Peak aluminium?

The announcement that Rio Tinto is to close its alumina refinery at Gove struck me for a number of reasons, starting with the fact that members of my family are affected by it. First up it’s worth noticing what’s mentioned (the high dollar and low aluminium price, which flows through to bauxite and alumina) and what isn’t (the carbon tax and legislation for its removal). Having claimed that he was going to save industries like alumina and aluminium smelting from the carbon tax “wrecking ball”, Abbott is now shown up, once again, as a fraud[1].

In the short run, the obvious policy implication is that the RBA needs to be firmer in pushing the dollar down. It was, I think, a mistake to hose down talk of direct intervention, as was done recently. Given our declining terms of trade, we should be closer to $US0.80 than $US0.90 now, and heading down further.

The bigger question of interest, though, is the future of aluminium. The big story of the past 10-20 years has been the massive growth of production in China, driven by cheap coal-fired power and lots of subsidies. That’s driven prices down to historically low levels (inflation-adjusted, probably record lows). Production in Australia is now clearly uneconomic, but even the Chinese are losing billions.

Declining prices have driven steady growth in demand for aluminium. Since the supply of recycled aluminium is dependent on past production, there has been a multiplied effect on demand for primary aluminium, which is the big driver of greenhouse gas production in this industry.

The general assumption (as with most trends) has been that these trends will continue indefinitely. But it’s clear that prices have to rise just to cover costs, and will rise further as China starts to price the local and carbon costs of coal-fired electricity. Moreover, in technological terms, aluminium is definitely a 20th century commodity. Its inherent properties of lightness and strength gave it great advantages, but it is now being displaced in advanced uses by carbon fibre and in some basic uses by lightweight steels.

So, it seems to me quite plausible that aluminium demand could stabilise over the next decade or two, with the result that most demand can be met by recycling rather than energy-intensive production of primary aluminium from bauxite (via alumina).

Note: I topic-banned regular commenter Hermit from talking about aluminium smelters, as it become an idee fixe. The ban is lifted for this post.

fn1. Has any new PM ever been shown up so comprehensively in such a short time? Not in my memory, which goes back to Harold Holt, and includes some shockers.

76 thoughts on “Peak aluminium?

  1. Thanks for the invite. The Gove plant converts bauxite into alumina the stuff that is mixed elsewhere (places with cheap power) with a molten salt flux to electrolytically produce aluminium at the cathode. Each tonne of aluminium ingot consumes 15 Mwh of electricity which in turn creates about 15 tonnes of CO2 if powered by subcritical coal. The ‘red mud’ after getting alumina (as well as silica and clay) is said to re-absorb some CO2. That CO2 comes from fuel oil used in heating the mix at Gove or making the caustic soda input someplace else. The alumina is then shipped to the smelter.

    I’m not sure of the economics of transporting raw bauxite to China as that is unnecessary tonnage (50%?) and ship fuel. Australia is down from 6 electrolytic smelters to 5 with the closure of Kurri Kurri NSW which helped our emissions somewhat. The Brits seem to think they can get their aluminium recycling rate up to 80% but I think ours is a lot less. Adelaide’s can deposit scheme is yet to go Australia wide. As many point out (eg Stiglitz) we really should slap a carbon tariff on metals like aluminium bought from China. Assuming coal power that would be 15 X $24.15 = $362 per tonne in round figures on top of $1,750 FOB, a historically low price. Call it 20%. The carbon tariff would be in lieu of carbon tax exemption which in 2012 for smelters was 94.5%, perhaps a tad less in 2013.

    It’s bizarre if we buy aluminium made from our bauxite or alumina as the ore and our thermal coal as the energy source. Supposedly the most efficient smelters are now in the Middle East using gas fired electricity. It was alleged that our smelters paid as little as 2-4c per kwh a virtual subsidy worth over $130,000 per employee. There’s no way a low carbon mix of new nuclear, old hydro, wind and solar could get near that price. We must simply pay more for aluminium. Drink can recycling may be a hassle but it’s something we should do.

