Castle Cement's report highlights debate on waste fuels and carbon neutrality

Castle Cement's latest sustainability report claims success in cutting carbon dioxide emissions - but the reduction is less impressive if fossil-based waste fuels are not treated as carbon neutral. The discrepancy will become increasingly important - Castle expects waste to account for 70% of its total fuel input by 2008.

Castle's fourth sustainability report claims a "continued improvement" in the company's CO2 emissions in 2003/4. By 2004, Castle had reduced emissions to 800kg per tonne of cement produced, down from 827kg in 2000. This represents a reduction of almost 82,000 tonnes of CO2 based on cement production in 2004.

The reduction comes largely from Castle's use of waste fuels such as tyres, solvents, paper and plastics instead of coal. Under the cement industry's climate change agreement (CCA) with the Government, waste fossil fuels are deemed to be "carbon neutral". The industry justifies the exemption on the grounds it provides an incentive to recover energy from wastes rather than landfilling them.

However, the Intergovernmental Panel on Climate Change and the European Commission argue that waste fossil fuels are not carbon neutral. Monitoring and reporting rules for the EU emissions trading scheme (EUETS) say that only biomass fuels such as plant-based fuels, sewage sludge, animal waste and the biomass fraction of industrial and municipal wastes are deemed to be carbon neutral (ENDS Report 347, pp 44-45 ).

Castle's sustainability report uses a CO2 reporting protocol developed by the cement industry and the World Business Council on Sustainable Development. The protocol attempts to square the circle between different national and international reporting requirements.

The protocol takes a balance sheet approach which allows companies to report gross CO2 emissions from both fuel and process sources, but excluding CO2 from biomass which should be reported as a separate item.

Companies should subtract any emissions rights allowed under national agreements, such as credits for using waste fossil fuels, to report their net CO2 emissions.

The protocol says this approach provides a "flexible framework for reporting under different schemes while still ensuring completeness, rigor and transparency of reporting."

Although Castle has used the WBCSD protocol, its report gives prominence to the more impressive net reduction in CO2 emissions. A graph compares gross and net emissions from 1990 to 2004, but the basis for the calculation is only explained in the small print of the appendices.

In a statement, Castle Cement denied that its report was misleading. Castle said its report is consistent with the WBCSD protocol, and has been externally verified by BSI which considered its handling of the data to be acceptable.

"We remain of the view that replacing coal with an alternative that would have been landfilled or incinerated results in a net reduction in emissions," Castle said. The company argued that the definition of carbon neutrality adopted under the EUETS was "not necessarily correct".

The discrepancy between the two reporting methods is likely to become increasingly important. Firstly, cement kilns will come under the EUETS in 2008 when the opt-out for companies under CCAs expires.

Secondly, the industry is planning to greatly increase the use of waste fuels. Castle has set a target to increase the use of waste fuels to 70% of the total fuel mix by 2008, and also to increase the use of alternative raw materials to 15%. However, the EUETS and CCA systems offer very different financial rewards for burning different types of waste.

The cement industry as a whole comfortably achieved its CCA target for 2004 securing an 80% exemption from the climate change levy. Emissions per tonne of cement have fallen by over 21% relative to the 1990 baseline, and the sector is well on track to achieve its objective of a 27% reduction by 2010.

Castle has set a target to reduce net CO2 emissions per tonne of product by 20% between 2000 and 2006. Achieving the target rests on the claim that waste fossil fuels are carbon neutral.

However, the commissioning of a new kiln at Padeswood this year will also play a major role, cutting emissions by some 17.5%. The kiln will replace the three existing kilns at the site - which were shut down this year because of high dioxin emissions (ENDS Report 363, p 7 ) - as well as two old wet kilns at the company's Ribblesdale site.

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