Developing Innovations for a Sustainable Low-Carbon Society

At the 29th Conference of the Parties to the United Nations Framework Convention on Climate Change (COP29), one of Thailand’s key presentations focused on driving the country’s Nationally Determined Contributions (NDCs) action plan to achieve a 43% reduction in greenhouse gas (GHG) emissions from the initial target of 30-40%, equivalent to approximately 222 million tons of carbon dioxide equivalent (tCO2e)

1. Energy Transition from Fossil Fuels to Clean Energy

SCG has established both short-term and long-term greenhouse gas emission reduction targets in accordance with the Paris Agreement to limit global temperature rise to no more than 2 degrees Celsius, with efforts to keep it below 1.5 degrees Celsius by 2050, compared to pre-industrial levels. In 2021, SCG joined the Science Based Target initiative (SBTi), which certifies organizations’ targets according to scientific calculation standards. In 2023, SCG received SBTi certification for its near-term targets to reduce GHG Scope 1 and 2 emissions by 25% by 2030 compared to the base year of 2020 and decrease GHG Scope 3 emissions from fossil fuel sales to external customers by at least 25% by 2031, compared to the base year of 2021.

While the SBTi certification marks a significant milestone in SCG’s journey toward building a green society, numerous challenges remain as success requires cooperation across all sectors, including government agencies, private organizations, and civil society, both at national and global levels, such as the Federation
of Thai Industries, the World Business Council for Sustainable Development (WBCSD), the UN Global Compact Network Thailand (UNGCNT), and the Thailand Business Council for Sustainable Development (TBCSD), with the goal of joining forces to accelerate Thailand’s transition to a low-carbon society while leaving no one behind.

Performance indicators

25.48 million tons
GHG emissions in 2024
Target: Net zero GHG emissions by 2050

25.59%
GHG Scope 1 and 2 emissions reduction in 2024
Target: Reduce GHG Scope 1 and 2 emissions by 25% by 2030 compared to the base year 2020

20.66%
GHG Scope 3 emissions reduction from fossil fuel sales to external customers
Target: Reduce GHG Scope 3 emissions by 25% by 2031 compared to the base year 2021

7.91%
energy consumption reduction compared to BAU baseline in 2007

Recognizing that the energy sector accounts for 70% of national greenhouse gas emissions compared to other sectors, SCG is committed to leading the transition from fossil fuels to renewable energy (RE) and alternative fuels (AF), completely phasing out coal (Zero Coal) and fossil fuel-generated electricity (Zero Power) from its production processes. In addition, SCG strives to raise awareness among industrial associations, government bodies, and private sectors, with the ultimate goal of elevating Thailand’s green industry to global recognition

A sustainable transition to a low-carbon society requires balancing net-zero emissions goals with economic development. In 2024, SCG strengthened this balance through strategic initiatives and awareness campaigns on various platforms at both national and international levels, including the ESG Symposium 2024. Furthermore, SCG has demonstrated its commitment to collaborating with government
agencies and engaging with key policy developments, such as the European Union’s Carbon Border Adjustment Mechanism (CBAM) and Thailand’s Climate Change Act, which aims to achieve net-zero emissions across Thailand by 2065.

Expanding Solar Power Usage

SCG has actively been installing solar power systems across its plants and has developed SCG Cleanergy in tandem to provide comprehensive clean energy solutions to the industrial sector. As part of its commitment to driving a more extensive transition from fossil fuels to clean energy, SCG has also introduced solar power-based services through its Smart Grid system, collaborated with the government to advance grid modernization, and developed innovative heat batteries for energy storage to enhance thermal energy efficiency.