  2. The Chinese are doing that in a number of industries, including aluminum and solar power. I hope they’re smart enough to gradually let reality and the need to break even (or even make a profit) into the picture, as opposed to letting the situation continue until it’s untenable and they do a nasty “rip the band-aid off in one blow!” type of thing (as with the coal mining industry and Thatcher).

  3. Just in case anyone thinks we need aluminium smelters for defence purposes I will point out that it’s not very bright to pay to keep aluminium smelters operating when one instead could directly pay for a stockpile of aluminium. If there is some sort of defence emergency in the future there is no point in trying to use what could be vital electricity, energy, and transportation trying to smelt aluminium when it would be much cheaper and easier to keep a supply of aluminium at hand ready to use. In practice there is of course plenty of aluminium lying around being used for non-vital purposes and this reserve may be more than sufficient as responses to any future defence emergencies are unlikely to involve building tens of thousands of Spitfires.

    My guess is that any defence benefit from stockpiling aluminium would be insignificant compared to actions that clearly boost Australia’s ability to defend itself such as increasing the superannuation contribution amount.

  4. The announcement that Rio Tinto is to close its alumina refinery [emphasis added] at Gove struck me for a number of reasons, starting with the fact that members of my family are affected by it. First up it’s worth noticing what’s mentioned (the high dollar and low aluminium price) and what isn’t (the carbon tax and legislation for its removal. Having claimed that he was going to save industries like aluminium smelting [emphasis added] from the carbon tax “wrecking ball”, Abbott is now shown up, once again, as a fraud… So, it seems to me quite plausible that aluminium demand could stabilise over the next decade or two, with the result that most demand can be met by recycling rather than energy-intensive bauxite smelting [emphasis added].

    You have confused two very different stages in the processing: alumina refining and aluminium smelting. There is no such thing as “energy-intensive bauxite smelting”. Roughly speaking, here’s what happens in the modern (electrolytic) process:-

    – The ore, bauxite, is dug up.

    – Alumina is refined from that locally since doing that is not energy-intensive, to reduce transport costs later by reducing weight and bulk. This involves dissolving the alumina in hot, high pressure caustic soda to make a sodium aluminate solution, filtering that, and then cooling it and precipitating the alumina out with a seed crystal.

    – The alumina is transported to somewhere which has cheap energy where the aluminium is extracted electrolytically, something that needs a great deal of electrical energy. This involves graphite lined, water cooled steel crucibles and graphite electrodes (which are gradually consumed), the addition of cryolite (a sodium-aluminium fluoride) in enough quantities to make up losses, and temperatures high enough that the molten aluminium is denser than the molten cryolite/aluminium blend.

    Nothing in any of this connects the carbon tax issues as significant factors in the current alumina refinery closures, though they are very relevant to potential aluminium smelting closures, so none of it has any bearing on whether Abbott is or is not a fraud.

  5. I’m not sure that aiming for a lower dollar is all that great for the rest of us, at least not without some other adjustments to partially compensate for the diverse consequences of a lower dollar.

    While there is a high foreign investment demand for houses and apartments, the lower the dollar the better for them against the domestic (would-be) buyers of real estate. Wouldn’t it be better to use interest rates to quieten the current real estate upsurge, or even better, to make some adjustments to the negative gearing of investment properties, so as to make it a less attractive proposition? I full realise that lifting interest rates would have broad-ranging consequences across the economy, some good and some bad, but we have so few levers to play with, these days. And Keating tried the negative gearing adjustment in 1985—quarantining it to rental income only—and had to revert back to having it deducted against all sources of income, thanks to a backlash. I think the current government is never going to consider even the slightest reduction to negative gearing of investment property, but I wait in hope of some rationality entering this aspect of our economy.

    At the end of the day, mining and processing of ore are almost disjoint from the rest of our domestic economy: the so-called two-speed economy is a result of this structural feature of Australia’s assets, those being ore bodies, lots of pastural and cropping land, and so forth. The days of cheap electricity are also fading, at least cheap coal-based electricity. I always feel sympathy with workers losing their livelihood, especially through no fault of their own. Unfortunately, one industry’s current woes often reflect another’s good fortune—not necessarily located in the same country or even the same hemisphere. Such is the world in which we live.

