Aluminium demand will rise 40% by 2030. Here’s how to make it sustainable

Global aluminium demand will increase by almost 40% by 2030, according to a recent report conducted by business intelligence analysts CRU International on behalf of the International Aluminium Institute (IAI).

The aluminium sector will need to produce an additional 33.3 metric tons (Mt) to meet demand growth in all industrial sectors – from 86.2 Mt in 2020 to 119.5 Mt in 2030. Transportation, construction, packaging and the electrical sectors will drive demand and account for 75% of the total metal required.

About 70% of globally-produced aluminium is still primary aluminium. The stages of primary aluminium refining and smelting are very energy intensive. Consequently, the CO2 emissions resulting from the primary aluminium production process are also significant.

According to IAI’s global average data, the process of alumina digestion and alumina smelting with GHG emissions of 1.8 and 12.8 t CO2e per tonne of aluminium, respectively, represent the biggest share in global average for primary aluminium emissions, equalling to 16 t of CO2e per ton of primary aluminium.

Since the individual producers’ carbon footprint greatly depends on the use of energy source, where and how primary aluminium is produced matters greatly. The best producers in class currently emit around 4t of CO2 per tome of primary aluminium, which is 3-4 times less CO2 than the global average.

These remarkable results are achieved by utilization of several decarbonization levers, the most critical being the reliance on stable and continuous access to zero-carbon electricity supplies. Moving below these numbers will require the use of new technologies and additional investments.

The broad objective for deep industry decarbonization across hard-to-abate sectors, including aluminium production decarbonization lies at the heart of the First Movers Coalition (FMC), which brings together over 100 member companies and governments. Sending a strong demand signal for low-carbon primary aluminium produced with less than 3t of CO2 per tonne of aluminium from a coalition of FMC buyers is helping to surface supply of deeply decarbonized product.

According to A Roadmap for Decarbonizing Australian Alumina Refining, an industry guide released by the Australian Renewable Energy Agency (ARENA), there are two potential emission abatement pathways for the primary aluminium refining: an “innovator abatement pathway” where technologies are deployed quickly, and “gradual abatement pathway” where technologies are deployed over a longer timeframe to more fully account for potential barriers. Both pathways rely on the use of key decarbonization technologies: mechanical vapour recompression and electric boilers (Bayer process), electric and hydrogen calcination (calcination), and use of thermal storage. For aluminium smelting, the breakthrough in emission reduction would require significant commercial upscaling of inert anodes technology.

The use of new technology in refining and smelting is, across the board, coupled with the switch to renewable energy and utilization of carbon capture systems.

The experience of the FMC members illustrates that there is no silver bullet and no one simple solution to a complex problem each individual aluminium producer face. On the contrary, each producer needs to set its own individual emission reduction targets, stretching and motivating, as in the case of Norwegian Hydro, backed by multi-layered decarbonization strategies.

Decreasing primary aluminium production emissions requires continuous investments in various technology innovations, renewable energy sources, and people. The experience of Companhia Brasileira de Alumínio (CBA) speaks to it: “To lower our emissions, we are pushing for 100% use of renewable power, investments to substitute natural gas for biomass in our Alumina boilers, smelter technology upgrade, and new skills,” says the company's CEO Luciano Alves.

The silver lining in this story on the hard-to-abate aluminium industry derives from the metal’s infinite recyclability. Secondary, recycled aluminium today makes up one-third of global aluminium supply. There are estimates that as much as 75% of all aluminium ever produced, equalling to 1.5 billion tonnes, is still in circulation.

The recycled aluminium, derived from scrap metal, is produced with 95% of the energy savings required to produce primary aluminium. Subsequently, the GHG emissions in the production of recycled aluminium are substantially lower, which is why the spotlight nowadays is on recyclers and the production of low-carbon recycled products. The growing demand is met by promising investments, some of which are made jointly by value chain partners as in the case of recyclers and their product customers.

A good example is the collaboration between Novelis and Ball Corporation, both FMC members. The two companies have a closed-loop arrangement in place, and also work together with other stakeholders around the world to improve recycling rates and increase the availability of aluminium scrap for recycling.

The recycling industry uses scrap which, when melted and casted, is turned into recycled aluminium products used by variety of industries. Work remains to develop a harmonized approach to carbon content in recycled products, definition of scrap inputs, scrap availability, product circularity, carbon-related policies, and other issues.

While a consensus exists on the treatment of post-consumer scrap bearing zero emissions, different treatment of pre-consumer scrap continues to be a stumbling block for the industry. This lack of a level playing field among market participants is particularly confusing for the buyers of final aluminium products, but no less for the industry players themselves. Having clear rules would ease the collaborations and low-carbon products uptake.

While it was once trendy, decoupling of primary and secondary production has now reversed. A growing number of primary producers are diversifying towards recycling. Recycling has become the leading short- to medium-term marketing strategy for many primary producers in a post-Covid environment. This is coupled with their mid- to long-term decarbonization goals set by the sector transition strategy for primary production, which require substantial investments in innovations, new technologies, reliable access to renewable energy and people.

Growing partnership efforts to decarbonize primary aluminium production through innovation and market consolidation efforts aimed at increased efficiencies in collection and production of recycled aluminium reconfirmed the role of both primary and secondary aluminium in tomorrow’s world. Making the future greener for its direct and end-users requires upscaling of production of deeply decarbonized primary aluminium and increased production of carbon-traceable secondary aluminium – because the world needs both.