Alternative Fuel in Southeast Asia's Cement Industry

The cement industry in Southeast Asia is progressively embracing alternative fuels as part of its strategy to reduce carbon emissions and meet sustainability goals amid rapid infrastructure growth in the region. Cement production is energy-intensive and traditionally reliant on coal, which is a major source of greenhouse gas emissions. Recognizing this challenge, leading cement producers in Southeast Asia are increasingly substituting fossil fuels with alternative fuel sources such as biomass and refuse-derived fuels (RDF), alongside efforts to reduce clinker use and improve energy efficiency.

In Thailand, the Siam Cement Group (SCG), the country’s largest cement producer, is a pioneer in adopting alternative fuels. As of 2024, SCG achieved a thermal substitution rate (TSR) of about 28.5%, primarily replacing coal with biomass—including rice husks, sawdust, and other agricultural residues—and RDF obtained from waste materials. SCG also promotes energy crops like bamboo and Napier grass to support fuel needs sustainably. This initiative is part of SCG's broader low-carbon roadmap aimed at achieving net-zero emissions by 2050, which includes phases for energy transition, green technology innovation including carbon capture utilization and storage (CCUS), and ultimate adoption of bioenergy-based negative emission technologies. SCG simultaneously integrates renewable energy solutions, such as solar power and smart grids, into its operations to further reduce its carbon footprint and diversify its energy mix.

Another major player, Siam City Cement Public Company (SCCC), focuses on reducing its clinker ratio and increasing the use of alternative fuels. In 2024, SCCC raised its TSR to 28%, surpassing previous targets by utilizing advanced waste pre-treatment to enhance fuel efficiency and increase biomass fuel use, effectively lowering reliance on coal. These measures, combined with targeted reductions in clinker usage, have helped decrease carbon emissions and improve overall environmental performance.

Across the wider region, Indonesia is also advancing similar measures, guided by national decarbonization roadmaps aiming for net zero by 2060. The Indonesian Cement Association supports increasing alternative fuel use, optimizing energy efficiency, and lowering clinker factors in cement production. Southeast Asia's total cement production capacity is significant, with Vietnam, Indonesia, Malaysia, Philippines, and Thailand accounting for nearly all regional output, underscoring the scale of impact that alternative fuel adoption can have in regional industrial decarbonization.

The adoption of alternative fuels in Southeast Asia’s cement industry aligns with the region’s complex economic growth and urban infrastructure demands by promoting sustainable industrial development while addressing energy security and waste management challenges. By converting agricultural residues, industrial waste, and other biomass into energy, the cement industry helps reduce landfill demand and environmental pollution alongside cutting carbon emissions. As the ASEAN region works toward net-zero targets and green industrialization, the cement sector's transition to alternative fuels is a critical component of the low-carbon economy transformation.

Despite these advances, the current share of alternative fuels in the cement industry’s energy mix still leaves room for expansion, with leading companies aiming to increase TSRs significantly over the coming decades. The integrated approach of combining alternative fuels with renewable energy adoption, clinker reduction, and emerging green technologies illustrates the multi-faceted strategy necessary to decarbonize this hard-to-abate sector effectively. Southeast Asia's cement industry thus offers a promising example of industrial sustainability progress in a rapidly developing context.