  6. @P.M.Lawrence

    Thanks for this correction, PML, expressed with all the grace I’ve come to expect from you over the years. I thought I’d been careful to distinguish alumina from aluminium, but a re-reading shows I’ve been sloppy.

    More importantly, the reports of the closure made it clear that the high cost of the existing fuel oil plant was a big deal in the closure. The plan was to switch to gas, but the poor economics of the industry made this infeasible. To repeat, the carbon tax wasn’t mentioned, even though energy costs were much more important here than in some of the closures Abbott banged on about as opposition leader.

  7. While bauxite and aluminium are less in demand iron ore and coking coal are holding up. This was a puzzle until I saw a TV doco on China’s ‘ghost cities’. It seems the plan is for rural peasants to move into high rise apartments and work in factories. Both the apartment blocks and factories are made with steel frames and the factories make stuff (e.g. cars) from steel. For now China’s demand for steel appears insatiable.

    However some of the ghost cities remain largely empty. At some point the Chinese government will stop building them and demand for our iron ore and coking coal will plummet. I infer those other kinds of mines are where Rio Tinto proposes to send workers retrenched from the Gove alumina plant. I suggest the iron ore and coking coal bubble is not a matter of if but when. If the mining industry can survive it won’t be structural metals
    (Fe, Al) and fossil fuels but space age stuff like lithium and rare earths.

  8. Some intersting points.

    The first article JQ refers to (massive growth of production in China) says in part;

    “Chinese producers had instead responded by installing their own refining capacity. This change was largely due to their engineering quick-footedness that allowed them to rapidly increase alumina refining capacity to process both domestic and offshore bauxites.”

    Note the journo’s deceiving mystification of what happened by calling it “engineering quick-footedness”. What really happened was dirigisme, pure and simple. The Chinese state decided it wanted a lot of alumina refining capacity quickly and the Chinese state saw that it was done. The rest of the world, subscribing to and operating on free-market theory (so-called), was wrong footed (perhaps).

    Whether the Chinese state picked a winner or not is still to be seen. Will it be economically and/or militarily advantageous in the long run to China? The Chinese Communist Party clearly thinks it will be. I myself don’t know. I don’t have a crystal ball. Maybe, nations and economies which pursue carbon fibre technology will be better off. There are a lot of unknowns in this.

    The second article linked to refers to “China losing billions”. Then when I read it they lost $1.8 billion. Last time I checked, the plural refers to at least 2 in number. Also, $1.8 billion is chicken feed to a superpower. Don’t get me wrong, I am criticising the journos only.

    In alluding to “peak aluminium” in this context, JQ is correct in implying that peaks can come about through substitution as well as resource exhaustion. Which will be the story for aluminium? Only time will tell.

    What are jet fighter hulls and surfaces made from? (Since someone brought it up.) one site suggests;

    *Outer Surface Components
    39% Titanium
    24% Composite
    16% Aluminum
    01% Thermo-plastic

    So, aluminum, as the yanks call it, still appears to have some, though not prime, importance.

  9. May I also indulge in the pleasure of nitpicking too. Bauxite is refined to produce alumina… oh, d**n it. I went back to get the exact words used and see that the point has already been made. Not an unimportant point in fact because I remember a Griffith Uni academic with environment in his title destroying his pro-Kyoto argument some years ago in a Fairfax letters column by clearly not understanding the chemistry and physics (not to say economics) of turning bauxite into aluminium by way of alumina.

  10. In one week the Portland aluminium smelter in Portland Victoria alone can produce more aluminium than is contained in the Royal Australian Airforce’s entire fleet of aircraft.

  11. Aluminium like titanium or hydrogen is not rare but takes a lot of energy to reduce to its elemental state. Bauxite is a type of laterite tropical soil at Gove NT and Weipa Qld and surprisingly at Worsley WA. Groote Eylandt manganese is also a type of laterite. The Russians make alumina from a kind of soft granite. The Lucky Country had the fortune to have both plenty of bauxite and formerly cheap energy sources, gas or oil to do the alumina process and coal fired electricity or hydro to do the electrosmelting. Some coal stations like Anglesea Vic and some Tas hydro appears to have been created by state governments mainly to help the aluminium industry. Now we still have most of the bauxite but not the cheap energy.

