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Ambuja Cements to Invest 6,000 Cr. in Captive Green Energy Plants

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Ambuja Cements Ltd., part of the Adani Group, will be investing about Rs. 6,000 crore to set up Renewable Energy (RE) generation facilities for captive use.

Ambuja Cements conveyed this information via a stock filing dated 18th December 2023.

Ambuja Cements to set up 1,000 MW Green Energy Capacity

Ambuja Cements will set up solar and wind energy plants which will have a collective generation capacity of 1,000 MW.

The company will be setting up a 600 MW solar power plant and a 150 MW wind power plant in Gujarat, whereas a 250 MW solar power plant will be developed in Rajasthan. This RE capacity addition will be done in phases, and these facilities are expected to be fully operational during the 2025-26 financial year.

The company’s release specified that by March 2024, Ambuja’s captive RE generation capacity will grow to 284 MW, which will be then taken to 640 MW during FY-25, and finally to 1,090 MW in FY-26.

Step Towards Reducing Ambuja Cement’s Power Dependence on Fossil Fuels

Solar-Wind Hybrid Energy Park

Ambuja Cements plans to reduce its dependence on fossil fuels in the cement production process and increase the share of green energy for its captive use.

The company plans to increase the share of RE in its captive power requirements to 60% while expanding its cement production capacity to 140 MMTPA by FY-28.

As of now, the company has a cement production capacity of 74.6 MMTPA, and the share of RE in its captive energy requirements sits at around 19%. This is satisfied by the existing 84 MW RE captive plants of Ambuja Cements.

Lower Unit Price of Captive Power Expected to Reduce Production Cost for Ambuja Cement

Ambuja Cements expects to decrease production cost of cement by increasing the use of RE for its captive power requirements.

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Ambuja stated that the company’s cost per unit captive power is expected to decrease to Rs. 5.16 per unit post the aforementioned RE capacity enhancement from the current Rs. 6.46 per unit. This translates to a 20% reduction in per unit cost of Ambuja Cement’s captive power.

Considering the company’s cement production targets for 2027-28, this would mean a reduction of about Rs. 90 per Metric Tonne in Abuja Cement’s production cost.

Ambuja to Enhance Waste Heat Recovery Systems to 397 MW by FY-28

In its release, Ambuja Cements also specified that it would be increasing its Waste Heat Recovery System (WHRS) capacity to 397 MW by FY-28 from the current 103 MW. Like the enhancement of Ambuja’s captive RE generation capacity, this addition will also be done in a phased manner.

Ambuja Cements will enhance its WHRS capacity to 134 MW by March 2024, which will be grown to 195 MW in FY-25, 208 MW in FY-26, 250 MW during FY-27, and finally to 397 MW in FY-28.

Committed to Sustainable Practices, Setting Stage for Transformative Practices – Company CEO

On the matter of the company’s aforementioned plans, Mr. Ajay Kapur, CEO, Cement Business, said, “This strategic investment reaffirms our steadfast commitment to sustainable practices. We are not just aiming for a substantial increase in green power capacity but setting the stage for a transformative shift in the cement industry.” He elaborated that all the requisite approvals for the company’s aforesaid plans are in order and that this move will help Ambuja Cements not only realise, but also exceed its Environmental, Social, and Governance (ESG) goals.

About Ambuja Cements Ltd.: Ambuja Cements Ltd. became a part of the Adani Group in September 2022. A major Indian manufacturer of cement, the company’s aggregate cement production capacity currently stands at 74.6 MMTPA, with 18 integrated cement plants and 14 grinding units across India.