Carbon pricing needed to reach Al CO2 goals: Rain

Primary aluminium smelters cannot reach their emissions goals without costly technological measures to deal with emissions from carbon anodes, putting the onus on governments to incentivize such investments by putting a price on carbon, petroleum coke calciner Rain Carbon says.

Carbon supply chain and carbon-related process emissions made up more than half of total emissions from a low-carbon aluminium smelter, according to a case study Rain presented last week at the Argus Global Coke and Carbon Conference in Seattle, Washington.

"Achieving net zero for primary aluminium will not be possible without either inert anodes or carbon capture across the supply chain," Rain Carbon technical services director Maia Hunt said in a presentation detailing Rain's analysis to calculate a smelter's full lifecycle emissions. Rain produced the study using details from the Alouette aluminium smelter in Quebec, Canada, and assuming anode raw materials from Rain's Lake Charles, Louisiana, calciner in order to show an end-to-end emissions analysis of a low-carbon aluminium smelting process.

While a smelter like Alouette operating with renewable power can achieve a target of less than 4t of carbon dioxide equivalent (CO2e) per tonne of aluminium — a standard used by smelters to label certain aluminium products as low-carbon — this only considers direct and indirect emissions, also known as scope 1 and scope 2 emissions, respectively, Rain said. But when considering scope 3 emissions, which are related to supply chains, and thus include coke calcining, meeting this benchmark is much more challenging, according to the calciner.

Rain found that over half of the smelter's "cradle-to-gate" emissions were not related to operating the smelter itself — carbon supply chain and carbon-related process emissions comprised 64pc of total emissions. And anode production, including raw materials calcined petroleum coke (CPC) and coal tar pitch (CTP) and the anode baking, contributed to 21pc of the smelter's overall carbon footprint.

Total carbon raw materials production and transportation amounted to 609kg/t of aluminium, with CPC making up 85pc. This is even when considering that Rain's Lake Charles calciner's carbon emission rate is lower than some other calcination plants, as the plant recovers its waste heat energy, allowing for a 16pc reduction in CPC-related emissions.

But eliminating coke from the aluminium smelting process is a tall order. Carbon anodes that are consumed in the smelting process are an essential feedstock in traditional smelting, but they emit CO2. Inert anodes, which instead emit oxygen, still have a long road ahead before becoming viable at scale in the industry. Existing smelters cannot be retrofitted to use the technology, meaning new smelters would need to be built, requiring significant capital investment, Rain has said.

Calciners need incentives for CCUS

In order to eliminate carbon dioxide emissions while still using carbon anodes, carbon capture, utilization and storage (CCUS) would have to be installed across the supply chain. But this technology is currently prohibitively expensive and the costs would prevent calciners and smelters from competing with global competitors that do not make such investments in emissions reduction.

Rain in 2021 conducted a feasibility study on CCUS to reduce greenhouse gas emissions at its calcination plants and determined that "immediate implementation is not realistic as the technology is cost prohibitive". Capital costs to add CCUS technology at the Lake Charles calciner are estimated to exceed $160mn, although the project would be applicable for some tax credits, Rain said.

But if tax credits for CCUS increase substantially, or if an "aggressive carbon pricing policy is adopted by the US government," the technology may become more economically feasible, Rain said in the study. More efficient CCUS technologies could possibly incentivize installation at calciners, as well, the calciner said.

But one additional concern with this approach is whether carbon policies are implemented evenly across the global market.

China is already an "elephant" in the industry, producing about 58pc of the world's aluminium, up from only around 3pc about 20 years ago, Robert Dickie, an independent carbon market analyst, said at the conference. The country is aiming for 45mn t of aluminium production capacity by 2025.

China is on track to increase its share of global aluminium production, in part because Chinese producers face less stringent environmental standards, Dickie said. Chinese producers can cut costs compared with smelters in North America or Europe by using lower-quality CPC with more impurities because of looser environmental standards, making it tougher for western smelters to compete.

The EU, which has already implemented an emissions trading system to put a price on carbon, is now looking to begin a carbon border adjustment mechanism that would add costs for industries importing heavy emissions products like aluminium from countries without carbon emissions limitations, in order to create a level playing field.

"The western companies will have to figure out how to how to participate in that market to make some money," Dickie said.

By Delaney Ramirez