    China doesn’t have so much bauxite but they are willing to cut corners to get cheap energy. Example children getting lung cancer from coal smoke. Meanwhile we in the West anxious to be seen to be green get China to do the dirty work for us. So not only are 1,000+ Aussie workers losing their jobs at Gove I suspect there is a good chance that the same bauxite will be made into alumina then aluminium in China. As well as CO2 at various stages there are also perfluorocarbons (a potent GHG) emitted by smelters. If the polluter had to pay things would be different.

  12. “But it’s clear that prices have to rise just to cover costs, and will rise further as China starts to price the local and carbon costs of coal-fired electricity”

    Why? If Chinese policy makers choose they can subsidise aluminium indefinitely. If they are really following an aggressive industrialisation program, they actually only have to subsidise till their main foreign competitors close down.

  13. Of course it isn’t “peak aluminium”, in the strict sense, but it certainly follows the pattern of any localised “peak” of any resource extraction.

    If you’re on the Sunshine Coast sometime, go and check out Mill Point (in that case it was Cedar bound for the British, in the 1890s, but the same principle always applies).

    [Due to the ongoing censorship of any mention of even the name of my site – to which I tried a link, and then a mention, and lastly a cryptic mention – I’ll do a cut’n’paste]

    On the shores of windswept Lake Cootharaba, about a two kilometre walk from the camping ground at Elanda Point, you’ll find the rare remains of a small settlement. An old chimney, tank stand, mango and guava trees and boiler are some of the more obvious remnants from the nineteenth century company town Mill Point.

    According to Noosa Council/Queensland Government information boards at the site, after prospering during the Gympie gold rush, ‘McGhie, Luya and Company’ invested £2000 in establishing a sawmill at Mill Point, which by the 1880s employed up to 150 men. The sawmill covered around 25 hectares and included workshops for blacksmiths and carpenters, stables, hotel, post office, a school and houses for around 60 families.

    At its peak, the sawmill produced 3 ½ million super feet of timber in one year. Timber getters collected kauri pine and red cedar in Cooloola and Kin Kin scrubs, which was initially transported to the sawmill by bullock teams and later, a tramway. The sawn timber was floated on a paddle steamer downriver to Colloy – on the north bank of the Noosa River at Tewantin. It was then taken by steamer to Brisbane. About another two kilometres north along the easy walking track is Kin Kin Creek, the contrast between the unfelled north side and the cleared land to the south is a striking example of ‘before and after’.

    The saw mill closed in 1892 and the property was transferred a number of times. The early 1890s were a time of economic depression and severe flooding occurred in the area in 1893. Dairy farmers worked the land from 1910 until 1975 when Elanda Point was gazetted as a national park. The Queensland Government took ownership in 1983.

    Last month [November, 2006] Ms Murphy presented a lecture at the Queensland Museum and discussed the historical treasures unearthed by her team of archaeologists at Mill Point. So far the team has uncovered items such as basic cutlery and dinnerware (with a 19th century cable pattern) and beer, whiskey and schnapps bottles.

    Interestingly the only brand of Worcestershire sauce bottle they found was ‘Lea And Perrins’. Ms Murphy said that this could be explained by the fact that the company dictated what was delivered to the settlement. ‘Holbrook’s’ Worcestershire sauce bottles were often found in gold mining settlements. The community clearly dined on fresh shellfish and beef, as evidenced by the pieces of bone and numerous oyster and, pipi shells which have been uncovered. There are plans to also research the traces of the original indigenous uses of the area.

    Jars of ‘Holy’s’ ointment – a multi-function product which claimed to cure sore breasts among other ailments – were found, along with bottles which would have contained patent medicines and tonics with high concentrations of narcotics. Members of the community obviously took pride in their appearance, as two brands of hair loss tonic, perfume bottles, a comb, a metal heel from a shoe, buttons and an earring were also found.

