According to Tolga Egrilmezer, vice president for sales and marketing for the company’s aluminium division, responsible production will also drive premiums higher.
“It’s early days and the market is really still in its infancy, but we absolutely believe that it will continue moving in this direction with the key drivers being consumer demand and regulation,” he told Metal Bulletin in an interview.
Tolga Egrilmezer, vice president for sales and marketing at Rio Tinto Aluminium
“So over time, factors like Aluminium Stewardship Initiative (ASI) certification and carbon footprint have the potential to deliver value for customers in their end markets, and therefore drive premiums,” he added.
Producers of “green” aluminum, which has a reduced carbon footprint, have already been charging a premium price for their products, although it is not clear what price range is being achieved. Other producers include Alcoa, Norsk Hydro and UC Rusal.
In 2016, Rio Tinto launched the RenewAl brand, the world’s first certified low CO2 primary aluminium brand. It has CO2 content of under four tonnes, around a third of the global industry average, plus customized customer services ranging from technical expertise to traceability, CO2 reduction strategies, life cycle analysis and co-branding.
“In other words, because recycling is not enough, RenewAl is a cleaner start to the product life cycle,” Egrilmezer said.
Egrilmezer leads Rio Tinto Aluminium’s global sales, marketing, technical and product development teams, and will be speaking on the executive panel at Metal Bulletin’s 33rd International Aluminium Conference
in Berlin on September 12-14.
“Rio Tinto sees aluminium – as I’m sure the industry does – as a metal of the future. We’re only scratching the surface of the opportunities and the role it can play in our everyday lives. As part of this future, we expect leadership in responsible production and sustainability will become increasingly important for our customers and the consumers who buy their products,” he added.
Rio Tinto was a founding member of the ASI, a global initiative involving a cross-section of aluminium industry producers, users and stakeholders including leading consumer electronics firm Apple, automakers BMW and Audi, plus conservation organizations the World Wildlife Fund and Union for the Conservation of Nature.
Rio Tinto recently secured the industry’s first performance standard and chain of custody standard certifications from the ASI, achievements that Egrilmezer believes are a “pioneering step” for both Rio Tinto as well as the aluminium industry and its customers.
ASI’s standards cover a broader range of sustainability issues and are applicable to all stages of aluminium production and transformation, refining and re-melting of recycled scrap, as well as material stewardship criteria relevant to downstream users of aluminium.
“It makes us the first company selling aluminium that customers can be assured has been produced to the highest environmental, social and governance standards,” he said.
According to Egrilmezer, who is a member of the ASI board of directors, the certification process required a significant amount of work with both the ASI and the third party auditors who carried out an independent verification against the standards.
“They spent time at the sites that have been certified, covering the entire supply chain from our Gove bauxite mine in Australia to our alumina refinery, aluminium smelters and casthouses in Quebec,” he said.
“This is a wide ranging audit process covering not just greenhouse gas emissions but areas such as waste management, material stewardship and human rights. And finally we were required to demonstrate that material can be traced through a ‘chain of custody’ spanning these sites,” he added.
Rio Tinto is now working with the ASI on audits and certifications for other sites in its global aluminium business.
“We expect our certification will encourage others to follow, both upstream and extending into downstream aluminium use sectors such as automotive, construction and packaging. This can have measurable social and environmental impact and creating further momentum for sustainability,” he said.
“We believe the ASI certifications and our RenewAl brand complement each other, allowing Rio Tinto to offer what is truly a unique range of products and service to meet the future needs of our customers,” he added.
The company plans to go one step further: it recently announced a joint venture between itself and US producer Alcoa
, with support from the governments of Canada and Quebec plus Apple, to license and sell technology creating carbon-free aluminium.
The new company, Elysis, will receive funding totaling C$188 million ($146 million) and is headquartered in Montreal with a research facility in Quebec’s Saguenay-Lac-Saint-Jean region.
The technology will produce oxygen while cutting out all direct greenhouse gas emissions from the traditional smelting process.
“This promises to be real step-change for the industry by bringing carbon-free aluminium smelting technology to the market,” Egrilmezer said.
“Apple chief executive officer Tim Cook has said he looks forward to one day being able to use aluminium produced without direct greenhouse gas emissions in the manufacturing of their products. At the end of the day, this is all about supporting a growing role for aluminium in our world and catering to the demand we expect our customers will have for sustainable products,” he added.
According to Egrilmezer, analysts predict the use of aluminium in lightweight cars and trucks in North America alone, will increase by more than 40% over the next 20 years.
“For every 10% reduction in the weight of a vehicle, fuel economy increases by around 7%. Each kilogram of aluminium that replaces heavier materials in a car or light truck can save a net 20 kilogram of CO2 emissions over the life of the vehicle,” he told Metal Bulletin.
“So there is every reason to see a strong future for aluminium that is fundamentally linked to sustainability and now is the time for our industry to move in this direction,” he added.
See also: HOTTER ON METALS: Elysis could revolutionize aluminium smelting technology