Making Aluminum takes a lot of energy - China comes up short

Energy shortages and high energy prices are hurting aluminum producers. The raw material to make aluminum is bauxite. Aluminum ore is plentiful, but turning it into aluminum takes a lot of electricity to strip the oxygen from the metal. The cost of electricity is the major cost for producing aluminum. A major factor for locating an aluminum production plant is availability of cheap electric power.

China’s growing energy demands are resulting in coal shortages and in turn electricity shortages. In order to reduce electric demand, China is cutting output of aluminum by as much as 10% at some plants to reduce electricity demand. China just had prices from iron ore suppliers raised by 70% or more and are also feeling the effects of much higher shipping prices.

Chinese exports of aluminum, steel and other products that require large amounts of imported raw materials and energy may be constrained in the future. This will affect supplies and pricing world-wide. Prices will rise. Producers in countries with low power costs and close to supplies of raw materials will benefit.

Iceland, which has abundant electric power from hydroelectric and geothermal plants, has built a large aluminum processing plant. They import bauxite ore and export aluminum metal. This is an excellent way for them to make use of their inexpensive electric production. Their aluminum refinery will not generate the large amounts of carbon dioxide that are required to run the Chinese plants. Substitution of Iceland aluminum for Chinese aluminum will benefit our environment.

China is not a very energy efficient country. Their carbon footprint is terrible as most of their electricity is produced from low-grade coal which releases a very large amount of carbon for the amount of energy produced. China now produces more carbon dioxide than the United States, but has an economy only about one-quarter the size. One way to cut back on energy use and the terrible pollution that comes with it is to shut down very energy intensive industries like aluminum production. This will also help combat global warming, but their reason for doing this is economic.

I believe that China will come to realize that producing ever larger amounts of power from coal will not work in the long run. They will accelerate their development of clean, renewable energy and could become a market for American technology and equipment to produce clean power.

Topics: Global Warming , Coal , Carbon Dioxide , China , electricity , Iceland , aluminum