    Ceramic dolls’ faces originating from Germany and miniature tea sets give an insight into how the children played, and the discovery of slates and slate pencils testify to the school that existed at the settlement. Household items including ink bottles, a padlock, porcelain lamp stand and the top of a ceramic baby’s feeding bottle were also found. Many clay pipes have been retrieved – this was the common way to smoke tobacco before cigarettes were invented just prior to World War One.

    The archaeaology of this fascinating site and the personal items uncovered, give an insight into the every day life of the workers and their families and provide an intimate link to the people who lived at Mill Point in the late 19th century. The history of the place, which was founded during a boom and abandoned just as swiftly after only twenty years, illustrates its relevance today for towns which are driven by a solely commercial imperative!

  14. I assume nobody cares, but my site is:

    “spring” followed immediately and without any spacing by “hill” and then, in the same manner “voice”

  15. Notice John Q’s cutting-edge “macro pru” moderation of Hermit! (Example: Mark Carney of the Bank of England has just withdrawn a cheap credit line for UKmortgages, aiming to shift bank loans to SMEs).

  16. It’s a metal that is very suited to recycling and unlike most recycled materials it is actual recycling rather than downcycling – ie it can be repeatedly re-used as equivalent to the new material quality rather than at lower quality. Most ‘recycling’ is downcycling with, at best, a couple of reuses at lesser quality before disposal. It is a valuable industrial ‘nutrient’ – in McDonough and Branagh’s “Cradle to Cradle” style (well worth taking a look and read) where materials are preferentially used that are capable of 100% reuse at as-new quality.

    The energy and presumably carbon costs of recycled Al is relatively low compared to new so a greater national and global pool of refined aluminium for reuse seems to make long term sustainability type sense.

    Ultimately, could the refining process be modified to make use of abundant and cheap daytime solar – ie most of the energy intensive work done during the day shift rather than as a 24/7 continuous operation? I doubt these businesses would seek such a model but, if cheap, abundant daytime power becomes the norm, might they seek to take advantage of it?

  17. @Cameron Murray

    “If Chinese policy makers choose they can subsidise aluminium indefinitely. If they are really following an aggressive industrialisation program, they actually only have to subsidise till their main foreign competitors close down.”

    Exactly, but always with a caveat to the effect that resource limits might ultimately curb aluminium production. I made substantially the same point higher up when I invoked the concept of dirigisme. People are so indoctrinated with market views now they think that financial sustainability is a real constraint. Financial sustainability is not a real constraint, it is an artificial or notional constraint. Only real material and real energy constraints are real (to be both obviously tautological and pedantically correct). The other real constraint is real political legitimisation and/or constraint. This latter ultimately is material too because it is what humans do with their bodies. Do they comply (go to work, obey etc.) or do they rebel (demonstrate, obstruct, rebel, revolt)?

  18. @Ken Fabian
    My understanding is that molten salt electrolysis can be slowed down but not stopped as the content of the pots will solidify. That is a major drama to recover from apparently. Electricity supply contracts have penalty clauses for interruptions. I remember discussing this with some hydro dam workers who offered me (a tourist) a lift in a cable car. OTOH some aqueous electrorefining processes (eg for copper) probably can cope with a blackout.

    Therefore we have some sticky energy supply problems
    – aluminium smelting needs baseload power 24/7
    – steel making needs coking coal
    – aircraft need liquid hydrocarbon fuels.
    Sure there have been experimental alternatives none practical AFAIK.

  19. @Hermit

    aluminium smelting needs baseload {fully despatchable} power

    Let’s at least get our terms correct. Baseload describes demand patterns not supply features.

  20. @Hermit

    The sticky energy problems do exist but they have solutions. Whether these solutions are complete or only partial will only be told in time.

    1. Renewables can supply energy 24/7 in robust quantities albeit at a lower EROEI which might or might not be a problem long term. Each time I outline how this is possible the information falls into a vacuum. Critics of renewable energy carry right on as if none of the answers exist. Solar convection towers and solar thermal concentrating with salt tank heat energy storage can both meet the requirements of providing power 24/7. A widely distributed network of renewable sources of different types over a continent will also smooth supply to some considerable degree.