• Smart Grid: A major limitation for many plants looking to adopt solar power is installation space. Some facilities lack adequate space for solar panels or can only install less than their energy needs, while others have excess space and surplus solar power production capacity. To address this issue, SCG Cleanergy has developed a Smart Grid management system, operated via the SCG Cleanergy Platform, which facilitates power trading between operators. The system transmits electricity through

292 megawatts: Total installed solar power capacity within SCG

485 megawatts: Total renewable electricity traded through SCG Cleanergy’s Smart Grid system to government and private sectors in 2024

transmission lines that are connected to factories and the Provincial Electricity Authority’s grid through the SCG Cleanergy Platform, which records electricity usage and carbon credit data for the purpose of carbon footprint offsetting. The solution is particularly effective in managing multiple factories in industrial estate areas as it optimizes efficient solar power usage and thus promotes clean energy usage. Solar solutions can be installed as a solar rooftop on factory roof space, a solar farm in a vacant area on the plant property, or a floating solar on unused water surfaces.

• Energy Storage: Another limitation facing solar power adoption is storing excess energy produced during daytime for use at other times or converting it into other forms of energy. To address this, SCG Cleanergy has invested in heat battery technology developed by a US-based startup. This technology converts electrical power from wind and solar sources into stored thermal energy, which can later be converted to power turbines for electricity generation or produce high-temperature steam for certain industries. This technology can help reduce fossil fuel use and GHG emissions in the industrial sector. SCG is currently studying its implementation in the cement industry at its Tha Luang plant, which would be the world’s first such application. In 2024, SCG began manufacturing heat battery components for export to U.S. industrial customers.

Advancing Grid Modernization Through Collaboration

As Thailand’s draft Power Development Plan (PDP) targets 1,000 megawatts of power generation through Grid Modernization and the Energy Regulatory Commission has announced the launch of the ERC Sandbox project to test technology-powered energy services, SCG has joined the initiative to explore private-sector electricity trading using government transmission lines as a model. In 2023, SCG Cleanergy secured approval for four projects totaling 6.308 megawatts as well as established PPP cooperation agreements for equipment installation, power distribution testing, and electricity trading through its platform, with successful implementation in 2024.

SCG has also planned to participate in a 2,000-megawatt renewable energy trading pilot project through a direct power purchase agreement (direct PPA) using third party access (TPA) services, to supply electrical power to global data center industry leaders in 2025.

Once clean energy is successfully expanded from a smart grid to provincial and regional modernized grid networks, Thailand will have an opportunity to transition to a low-carbon society in a sustainable way. While this development requires coordinated government policy and legal leadership, SCG is prepared
to contribute innovations and engage with all sectors in order to drive Thailand toward such a future.

Increasing Alternative Fuel Usage

SCG has developed various innovations to increase the use of different alternative fuels in its plants in place of coal. This includes biomass fuels, which leverage Thailand’s agricultural abundance and substantial agricultural waste materials, and industrial and community waste, which can be converted
into refuse derived fuels (RDFs). SCG also promotes energy crop cultivation and purchases energy crops from farmers and communities for use as alternative fuels, such as Napier grass and bamboo, which helps generate income for communities and fosters participation in the transition to a low-carbon society the transition to a low-carbon society.

• RDF: RDF is an alternative fuel derived from industrial and community waste materials. SCG collects these materials from areas surrounding its cement plants in Saraburi, Lopburi, Kanchanaburi, Ayutthaya, Lampang, Chiang Mai, Chiang Rai, Nakhon Si Thammarat, and Nakhon Ratchasima, and utilizes them as fuels to generate thermal energy in its cement plants. In 2024, SCG upgraded its machinery capabilities to accommodate various types of RDFs with different qualities, improved its plastic waste incineration for fuel gas production to reduce plastic processing costs, and introduced an external combustion chamber technology to enhance alternative fuel efficiency.
• Biomass SCG promotes energy crop cultivation and sources energy crops from farmers through contract farming systems to increase its biomass fuel reserves for future needs. In addition, SCG has developed.

