Quantifying the co-benefits of energy-efficiency policies: A case study of the cement industry in Shandong Province, China

In 2010, China's cement industry accounted for more than half of the world's total cement production. The cement industry is one of the most energy-intensive and highest carbon dioxide (CO2)-emitting industries, and thus a key industrial contributor to air pollution in China. For example, it is the largest source of particulate matter (PM) emissions in China, accounting for 40% of industrial PM emissions and 27% of total national PM emissions. In this study, we quantify the co-benefits of PM10 and sulfur dioxide (SO2) emission reductions that result from energy-saving measures in the cement industry in Shandong Province, China. We use a modified form of the cost of conserved energy (CCE) equation to incorporate the value of these co-benefits. The results show that more than 40% of the PM and SO2 emission reduction potential of the electricity-saving measures is cost effective even without taking into account the co-benefits for the electricity-saving measures. The results also show that including health benefits from PM10 and/or SO2 emission reductions reduces the CCE of the fuel-saving measures. Two measures that entail changing products (production of blended cement and limestone Portland cement) result in the largest reduction in CCE when co-benefits were included, since these measures can reduce both PM10 and SO2 emissions, whereas the other fuel-saving measures do not reduce PM10. •We quantify the co-benefits of PM10 and SO2 emission reductions.•We quantify the co-benefits from energy-saving in China's cement industry.•40% cost effective PM and SO2 emission reduction for electricity-saving measures•Including health benefits reduced the cost of the fuel-saving measures.•Product change measures result in the largest reduction in cost when co-benefit