    2. If we stopped burning thermal coal and eventually oil and gas, the burning of coking coal would not be a significant issue.

    3. Liquid hydrocarbon fuels can be synthesised from CH4 which in turn can be synthesised from solar energy in various ways. Meeting the requirements for aircraft might be possible. Meeting the requirements for surface transport would not be possible and that all requires different solutions.

  21. @Hermit

    Smaller batches? Idle at minimum power overnight? Different methods? In the presence of 24/7 subsidised supply there’s not much incentive to do it differently. Can’t and prefer not to are different things.

    This is an industry that probably likes the idea of nuclear wherever it is running on fossil fuels, but not as much as it dislikes the prospects of carbon pricing or emissions restrictions. Advocating against the latter has more immediate commercial benefits – as well as slotting in neatly with the existing, broader, mainstream church of climate action obstructionism and anti-renewables advocacy – whereas nuclear advocacy doesn’t fit with any current mainstream political agenda in Australia and yields no immediate benefits. As long as that is the case they will shut up about nuclear and find no cause for alarm in government by climate science deniers.

  22. I think all forms of new nuclear are too expensive for aluminium smelting, hence I agree with Pr Q we must aim for near 100% recycling. The Russians with their non-bauxite alumina source are probably using a lot of coal power since I note the World Bank just knocked them back for some new coal funding.

    I’m not anti renewables since I dabble in PV, wood cooking, biodiesel and microhydro it’s just I don’t think they can displace enough coal. Germany with $30 bn a year in green levies yet increasing emissions seems to show us strongly diminishing returns after about 25% renewables penetration. Their metals industries are suffering high anxiety
    http://www.spiegel.de/international/business/merkel-s-switch-to-renewables-rising-energy-prices-endanger-german-industry-a-816669.html

  23. Well, the bottom line is that eventually (in 30 years or 50 years or a 100?) everything will HAVE to run on renewable energy and renewable resources. Because that is all there will be. So, whatever that supports will be the limit. And if we have overshot sustainable capacity there will be a population decline, total infrastructure decline and complexity decline of some degree. These are ineluctable facts.

  24. I like Hermit’s suggestion to slap a border tax on aluminium imports from China (but not on imports from other countries – if any – which rely on hydropower). I also favour exempting those exports from Australia from any tax or allocating free carbon quotas to producers in proportion to their exports. All academic of course given that we have a silly direct action plan that looks like it will soon take over.

  25. @hc

    It would have been very simple and logical to have a direct Pigovian tax on CO2 emissions (say $50 a tonne) and to levy an equivalent import duty on goods made OS which had produced CO2 emissions in manufacture which were not taxed or priced or were taxed or priced inadequately in that country.

    Of course, simple, logical and equitable is not appealing to the neocon shysters who want the playing field tilted extremely in their favour. It is par for the course that complications, obfuscations and delays emanate from the rent seekers.

  26. When looking at the AUD and interest rates, how does it work? Lower interest rates might make the AUD fall, but then they may also re-start the housing bubble?

    Is there any harm in stimulating the economy by simply giving money to the poorest, knowing that they will spend every cent?

  27. Ikonoclast, you wrote, “Renewables can supply energy 24/7 in robust quantities albeit at a lower EROEI which might or might not be a problem long term.” How did you determine the EROEIs? For producing electricity, Australian coal is under 1:3 while new wind capacity is over 50:1. In other words, more that 3 joules of energy have to be expended through human activity to produce a joule of electricity from coal, while less than 0.02 of a joule has to be expended to get a joule of electricity from wind power.

  28. @Ronald Brak

    Just on a side point: Are you seriously suggesting that Australian coal has a negative energy return on energy invested?

    It takes twice as much energy to get it to the energy production point as the energy then produced?

    (I know we’ve disagreed in the past – but are there readily accessible figures for this?)

