Decarbonizing the Cement Industry

The cement industry provides – quite literally and figuratively – the foundations for the infrastructure of today’s modern economies.

“Concrete is critical to enable progress,” explains Olmo Lopez, director of Innovation and Ready-Mix Performance at Holcim. “It enables us to build the infrastructure that we need. Concrete enables us to build safe, affordable and durable homes for people.”

Yet the industry also contributes an oversize portion of global greenhouse gas emissions.

Therein lay the dilemma. Infrastructure and affordable housing are a public good. Climate change causing carbon emissions from the cement used to build them are not.

It’s something that some in the industry are starting to look at ways to address.

Lopez oversees strategy development to implement sustainable solutions at Holcim, which supplies ready mix concrete to the construction industry. The company says that it aims to become a global leader in sustainable building solutions. 

In this interview, Lopez discusses the challenges and opportunities of decarbonizing the cement industry, why culture and education are so important to sustainability, and the importance of looking outside your industry for new ideas.  

Diana Davis, IX Network: Decarbonizing the industrial sector is high on President Joe Biden's agenda. How is the drive for decarbonization affecting your business?

Olmo Lopez: It has affected us tremendously. The cement industry represents approximately 10% of global C02 emissions but concrete is critical to enable progress. It enables us to build the infrastructure that we need. Concrete enables us to build safe, affordable and durable homes for people.

For instance, I’ve seen estimates that suggest that a city the size of New York is going to be built every month between now and 2040.

As a company we take very seriously our role in continuing to provide these products and search for more sustainable ways of creating cement. On a personal level, I’m very excited about the opportunities for decarbonization in my industry.

Diana Davis, IX Network: I think it's really interesting what you say about concrete enabling progress. One of the things that we’ve witnessed in developed economies in the past few years is an incredible housing boom that some attribute to lack of supply. However, building and construction clearly have an environmental impact. How do we build enough affordable houses for people, on the one hand, and yet also mitigate the risk of climate change on the other? It sounds like you're caught in the middle of that dilemma.

Olmo Lopez:  That's one of the bigger challenges that we have.  We need to better utilize our resources.

For instance, as buildings are demolished we can re-use the concrete. This would allow us to stop extracting virgin rock, which has a large environmental footprint.

The challenge today is that virgin rock is currently financially cheaper than the recycling option.

Another thing we're exploring is sustainable trucking. We’ve just made a commitment to a start up in Austin, Texas that has a technology for sustainable trucking. These trucks are more expensive than our existing fleet but we are putting our money where are mouth is because we believe that it’s the right thing to do.

That’s biggest challenge that we have today. Most of the time sustainability is more expensive than the alternatives.  This is a challenge between doing what's right and what’s profitable. How do you balance those competing needs so that you can move forward?

Diana Davis, IX Network: Let’s explore that a little bit. You mention reusing materials, but this has a cost in terms of C02 and money because of the energy that needs to go into the process. How do you evaluate the overall effectiveness of some of these solutions. If we assume that everything we're doing has an impact on the environment, how do you find the least bad option?

Olmo Lopez, Holcim: We use a lifecycle assessment (LCA). This allows you to assess the overall impact of our products and services over its entire life span. It’s rare that answers in sustainability are ever black and white.

For instance, if you look at the differences between concrete and lumber. It requires lower emissions to produce lumber than concrete; however, concrete lasts longer than lumber. Over its entire life cycle – assuming a long lifespan – concrete has a lower embodied carbon per unit than lumber.

MIT has also done some interesting studies on concrete pavement where they were looking at friction. They found that vehicles are more fuel efficient when driving on concrete surfaces than on wooden ones; concrete surfaces reduce the carbon emissions of the cars driving on them.

To take another example from outside my industry about the difficulty of assessing how sustainable a solution really is, consider electric vehicles. They don’t produce emissions while they are running but if the electrical grid is powered by a dirty fuel source such as coal, the vehicles still have an impact. They are ultimately being powered by a polluting fuel.

Further, what happens to the vehicle’s battery at the end of the vehicle’s life? There don’t yet seem to be large scale solutions for battery recycling.

I think this is one of the fascinating things in this journey. Sustainability is relatively new and we are learning new ways of assessing our impact.

That’s why I think transparency is fundamental for sustainability.  The question is: are we doing the right thing for the world? Transparency will help us ensure that we are.

Diana Davis, IX Network: At Holcim, you’re the Director of Innovation and Ready-mix Performance. I understand that part of that role is strategy development to implement sustainable solutions. What exactly does that entail?

Olmo Lopez, Holcim: Without delving too much into the technical details, it’s important to understand a bit about how we make concrete.

You have aggregates – such as rocks and sand – and you have cement. The aggregates generate about 5-8 kilogram (kg) of C02 per tonne and cement generates about 1000 kg per tonne of C02.

Then you have water and other mixtures and you combine them.

In concrete, it’s all about resource optimization. I believe that by better utilizing our resources we can achieve a huge reduction in carbon emissions by just doing things better within the constraints of existing technology.

