Climate and Competitiveness Border Carbon Adjustments in Action 2025

Company and sector profile UltraTech Cement, the largest cement producer in India, has been strategically chosen as a case study due to its pan- India presence, high market share (20% market share in India) and leadership in sustainability actions. The company has a consolidated capacity of 192.26 million tonnes per annum of grey cement, including India and overseas. It has 34 integrated manufacturing units, 34 grinding units, one clinkerization unit and 10 bulk packaging terminals. The cement sector is highly energy- and emissions-intensive, contributing significantly to global CO2 emissions. Reducing these emissions requires fuel alternatives, clinker substitution and energy efficiency measures. Business exposure and response Figure 2 illustrates the EU CBAM trade exposure of the cement sector in BASIC countries. The vertical axis shows the carbon payment per dollar of EU production and imports (%) – 64.73% for India, which is higher than Brazil but lower than China and South Africa. Trade dependence, measured as the share of India’s total cement exports destined for the EU, is 11.48%, higher than both China and South Africa. Although the Indian cement industry has moderate direct exposure to the EU CBAM, indirect exposure through supply chains remains a concern. Analysts expect this indirect exposure of UltraTech to rise over the next three to five years as global supply chains become more carbon-regulated. In response, UltraTech has taken various measures, including committing to the Science Based Targets initiative (SBTi)48 in 2021, enhancing energy efficiency through the implementation of clinker cooling systems and expanding the use of renewable energy sources. As of the 2025 financial year, UltraTech was operating 1,020MW of renewables and 351MW of waste heat recovery systems (WHRS). It also uses alternative fuels such as municipal solid waste and agricultural waste.The company applies an internal carbon price of $10 per tonne of CO2 and is adopting innovative technologies, including Coolbrook’s RotoDynamic Heater™ (RDH) and University of California, Los Angeles’ (UCLA) ZeroCAL process for low-carbon operations. It has also set targets through the initiatives RE100 and EP100,49 and is the first Indian company to issue dollar- denominated sustainability-linked bonds. To reduce Scope 3 emissions, UltraTech has developed a sustainable supply chain framework that identifies 160 suppliers to apply sustainability criteria for fuel, raw materials and packaging. As of the 2025 financial year, UltraTech has inducted over 600 LNG, CNG and electric trucks into its logistics fleet. Additionally, the company is gradually transitioning its logistics operations towards achieving net-zero emissions. While these actions strengthen overall sustainability performance, they do not directly impact EU CBAM obligations, which primarily focus on Scope 1 and 2 emissions for the cement sector.CASE STUDY 4 India – UltraTech Cement Key takeaways and potential actions UltraTech is an example of how a private-sector entity can navigate the impact of BCAs by devising strategic action plans that include: –A sustainable supply chain framework to minimize the supply chain emissions. –Innovative mechanisms, such as sustainability bonds, that can be adopted to mobilize the necessary finance for sustainability projects. –An internal carbon price to prepare organizations to manage future risks. Climate and Competitiveness: Border Carbon Adjustments in Action 16