direct Causes of all 2009 Fatalities were similar to

prior years: incidents with moving vehicles (45%), falls

from height and hit by objects (both 13%) and caught in

moving machinery (11%).

All Fatalites by Cause

23

22

19

11

7

333211

31

78

Incident involving moving vehicles

Fall from height

Hit by moving, flying or falling object

Contact with Moving Machinery

Trapped by something collapsing

Contact with Electricity or an Electrical

DischargeCaught in or by Vehicles, Mobile Plant

Drowned or Asphyxiated

Slip, Trip or Fall at same or uneven level

Exposed to an explosion

Exposed to fire or heat

Hit against something fixed or stationary

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TF3 Fatality Prevention Review. . .

The CSI data shows a disconnect between

accident and fatality rate reduction

So CSI looked outside the sector for Best

Practice:

Which are the best-performing companies?

How do they achieve success in fatality elimination?

What can we learn from these companies?

The results were very surprising………

The best performers have a Fatality Rate 1/10th

of average CSI Rate

60% of the best companies had specific fatality prevention programs, with 6 key attributes…….

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Key best practice factors in Fatality

Prevention…

A highly visible CEO commitment

Safety Training for Senior Management

Establishing Safety “Golden Rules”

Strong Safety Management of Contractors

Strong Safety Management of Drivers

Rigorous Fatality Investigation Procedures

CSI ACTION PLAN

Major initiatives on Driving and Contractor Fatality

Prevention – only acceptable result is zero fatalities

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Contractor and Driver Safety Initiatives

Available on : http://www.wbcsdcement.org

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Climate

Change

Cement production growth (GNR)

16Projected growth to 3-4 billion tonnes/yr by 2030

CO2

production from Cement (GNR)

17

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Climate Change

5+% of manmade CO2 emissions comes from

cement production. Cement is on the radar of

all policy makers around the world. Mitigation policies will impact cement production.

Carbon costs will be a major production cost in the future.

Models of future IEA, CSI, McKinsey, CCAP, Others

All identify the same 4 levers for CO2 Control Alternative Fuels

Replacement of clinker

Energy efficiency

Carbon capture and storage

Levers for CO₂ Reductions in Cement Industry

1. Energy efficiency – small impact; new plants

already highly energy efficient

2. Alternative fuels – co-processing biomass and

waste materials

3. Blending materials – using substitutes for clinker

4. Carbon Capture and Storage – not yet ready

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Kiln fuel Efficiency

2007 data represents 636 individual cement plants around the

world with a cumulative output of 670 million tonnes clinker

Mean 2007 economy

3690 MJ/ton

Little improvement in

the performance of the

best 10% since 1990.

Wet process

production fell from

15% of total in 1990 to

5% in 2007.

Use of calciners has

increased from 30% to

49% between 1990

and 2007

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Kiln Fuel Efficiency

Machinery producers report little research on new

processes for clinker manufacture.

R&D focuses on optimisation of current technologies and

on power efficiency.

Calciner technology is close to the practical technical limit

of fuel efficiency.

Replacement of old technologies is the key strategy to

improve industry efficiencies. Wet & shaft kilns mainly in

Russia, US and China are in the high end of the fuel use

curve.

Excellence in operational performance is a prerequisite of

low carbon cement production.

Levers for CO₂ Reductions in Cement Industry

1. Energy efficiency – small impact; new plants

already highly energy efficient

2. Alternative fuels – co-processing biomass and

waste materials

3. Blending materials – using substitutes for clinker

4. Carbon Capture and Storage – not yet ready

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Alternative Fuel Use Factors

Economics Alternative fuel can be less expensive

Processing in cement kilns is an economically and environmentally effective solution

Service to Society Co-processing provides society with sound waste management

alternative to incineration and landfill

Meets strict environmental requirements

No toxic waste ash produced

No landfill for residuals

No groundwater contamination

Solid, reliable emissions data needed to build public and government trust in co-processing

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Alternative Fuel Use Factors

Supply side Waste management legislation should restrict land-filling.

Adequate waste collection networks

Alternative fuel preparation facilities.

Permitting Remains a local issue

Stakeholder resistance

Accurate advocacy documents

Plant design Inadequate ID fans

Short calciner residence times

No bypass

CO2 status Biomass treated as carbon neutral

Mixed streams, Fossil derived

Alternative Fuel Use

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Alternative Fuel Use

26

Energy Use by Region and Type

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Projected Future Use of Alternative Fuels

Levers for CO₂ Reductions in Cement Industry

1. Energy efficiency – small impact; new plants

already highly energy efficient

2. Alternative fuels – co-processing biomass and

waste materials

3. Blending materials – using substitutes for clinker

4. Carbon Capture and Storage – not yet ready

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Clinker Content of Cement

Year: 2007

Region: World-wide

Company: All GNR participants

** Graph generated with data at company and country level **

CSI - "Getting the Numbers Right"

Clinker to cement ratio (Company level)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

% cement production

%

2007 2006 2005 2000 1990

Little change in

recent years

77% Mean ratio

Key MICs

Slag

Fly ash

Limestone

Pozzalana

Many models assume

70 – 73% clinker in the

future

2008 data represents 49 individual cement companies around

the world with a cumulative output of 900 million tonnes cement

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Clinker Content of Cement

Limited availability of some MICs1

Flyash: 590 million tons

Slag: 308 million tons

Others (excluding limestone): 50 million tons

Unclear effect of mitigation strategies in other industries. Recycling of steel.

Degasification of coal.

CCS in other industries.

Decarbonisation of the power sector

Need to link “roadmaps” of industries related by use of wastes.

Regional conventions. MICs added at concrete mixer

Standards of cement and concrete

1 IEA estimate of 2005 availability

Levers for CO₂ Reductions in Cement Industry

1. Energy efficiency – small impact; new plants

already highly energy efficient

2. Alternative fuels – co-processing biomass and

waste materials

3. Blending materials – using substitutes for clinker

4. Carbon Capture and Storage – not yet ready

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Carbon Capture and Storage

An emerging technology featuring Capture and Use (making aggregates, biofuels)

Capture, Compression &Transportation

Storage

Each step is established technology in some industry.

The combination remains unproven with costs unclear.

All models of mitigation strategies include CCS as an

important part of combating climate change.

Much R&D is in hand, but not all. The cement industry

is likely to use the CCS infrastructure developed for the

power sector. But, efficient capture technologies will be

industry specific. The impact on cement production

costs is unclear.

IEA expect 50% of EU plants to capture CO2 in 2050.

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“Getting the Numbers Right”

GNR is the CSI’s confidential database

operated independently by PWC.

Focus on energy efficiency and climate change

data. ~860 million tonnes of cement production

is represented in the graphs in this presentation

Reports for the year 2008 will be available on

April 25th on

www.wbcsdcement.org

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“Getting the Numbers Right”

Performance Facilitates benchmarking

Costs CO2 and cost drivers are very similar.

Development Useful baselines for JI and CDMs

Participation is open to non-CSI companies and

trade associations also. Companies wishing to

participate can contact :

Eamon Geraghty egeraghty@crh.com

Howard Klee: klee@wbcsd.org

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Summary

Cement Industry has a good track record

on sustainability issues

Today’s challenges:

Elimination of fatalities

Managing Climate impacts

Proving our product to be sustainable.

Many initiatives in play within our industry

CSI welcomes FICEM to participate in

“Getting the Numbers Right”