In cement production, 50% of the emissions comes from the calcification process. This is where limestone changes to a completely different set of materials by adding heat. The heat we add is extremely high – a quarter of the temperature of the sun – which generates approximately 50% of the emissions released during this process (the other 50% comes from the chemical reaction itself).

To offset the energy emissions, we have been buying more green energy. We have a solar farm in one of our plants, for instance.

To offset the emissions release during the chemical process is a little more difficult. We need to reduce the amount of cement we use in our concrete in order to reduce the carbon footprint.

We can use materials such as slag and fly ash to achieve this.  The embodied carbon for slag, for instance, is approximately 150 kg per tonne of C02 (versus 1000 kg per tonne for cement).

The challenge with this is that in the US, the concrete industry is very prescribed. When we quote for a project, often the concrete constituents are specified. In Europe, by contrast, the focus is on achieving a certain tensile strength and durability that meets certain parameters. The concrete companies then have some scope to meet those parameters with different mixtures that are leaner and produce lower C02 emissions.

That makes a huge difference. One ton of cement in Europe, for instance, is about 600 kgs per tonne of carbon. In the United States, our cement is about 1000 kg per tonne of carbon. Europe is 40% better because they have been able to optimize their resources by focusing on performance rather than prescribed mixes.

Going back to my earlier point, I believe the race starts with how we can better utilize our resources.

That’s one aspect of my job. The other is looking at new technologies and ways of doing things that can help us.

The sustainable trucking company that I mentioned earlier, uses renewable natural gas to power the vehicles. Now you can capture methane and use it to power your trucks, which is a big part of our carbon emissions as we transport our product to our customers.

The final area I’m looking at is how we can use data to create efficiencies. How can I better utilize my resources with the data that I have? We have a lot of data but it is not useful if we don’t take immediate action on the insights.

A ready-mix company is a logistic company because we make or lose money on the logistics. There’s not enough room for price optimization on the product side so we need to achieve competitive efficiencies on our deliveries.

Data would allow us to better utilize the resources that we have right now.

How can we use the data that we have to generate meaningful and actionable insights to help our operations? More importantly, how can we create the tools that allow our supervisors and managers meaningful and actionable insights so that they can make real time corrections to optimize resources.

Diana Davis, IX Network: What would you say has been the biggest challenges in terms of implementing some of these sustainable solutions in your business?

Olmo Lopez, Holcim:  Changing culture has been a big challenge. We can talk about fancy things such as the electrification of our fleets, or CCUS. But if we’re not going to get there if we don’t utilize our resources; that takes a change in mindset.

Both the challenge and the beauty of my industry is that it is made up of hardworking people that start out on the job sites with a shovel and then rise up through the ranks in the business. It’s wonderful that my industry rewards hard work and opens up opportunities for people. But it can be difficult to change entrenched cultures. 

Diana Davis, IX Network: What would you say are your key lessons learned over the last couple of years as you've gone one this journey and tried to implement these solutions in your business?

Olmo Lopez, Holcim: I think one of the key lessons for me is the importance of education. I don’t just mean the education of our workforce. When we sell concrete, we usually sell to a subcontractor who is performing for a general contracting company (GCC) who is performing for an owner.

The subcontractor is not in end user of the product. The GCC is not the end use of the product. The owner is not the end user. The end user is the person who is going to buy the house.

What the end user doesn’t understand is that we can make the concrete greener. But the end user needs to demand it because it will come at a higher cost.

It’s not unprecedented for consumers to pay more when they understand the sustainability impacts of their choices. My wife loves Lululemon, for instance, which sells athletic clothing. We pay a premium for their clothing because the brand supports recycling clothing and uses natural dyes. It took a process of education for us to understand the impact that different dyes have on the environment.

I think that education will be an important part of embedding sustainability.

Diana Davis, IX Network: What role do you see America's industrial sector – both nationally and internationally - playing to get us to net zero?

Olmo Lopez, Holcim: In my company, every time we have an initiative, where do we start? The US. It’s one of the world’s biggest market.

As more and more companies in America’s industrial sector put their money where their mouth is, the faster we will advance.

So what is the role of industry in the US? I think we need to keep investing. As we accelerate innovations and create more jobs in sustainability the more we’re going to lead the world.

Diana Davis, IX Network: My final question is what are you hoping to get out of our decarbonizing America’s industrial sector event this fall in Palm Springs?

Olmo Lopez, Holcim: I truly believe in open innovation forums. We can learn so much from other industries. I notice a lot of the issues that we have are the same across multiple industries. I think there's also a place for concrete, steel and energy to work tougher so that the waste from one industry is used to create products in another.

I want to hear what other people are doing. I want to hear new ideas. I believe that open innovation and collaboration are going to be key to move us forward.

Interested in learning more about this topic?

Olmo Lopez will be speaking at our upcoming Decarbonizing America’s Industrial Sector. Join him and over 200 of your industry peers to advance clean manufacturing and help reinvigorate America's industrial sector September 13-15, 2022 in Palm Springs. Download the agenda for more information.