South32, a diversified mining firm, is exploring solutions for securing green power at the Hillside Aluminium smelter in the Kwazulu-Natal (KZN) area of South Africa.
Given the introduction of carbon border taxes and end-user demand for green aluminium, if South32 is unable to secure an inexpensive supply of low-carbon power for Hillside, this vital KZN business risks becoming uncompetitive in the international market over time.
South32 has begun just transition planning to support options for the smelter if its energy transition is not economically successful and the smelting becomes uncompetitive, due to the smelter's enormous economic and social relevance. Around 30% of Hillside's sales are to South African consumers, supporting local downstream industries and employment. Hillside has played a vital part in KZN's economic growth as one of the region's top industrial employers.
The aluminium smelter also contributes to the national power system's stability, since Eskom can suspend supplies to the smelter to support grid management and minimise the blackout of electricity. However, because of its carbon-intensive power usage, it accounts for a high 58% of the Scope 1 and 2 carbon emissions of the four enterprises that South32 operates, and it is in desperate need of considerable greening.
According to Mining Weekly, preliminary study findings suggest that additional solar photovoltaic and wind capacity, paired with battery storage, might make renewables technically practical. The results of the pre-feasibility study on this project are expected in the middle of this year.
A trial of energy-saving technologies is already underway at the Richards Bay aluminium smelter, with a feasibility assessment and final investment decision likely this financial year. The AP3XLE technology is already in use at Mozal Aluminium, a South32 company in Mozambique.
Alternative processing technologies, such as inert anodes, are being developed to produce carbon-free aluminium smelting. The consumption of carbon anodes in the smelting process accounts for the majority of Scope 1 emissions. Commercialization of alternative processing methods, such as inert anodes or other technical advances, will be required to achieve net-zero operating carbon emissions in the aluminium sector.
South32, which is listed on the ASX, LSE, and JSE, and is led by CEO Graham Kerr, stated at its sustainability briefing that it supports Eskom's efforts to decarbonize by investing in more efficient plants and additional renewable energy infrastructure.
It stated that it intends to collaborate with the South African government, Eskom, and other possible partners to find green energy sources.Hillside has the lowest carbon intensity, compared to Mozal's top-quartile position and South32's second-quartile Alumar aluminium smelter in Brazil, which will be fuelled by long-term cost-efficient renewable electricity.
Aluminium a lightweight metal used in electric cars and construction accounts for 36% of South32's value chain. The company's aluminium smelters use their alumina, which is electrolytically converted to liquid aluminium.
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