28.59 %
Proportion of alternative fuels used in 2024 3.21 MtCO 2e of avoided GHG emissions per year from the use of 30.17 million tons of alternative fuels in place of fossil fuels in 2024

biomass fuel technology to utilize and convert difficult-to-use agricultural materials, such as tree stumps, corn, cassava rhizomes, and Napier grass, which has high moisture content, into higher quality biomass fuels by processing them into energy pellets, suitable for industries requiring consistent fuel quality, and biocoal.

As part of the Saraburi Sandbox project, SCG has initiated a pilot program to promote the cultivation of energy crops, such as bamboo and Napier grass, in Saraburi as part of the Saraburi Sandbox project to provide farmers with stable market access and predictable pricing for these crops. Building on this success, SCG has also extended Napier grass cultivation to Mae Chaem District in Chiang Mai and Mueang Lampang District in Lampang, offering farmers an alternative to traditional corn farming while also mitigating PM 2.5 pollution from agricultural waste burning. In addition, SCG has collaborated with the Forest Industry Organization (FIO) to establish experimental bamboo plantations in Saraburi and Lampang.

SCG’s Participation in Clean Energy Development in the Saraburi Sandbox

• Promoted and increased alternative and renewable fuel usage in the local cement industry to 26%
• Collaborated with Princeton University to study the potential of areas for facilitating the transition
  to clean energy.
• Collaborated with the Provincial Electricity Authority to install a 412-kilowatt solar carport in the Saraburi Government Center parking area using the ESCO Model and install a floating solar
  farm in Bueng Ban Chang Lake in Ban Mo District on a 154-rai raw water reservoir of The Siam
  Cement (Tha Luang) Company Limited
• Partnered with the National Land Policy Committee(NLPC) to promote energy crop cultivation, particularly
  Napier grass, in Kaeng Khoi District, Saraburi, over a total area of more than 100 rai, capable of producing 2,100 tons of alternative energy, generating 2.5 million baht in annual income for farmers, and reducing GHG emissions by 2,500 tCO2e.

2. Leader in Low-Carbon Cement: Relentlessly Advancing Innovation

The integration of low-carbon products into SCG’s portfolio is a key strategy in achieving its net-zero greenhouse gas emissions target by 2050. This aligns with Thailand’s national goal of transitioning
to a green economy. SCG actively develops innovative low-carbon products and fosters collaborations across sectors to promote sustainable industrial production and consumer behavior.

Low-Carbon Cement: Meeting Environmental and Industrial Needs

SCG plays a key role as a leader in building materials industry, committed to developing low-carbon products to support global sustainability goals.. As the first cement manufacturer to receive the Environmental Product Declaration (EPD) label in the United States, SCG has exported over 1 million tons of low-carbon cement. In 2024, SCG planned to expand EPD-certified products in the domestic market to 53, including:
• 8 cement products
• 10 mortar products
• 27 concrete products
• 8 export products

Furthermore, SCG is pursuing EPD certification in North America for two additional products from Vietnam, while expanding into ASEAN and global markets. Reinforcing its position as the first company to receive EPD certification across all product categories, reflecting transparency and a strong commitment
to comprehensive environmental impact reporting.

512,431 tCO2e: SCG’s low-carbon cement production in 2024 helped reduce GHG emissions.

Elevating Low-Carbon Innovation

SCG’s decarbonization strategy extends beyond low-carbon cement. Green loans are utilized to support CO2 reduction initiatives, reinforcing SCG’s brand leadership in environmentally friendly products.

• Expanding into the Middle East with 3D Printing Mortar: SCG is the first to develop 3D printing mortar using low-carbon cement, backed by over a decade of patented research. This innovation reduces greenhouse gas emissions by more than 15%. SCG has shifted its business strategy
  from providing 3D printing construction services to selling 3D printing mortar with technical support, enhancing market opportunities in the Middle East. The first batch has been successfully exported to Saudi Arabia, with plans to expand further into South Asia, the Middle East, and Africa (SAMEA) to meet the growing demand in construction and industrial sectors. SCG also aims to extend its 3D printing product applications to both construction and furniture, addressing diverse global market needs.