  29. Megan, unfortunately it is impossible to get more than a joule of electrical energy out of a joule of heat energy which is the sort of energy you get from burning coal. We can’t even trade thermal joules for electrical joules one for one. Technically coal plants could be about 60% efficient but in practice in Australia we only manage about half that. So a coal plant that is 33% efficient is only going to turn one third of the thermal energy in coal into electricity before any other considerations are taken into account giving it an EROEI of under 1:3. Efficiency needs to be taken into account otherwise we end up with the strange situation where an inefficient coal plant that use 50% more coal and emits 50% more carbon dioxide per joule of electricity generated ends up with the same EROEI as a much more efficent coal plant. This would obviously be a very weird thing to conclude, but it doesn’t seek to stop people from doing it. As you can probably tell, EROEI is not a terribly practical concept.

  30. A couple of nuances here.

    Firstly, bauxite is extremely common all over the tropics. Unlike other minerals there is no scarcity value at all – so low operating costs, including both transport costs to a smelter and no requirement for envoironmental remediation, is everything for alumina refining viability. We are a long way from Chinese smelters and (rightly) much less tolerant of lakes of toxic red mud – the wonder is that Gove has been viable at all for the export market, not that the Chinese have built alumina refineries closer to their subsidised smelters.

    The second thing to note is that new titanium (and vanadium and tantalum) smelters are planned, using a much cheaper electrolytic process (rather than purely chemical reduction) recently developed in that traditional home of smelting technology Sheffield, England. The futures market have priced in big falls in the cost of Ti ingots over the next few years, with no doubt more to come. In the long run this may make aerospace and similar hi-tech use of Al (and perhaps composites too) much less.

  31. derrida derider :
    A couple of nuances here.

    The second thing to note is that new titanium (and vanadium and tantalum) smelters are planned, using a much cheaper electrolytic process (rather than purely chemical reduction) recently developed in that traditional home of smelting technology Sheffield, England. The futures market have priced in big falls in the cost of Ti ingots over the next few years, with no doubt more to come. In the long run this may make aerospace and similar hi-tech use of Al (and perhaps composites too) much less.

    Can you tell us more about the electrolytic process for titanium? There are a couple of things about its possibilities that concern me:-

    – It has been unsuccessfully sought for decades, so anything that shows prospects almost certainly has hidden catches. I’d like to know what those are.

    – The current process is an analogue of the original, chemical process for making aluminium. But that was expensive because it had a prior stage to make sodium chemically, which blew out the cost. The titanium analogue uses magnesium for that (or sometimes sodium), but those can now be made cheaply; much of the rest of the cost comes from the need (not present with aluminium) to do an analogue of primitive ironworking after that, i.e. repeated hammering and folding to squeeze out inclusions of waste, only this time in an inert argon atmosphere as well as at high temperature. Would the new process also need that last, expensive stage, even if not as much of it?

  32. @Ronald Brak

    I’d say you’re mixing up categories on EROEI. It doesn’t take much energy to harvest coal in realtion to the amount of carbon extracted. Last time I looked, it was something like 1:35 internationally.

    Plainly, the exact relationship in each case will vary depending on the quality of the coal seam, where it is and hiow easy it is to get at and of course, how far it has to be trnasported from processing (and how much processing is required).

    Once you combust it, as you say, conventional coal plants using black coal are only about 35% efficient at converting the carbon into useable energy. Ultra-critical coal plants may approach 50% but plainly, there’s still a lot of waste heat.

    Using EROEI isn’t all that useful with fossil HC because as people point out, fossil hydrocarbons are “packaged sunlight over geological time” so the process of desequesttration is simply like the energy equivalent of presenting the drawing down of inventories as “work product”.

    Its only salience comes when the actual harvest + pre-process demands more energy than can be despatched at the other end. AIUI we’re a long way from that, and if we weren’t, precisely the cost of the fossil HCs we mostly use to harvest coal would price it out of the market.

    Imagine if to fill your tank with petrol, you had to use half a tank to get to the filling station? You’d arrive home no better off, so filling up would not be feasible unless someone delivered it to you. If you used more than that, you’d be better off permanently abandoning your car and walking.

