Aluminum has been described as a “miracle steel.” Whereas it’s probably the most plentiful steel within the earth’s crust, the complexities concerned with refining it made aluminum extra valuable than silver or gold throughout the nineteenth century. Napoleon III so valued it that he would serve his most honored friends their meals on aluminum plates. It stays a high-value materials as we speak, prized for its light-weight versatility, military-grade power, resistance to corrosion and since it’s infinitely recyclable.
So, what’s to not like? Nicely, the energy-intensive collection of processes that flip uncooked bauxite ore right into a pure steel emit on common 16 metric tons of CO2 for each metric ton of main aluminum produced. The sector as a complete generates round 1.1 billion metric tons of CO2 annually, accounting for two p.c of worldwide man-made emissions. Greater than 60 p.c of those emissions come from producing the electrical energy consumed throughout the smelting course of.
What’s extra, demand for the miracle steel — pushed by industries similar to transportation, building, packaging and {the electrical} sector — is predicted to improve by nearly 40 p.c by 2030. Two-thirds of this development is predicted from China and Asia, a priority given China’s smelting course of is closely reliant on captive coal-fired energy crops. With out advances in recycling and decarbonization, the sector’s emissions may careen in the direction of practically 2 billion metric tons by 2050.
Robust goal from First Movers Coalition
A handful of latest applied sciences maintain the potential to wash up aluminum, however solely probably the most bold meet the powerful goal of the World Financial Discussion board’s First Movers Coalition (FMC), a world initiative to harness the buying energy of firms to decarbonize the planet’s heaviest-emitting industries. Members of the FMC have dedicated to a aim that no less than 10 p.c of the first aluminum they procure yearly by 2030 shall be produced through near-zero emissions processes. The definition of “close to zero” is the powerful bit: emitting lower than three metric tons of CO2 per metric ton of main aluminum. That represents an enormous discount in present emissions of 85 p.c or extra.
To know obtain such deep decarbonization, we’d like a speedy tour of the aluminum manufacturing course of. Bauxite is the uncooked materials — it’s mined from the bottom and refined into aluminum oxide, or “alumina,” by way of a multi-phase course of that features heating it to round 1,000 levels Celsius. To realize this warmth, many refineries burn fossil fuels onsite, which emit giant quantities of CO2 within the course of. The second course of, often called smelting, turns the alumina into pure aluminum steel by way of electrolysis, which makes use of a whole lot of electrical energy and carbon anodes that additionally emit giant quantities of CO2.
Present types of renewable power — similar to hydro or photo voltaic — will get us about two-thirds of the way in which to zero-emissions aluminum.
The excellent news is that current types of renewable power — similar to hydro or photo voltaic — will get us about two-thirds of the way in which to zero-emissions aluminum. We are able to use clear power for the brand new electrified boilers and calciners concerned in refining bauxite ore into alumina — and in addition for the electricity-intense smelting course of. However this may be costly within the quick time period. It means shifting the crops to areas with entry to renewable energy and retrofitting the refineries to put in the brand new gear.
Some rising new applied sciences — which could be applied at current aluminum crops — will help slim the hole in the direction of zero-emissions aluminum. The smelting course of could be totally decarbonized by changing these carbon anodes with inert anodes that emit oxygen as an alternative of CO2. A course of often called “mechanical vapor recompression” allows the thermal power wanted for refining to be recycled fairly than launched. And for the remaining emissions, there are applied sciences similar to carbon seize, use and storage (CCUS) to intercept emissions from each the refining and smelting processes. When a couple of of those breakthrough applied sciences are utilized in conjunction, they’ll get the entire aluminum manufacturing course of under the brink of three metric tons of CO2 per metric ton of main aluminum.
In contrast to most different sectors within the FMC, recycling can play a big half within the journey in the direction of decarbonizing the aluminum sector, particularly because the steel is taken into account infinitely recyclable. Recycling takes round 5 p.c of the power wanted to make new aluminum, so it makes business in addition to environmental sense. Aluminum remelting is widespread at scale as we speak with greater than 30 million metric tons of recycled aluminum flowing again to new merchandise yearly. It could actually additionally contribute in the direction of a simply transition, as assortment, sorting and recycling provide the potential to create new jobs whereas decreasing the pure useful resource extraction required to assist main aluminum manufacturing.
Consequently, the FMC has set an extra goal for its members to make sure that no less than 50 p.c of the aluminum they use yearly by 2030 is recycled. Nevertheless, recycling alone received’t be sufficient to slake the rising international thirst for the steel — in actual fact, it should provide simply half the anticipated demand by 2050, in response to the 1.5 levels C-aligned transition technique revealed by the Mission Potential Partnership. So getting main aluminum manufacturing as close to to zero emissions as potential stays a high precedence.
