Webinar ‘Accelerating Cement Decarbonization in Indonesia Toward 2050 Learning from India and China’

Background

Industrial decarbonization is a crucial factor in achieving net zero emission for Indonesia, especially as the Ministry of Industry has signaled a sectoral net zero-amin by 2050, a decade earlier than the national NZE in 2060. This target faces challenges as industrial sector still contribute to 20% of the total GHG emission, with 64% came from the energy use, 24% from the industrial waste and 12% from industrial processes and product use. The complexity of industrial decarbonization aspects demand multidimensional approaches and strategies to achieve the target.

At the same time, the urgency to decarbonize the industry stems from market pressures. Particularly with the implementation of the EU Carbon Border Adjustment Mechanism (CBAM), which moves from its transitional phase (2023–2025) and will enter its definitive regime in 2026 when embedded emissions will be priced at the EU ETS rate upon import. The pricing of emissions from exporters under this regulation poses a threat to certain industry sectors, including the cement industry. If CBAM is implemented, Indonesia’s cement industry is expected to struggle, with declining export numbers and market share, leading to stagnation and reduced competitiveness in global trade. Beyond the EU, CBAM is already shaping global value chains through buyer requirements and green-procurement standards. Early preparation, robust MRV systems, product-level carbon footprints, and credible decarbonization plans, can mitigate exposure and preserve access to high-value markets.

As Indonesia grapples with the complexities of its net-zero transition, sector playbooks from India and China, the world’s largest cement producers, offer practical models. India’s Decarbonization Roadmap for the Indian Cement Sector: Net-Zero CO₂ by 2070 (GCCA India–TERI) prioritizes eight levers: improving clinker efficiency; increasing alternative fuels; expanding SCMs; decarbonizing electricity; deploying new binders; scaling CCUS; recognizing recarbonation; and boosting cement-use efficiency. The roadmap also calls for enabling policies such as building alternative-fuel supply chains, promoting low-carbon cements and efficient use, long-term CCUS policy support, and strategic green finance. The roadmap highlights that only using CCUS and considering recarbonation, the net zero can be achieved in 2070.

Beyond the roadmap, India has paired plant efficiency with policy instruments. Under the Perform, Achieve, and Trade (PAT) scheme, which is Specific Energy Consumption (SEC) in energy intensive industries, such as cement, iron & steel, fertilisers and distribution companies among others making them more resource and energy efficient. Cement plants have repeatedly over-achieved assigned energy-efficiency targets, delivering material energy savings. Sector benchmarking also shows Thermal Substitution Rate (TSR) for alternative fuels around 7% with a push to grow, and an emerging shift to green power procurement via PPAs for renewables—tools Indonesia can adapt with local tweaks.

China approaches the decarbonizing cement industry through their roadmap similar but has differences with India. The approaches such as demand reduction for cement, fuel substitution, energy efficiency, low-carbon cement composition, and CCUS. The reduction of their cement demand considered to be crucial as the forecasted declining demand, equivalent to reduction approximately 67% of the total carbon emission from their 2020 value. Additionally, China’s energy efficiency approach the energy consumption per ton of clinker in China is between 2.6 and 4.0 gigajoules, which is close to the average in Europe and the United States. 

This year, China release expansion of their national Emission Trading System (ETS), where previously only covered power sector, now it covers cement, steel and aluminum industries, therefore included around 3,700 companies into the ETS. The system marks a significant step in China’s efforts to reduce carbon emissions across multiple high-emission industries. By including cement, steel, and aluminum in the Emission Trading System (ETS), China is setting a clear signal to these sectors to innovate and invest in low-carbon technologies. While their approach shares similarities with India’s, China’s inclusion of additional industries in its ETS and focus on energy efficiency and demand reduction showcases a robust commitment to achieving long-term sustainability goals.

The webinar ‘Accelerating Cement Decarbonization in Indonesia Toward 2050: Insights from India and China’ aims to explore the challenges and opportunities in decarbonizing Indonesia’s cement industry. Through examining the strategies and approaches of India and China, the session will identify key gaps and opportunities that can guide Indonesia’s transition to a low-carbon cement sector by 2050.

Objectives

1. Facilitate the exchange of concrete experiences from Indonesia, India, and China on implemented decarbonization measures, including technologies, policies, and business models.
2. Facilitate discussion on Indonesia’s gaps and opportunities relative to India and China using comparable indicators (e.g., CO₂ intensity, alternative fuel substitution, supplementary cementitious material content, and energy efficiency).
3. Identify strategies for near-term adoption (12–24-month “quick wins”) and to achieve long term net zero