Mobilizing Climate Finance for Decarbonizing Indonesia’s Cement Industry: A Techno-Economic Assessment of Calcium Looping Technology Deployment

“The cement industry is a cornerstone of global infrastructure development and plays a pivotal role in Indonesia’s economic growth. However, it remains one of the hardest-to-abate sectors, contributing significantly to national industrial carbon emissions. Unlike the power generation sector, where emissions are primarily derived from fuel combustion, a substantial portion (approximately 60%) of cement manufacturing emissions stems from the calcination process of limestone (CaCO_3 →CaO + CO_2) in the kiln. This chemical reality means that decarbonization cannot be achieved simply by fuel switching or electrification; it requires the deployment of advanced Carbon Capture, Utilization, and Storage (CCUS) technologies.

Among the emerging carbon capture technologies, Calcium Looping (CaL) stands out as the most promising and synergistic solution for the cement industry. Unlike amine-based capture systems that require expensive chemical solvents and pose environmental risks, CaL utilizes limestone, a material already abundant and essential in cement plants as a high-temperature solid sorbent to capture CO2. As illustrated in Figure 1, the CaL process operates through a dual fluidized bed system involving a carbonator and a calciner. Limestone, a primary raw material in cement production, is also used as a sorbent in this CaL process. This dual use creates a unique industrial symbiosis between the CO2 capture unit and the cement production line, making the process highly efficient and cost-effective compared to other carbon capture methods (1–3).

From a performance perspective, experimental results and pilot studies have consistently demonstrated that CaL can achieve CO2 capture rates above 90%, with some optimized configurations reaching up to 98% efficiency (2). Various studies have developed and tested different integration options for CaL in cement plants, including fluidized bed reactors and entrained flow reactors. These configurations have been validated at semi-industrial scales, demonstrating their feasibility and robustness under realistic operational conditions (1,4).
Beyond emissions reduction, the integration of CaL offers significant energy transition opportunities. The process generates high-grade heat that can be recovered to drive steam cycles for power generation, thereby improving the plant’s overall thermal efficiency. Furthermore, the integration of CaL with cement production can lead to substantial reductions in primary fossil fuel consumption. For instance, using alternative fuels like natural gas or sustainably sourced biomass instead of coal in the calciner can further improve the process’s environmental performance (5). Life cycle assessments indicate that when biomass is employed as a fuel source in the CaL process (Bio-CaL), it effectively acts as a Bio-energy with Carbon Capture and Storage (BECCS) system. This configuration can result in a net-negative CO2 emission scenario, effectively removing carbon from the atmosphere while producing cement (5).

Despite the high technical readiness and clear synergies, the commercial deployment of CaL technology in Indonesia is hindered by significant financial barriers, primarily high initial capital expenditure (CAPEX) and operational costs (OPEX). Currently, there is a critical gap in knowledge: a lack of validated financial models that specifically link the technical performance of CaL in the Indonesian context with emerging climate finance mechanisms.

This research aims to bridge that gap by developing a robust investment and financing model for deploying Calcium Looping technology in Indonesia’s cement industry. By combining IPCC Tier 2 emission baselines with rigorous thermodynamic simulations, we will determine the precise technical parameters and the Levelized Cost of Carbon Abatement (LCCA).
The ultimate output will be a Bankable Decarbonization Roadmap that identifies innovative financing pathways, including Carbon Pricing, Green Bonds, and international climate funds to make CaL deployment financially viable. This project will demonstrate how decarbonization can transform from a cost burden into a competitive advantage, enabling the Indonesian cement industry to access global markets requiring “”Green Cement”” and supporting the nation’s Net Zero Emission targets.”