Holcim is known to burn all kinds of fuel in its kilns - from city wastes to tyres to animal carcasses to agro-wastes.

Kripa Raman

Mumbai, Nov. 13

THE Associated Cement Companies (ACC) has set up a separate department for `alternative fuel resources' while Gujarat Ambuja is looking at groundnut husk as fuel and even considering wind energy for its factories.

This exploration of use of alternative fuels, for cement manufacturers' captive power plants or burning in their kilns, is partly due to the rise in price of mainstream fuels this year.

The other reason is these companies' association with Swiss major Holcim which, through Ambuja Cements India Ltd, holds a substantial stake in ACC.

One of the first things to happen after the Holcim entry into ACC has been the setting up of the alternative fuel resources department, according to officials associated with ACC. Holcim is known to burn all kinds of fuel in its kilns - from city wastes to tyres to animal carcasses to agro-wastes, they said. This cell will address the alternative fuel possibilities for the company.

As for Gujarat Ambuja, its 60-megawatt captive power plant in Gujarat is being converted into something that will handle a range of fuels furnace oil, sold fuel, coal, lignite, petcoke and even groundnut husk, said Mr Anil Singhvi, Executive Director, Gujarat Ambuja (GACL).

"Our power plant in Ropar (in Punjab) runs on rice husk," he said. The plant is located near the farmlands where the husk is aggregated and processed into pellet form, he said.

One important condition is that the manufacturing units must be located where such alternative fuels can be aggregated. Gujarat Ambuja would like to minimise coal usage in its kiln over 12 months, he said.

Extensive groundnut cultivation in Gujarat will make aggregation of groundnut husk possible for GACL's plants in that State. "We can bring down power costs from Rs 5 per unit to Rs 3.50 per unit with the use of lignite. It can be brought down further to Rs 2.5 and even to Rs 2.00 with the use of alternative fuels," he said.

GACL will also increase its share of blended cement through increased use of fly ash (which can also get it carbon credits internationally). Its operations in Maharashtra and Gujarat will increasingly use fly ash (instead of clinker). An arrangement with Gujarat Electricity Board is already in place for supply of fly ash.

This will also increase operating margins at GACL what with clinker costing Rs 700 per tonne and fly ash costing only Rs 200.

The basic advantage for GACL is that it has a lower clinker-to-cement ratio of 1.17 as opposed to the Indian industry average of 1.28 (ACC's is 1.4 times). This gives the company considerable scope to increase production as well as margins, said Mr Singhvi.

(This article was published in the Business Line print edition dated November 14, 2005)
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