Cement Firms’ Green Power Capacity to Reach 6 GW by FY28: ICRA

India’s major cement companies are expected to significantly expand their green power capacity over the next two years as the industry focuses on reducing energy costs and accelerating decarbonisation.

According to rating agency ICRA, green power capacity across major cement companies is projected to reach around 5.8–6.0 GW by March 2028, compared with approximately 4 GW in March 2026.

The cement sector is expected to invest around ₹12,000–13,000 crore over the next two years to expand its renewable power capacity. ICRA estimates that this additional green power capacity could generate annual savings of approximately ₹6,200–6,700 crore, translating into an estimated payback period of 1.8–2.2 years.

Rising fuel-price volatility, increasing energy costs and corporate decarbonisation targets are encouraging cement manufacturers to increase their dependence on renewable and green energy sources.

According to ICRA’s estimates, every 5% increase in green-power replacement could reduce power and fuel costs by around ₹15–16 per tonne. At a 25% green-power replacement level, cement manufacturers could potentially achieve savings of ₹75–80 per tonne, which may also support improvements in operating margins.

Alongside renewable power expansion, cement manufacturers are adopting several other measures to reduce their carbon footprint. These include increasing the use of blended cement, alternative fuels, improving clinker efficiency and exploring green financing opportunities.

The growing adoption of green power highlights how the cement industry’s decarbonisation challenge is increasingly being linked with cost-saving opportunities. With substantial investments planned through FY28, renewable energy is expected to play an increasingly important role in the sector’s energy strategy.