Cement Sector : Energy Efficiency and Decarbonization (EE&D) Opportunities

Overview & Synopsis

Cement is an important large-scale manufacturing industry that contributes nearly 1 percent to Pakistan’s gross domestic product (GDP) annually and accounts for an estimated 25 percent of all industrial primary energy consumption. Energy contributes 60 percent to the total cost of cement production, and cement manufacturing in Pakistan relies on coal as the primary source of energy. More broadly, cement manufacturing accounts for between 65 to 70 percent of industrial coal consumption and at least 49 percent of the country’s coal emissions. Pakistan’s cement sector has 16 operational companies with 27 operational plants across the country. Ten companies operate in the north of the country, three in the south, and three have production plants in both the south and north. The cumulative production capacity was 77 million tons for fiscal year 2023. The subsector directly employs approximately 0.1 million people. The plants produce Ordinary Portland Cement, which is the main cement used in Pakistan. At 3.9 GJ/tonne of clinker, the average energy intensity of cement plants in Pakistan is close to the global average. According to the country’s latest greenhouse gas (GHG) inventory, the process emissions from the cement subsector accounted for 75 percent of total industrial process emissions in 2018. This note describes decarbonization interventions to improve energy efficiency and reduce emissions in the cement sector while increasing industrial competitiveness and providing wider economic and environmental benefits.