The tech resolution is there. Now to make it occur
Whereas the applied sciences to decarbonize aluminum manufacturing might exist in prototype types, like all new applied sciences which have but to achieve scale, they’re costly. Commercializing them is difficult — and it’s not simply the price; aluminum’s worth chain is sophisticated and prolonged.
Take a beer can, for instance, which is usually fabricated from greater than 50 p.c recycled aluminum however nonetheless requires main aluminum. First you mine the bauxite, then you definately refine it into alumina. It usually goes elsewhere to be smelted into pure aluminum. The steel is then processed into discs or coils, purchased by firms that punch them into cans, bought to beverage companies and bottlers, distributed to retailers and solely then reaches the patron. This lengthy provide chain is compounded by the scale of the patrons. Whereas metal and concrete have large “anchor patrons,” similar to auto producers or state procurement businesses, aluminum is purchased in small quantities by a number of gamers. And all of the gamers concerned — from the mine firm to the beverage retailer — should be aligned to share the aim and the price of decarbonization.
Ball Company, a significant producer of aluminum packaging and a member of the FMC, has made a primary transfer in the direction of aligning with its worth chain companions. The corporate has teamed up with aluminum suppliers and fellow FMC members Novelis and Rio Tinto to create Canada’s first specially-marked, low-carbon beverage can for Corona beer. The can is made partly from recycled aluminum together with near-zero emission main aluminum refined with hydropower and smelted utilizing a greenhouse gas-free inert anode know-how known as Elysis. This breakthrough has been made potential by an unprecedented collaboration between two competing aluminum trade giants — Alcoa and Rio Tinto — together with $13 million (CAD) of funding and technical assist from Apple, plus extra funding of $80 million (CAD) every from the Canadian and Quebec governments. Elysis remains to be on the prototype stage, however the crew is aiming to make the know-how commercially obtainable by 2024.
Aligning the worth chain, by way of coalitions such because the FMC, is important to decarbonization efforts. With out an aligned worth chain, demand alerts to producers might not result in any change. These sorts of coalitions additionally result in higher conversations with governments round a variety of topics, from tightening insurance policies on recycling to co-investing in R&D.
When a breakthrough applied sciences are utilized in conjunction, they’ll get the entire aluminum manufacturing course of under the brink of three metric tons of CO2 per metric ton of main aluminum.
Governments have a key function to play in encouraging the decarbonization of main aluminum refining and smelting. The Center East has a chance to contribute, utilizing its plentiful solar energy potential. China is displaying motion in the correct course, shutting some coal-powered refining operations and opening new crops in areas plentiful with hydropower. However governments can also want to supply direct monetary assist to the sector. The brand new applied sciences wanted to decarbonize aluminum — together with extra renewable energy, CCUS and redesigning the smelting course of round inert anodes — will price round $1 trillion as much as 2050, so it’s probably that states must step in with incentives, funding and market-based measures. The manufacturing of supplies similar to lithium or copper — important to the low-carbon transition — already appeal to authorities subsidies. So, too, should aluminum, given its function in serving to decarbonize different sectors similar to transportation and battery know-how.
In Europe, the European Union’s proposed carbon border adjustment mechanism (CBAM) is a wake-up name to aluminum suppliers trying to export into the one market. By 2030, the CBAM may levy a tax of 100 euros per metric ton of CO2 contained in imported merchandise and supplies, mimicking the price of the E.U.’s emissions buying and selling scheme (ETS) for native producers. For a metric ton of aluminum with a 16 metric ton CO2 footprint, that would add 60 p.c to the price of the steel. Whereas such a mechanism might assist decarbonized aluminum compete on an ongoing foundation as soon as commercialized, the mannequin of direct authorities funding in breakthrough know-how could also be essential to crowd in company finance and derisk the decarbonization pathway.
The sector is in a race in opposition to time to scale-up its nascent near-zero emissions manufacturing to ship the availability required. Firms must take a transparent management place, to assist the deployment of the deep decarbonization applied sciences which might be wanted to align the sector alongside a pathway to web zero by 2050. There shall be extra prices, however coalitions such because the FMC will assist create the transparency and collaboration required to handle these prices. The know-how is there to make it occur — and that’s value elevating if not a glass, then actually a low-carbon beer can.
This text was co-authored by Jonathan Walter, and BCG’s Andrew Alcorta and Henry Mumford.