• Driving a Circular Economy: SCG actively incorporates industrial waste materials, such as fly ash from power plants, into cement mixtures. This strategy reduces natural resource consumption and green house gas emissions while maintaining product quality, promoting a sustainable economic model.

• Ultra-High Performance Concrete (UHPC): SCG collaborates with government and private organizations to advance UHPC technology for infrastructure applications, including bridge girders, bridge joints, warehouse and factory beams, and specialized pavements for heavy loads. UHPC offers superior strength and durability, making it ideal for load-bearing structures while enabling more efficient designs with reduced material usage. It also enhances construction speed and lowers life-cycle costs by minimizing maintenance needs, as its low permeability prevents steel corrosion. Additionally, UHPC contributes to sustainability by reducing carbon dioxide emissions by 20-60%. SCG has successfully implemented UHPC in several projects, including bridges at SCG Headquarters in Bang Sue, the Yellow Bridge in Thung Song, Nakhon Si Thammarat, the RY.4060 road bridge in Khao Chamao and Kaeng Hang Maeo, Rayong-Chanthaburi, and the CCTC Workshop CPAC building in Bang Son. SCG continues to expand UHPC applications through ongoing collaborations with public and private sector partners.

Transitioning to a Low-Carbon Industry

In 2024, SCG, as a Thai Cement Manufacturers Association (TCMA) member, in collaboration with the Saraburi Provincial Industrial Council and provincial authorities, advanced the Saraburi Sandbox project, a low-carbon city model, by joining the World Economic Forum’s (WEF) Transitioning Industrial Clusters
Initiative, marking Thailand’s first such industrial cluster, the third in ASEAN, and the twenty-first globally to do so. The initiative aims to transform Thai industry toward a low-carbon economy and society through
a public-private-people partnership, which represents a significant challenge.

Furthermore, SCG has partnered with the Global Cement and Concrete Association (GCCA) to secure green funding from the Canadian government. Administered through the United Nations Industrial Development Organization (UNIDO), the green funding supports the Thai cement and concrete industry’s transition toward its 2050 net-zero GHG emission target.

3. Advanced Technology Research for Net Zero

Carbon Capture, Utilization, and Storage (CCUS) technology is central to SCG’s 48% GHG emission reduction. Utilizing the Marginal Abatement Cost Curve (MACC), SCG evaluates project investments and assesses the readiness of green infrastructure, including carbon storage areas, transportation systems, and government support, including both legal frameworks and funding.

• Hydrogen Production: SCG researches cost-competitive hydrogen production and
  its integration with captured carbon dioxide to create high-value-added products.
• Oxyfuel Technology: SCG is researching oxyfuel technology to reduce GHG emissions in cement production by replacing fossil fuel combustion with pure oxygen. This
  process increases the combustion temperature, reduces exhaust gases, and simplifies carbon capture. It prepares factories for future integration with high-efficiency carbon capture solutions. Additionally, oxyfuel technology helps reduce other pollutants from air-based combustion, improving the efficiency of alternative fuels such as biomass and reducing reliance on fossil fuels.
• Biochar Carbon Removal: SCG has developed Biochar technology as part of its Green Circular Business initiative. This process transforms agricultural waste biomass into Biochar, which is used to improve soil quality and in concrete applications for long-term carbon storage. In collaboration with Chiang Mai University, SCG has applied Biochar concrete in the construction of roads and pavements, covering an area of 4,900 square meters at Chiang Mai University. This project also serves as a model for addressing PM2.5 pollution in northern Thailand. Furthermore, SCG received funding from the Japan Carbon Frontier Organization (JCOAL) in 2024 to explore the conversion of agricultural waste into Biochar, which will be used as a coal substitute and a carbon storage medium in both soil and concrete. This initiative is a crucial step in promoting sustainability and advancing carbon-neutral solutions.