  33. Fran, I’m not mixed up on categories, but I think that EROEI is often used in a mixed up way. Mining coal and using it for heating gives a very high Energy Return On Energy Invested but in Australia very little coal is actually used for heating. Most domestic coal use is involved in electricity production and the low efficiency with which this is done needs to be taken into account otherwise we can end up with the bizarre situation where using using three tonnes of coal to power space heaters in a building over winter can have the same EROEI as burning one tonne of coal to directly heat the building.

  34. @Ronald Brak

    this source (not a fossil-fuel-friendly one) puts coal eroei on coal as 18. I assume that’s after an adjustment down of 2/3 to allow for losses in conversion to despatchable power as they mentioned that in the article.

    It’s said to be comparable to wind (20) if you take the measurement at the minemouth … Of course, if the aim is to get electricity, you can’t.

    {the usual} + carbonbrief.org/blog/2013/03/energy-return-on-investment-which-fuels-win/

  35. @Ronald Brak

    You’re not suggesting that it is possible to get 50 joules of electrical energy from 1 joule of ‘wind’ (kinetic, I think) energy?

    Otherwise you’re comparing apples and unicorns. Not very helpful to use EROEI for one but not the other.

  36. Coal in Australia should have an EROEI considerably better than 18:1 by the time it reaches a power plant, but once there the sad fact is the inefficency of producing electricity from coal makes its EROEI average less than 1:3. An unavoidable result of the fact that in Australia we use more than 3 joules of thermal energy from coal to produce one joule of electricity. Of course one could ignore this efficiency issue, but then one would be unable to avoid the conclusion that Hazelwood power plant, one of the most inefficient brown coal plants in the world, has about the same EROEI as the modern black coal Kogan Creek power plant.

  37. Megan, unfortunately the laws of phyics so far do not allow 50 joules of electricity to be obtained from one joule of kinetic energy from wind. Off the top of my head I believe about one percent of the energy of the sun goes into moving wind around, so that would make the EROEI of new wind in Australia around 1:2 or better. And the efficiency of carboniferious swamps at converting solar energy into peat might be quite high given the inability of decomposers to breakdown lignin back then, which might make the EROEI of coal for producing electricty 1:10,000 or possibly even better. But I’d be more inclined to say 1:100,000 for now. It would be possible to made a decent estimate for some coal deposits, but it’s not something I’m capable of doing just at the moment.

    But generally, or rather, pretty much always, the solar energy required to push air around or make plants grow hundreds of millions of years ago isn’t included in EROEI calculatons. It’s taken as given.

  38. @Ronald Brak

    That’s why I was puzzled that you wrote:

    How did you determine the EROEIs? For producing electricity, Australian coal is under 1:3 while new wind capacity is over 50:1. In other words, more that 3 joules of energy have to be expended through human activity to produce a joule of electricity from coal, while less than 0.02 of a joule has to be expended to get a joule of electricity from wind power.

    But now your 1:3 for coal only starts once the coal is in the furnace. In that case it’s more correct to say that zero “joules have to be expended through human activity to produce a joule of electricity from coal”, since the coal – once in the furnace – burns all by itself, no human joules required to make it burn.

    I don’t care for a pointless fight at the moment. In fact, I never do.

    Thanks for answering my query.

  39. Megan, energy has to be invested to get that coal into the furnace and energy has to be invested to make that furnace. That’s the initial investment and the heat given off by the coal is the return on that investment. Unfortunately when it comes to making electricity from heat we don’t get a very good return on the investment. But I wouldn’t worry too much about EROEI. I really don’t see how it is helpful compared to things we really want to know, such as what is the cost and how much CO2 and/or other pollution does it cause?

  40. @Ronald Brak

    Yes, I’m well aware of that. It appeared that you weren’t, and I wanted to check whether you knew something I didn’t or were just misstating that fact.

    Wind power is great. The power behind coal has nothing to do with EROEI and everything to do with the failure of our democracy, media and economics.

  41. @Ronald Brak

    In my experience Ronald, your posts here are consistently worth reading, but I am genuinely perplexed at your contributions above in this topic.

    EROEIs are an interesting metric but their principal application is to the evaluation of the feasibility of harvest of fossil hydrocarbons (FHCs). That’s because in an energy system dominated by resort to the combustion of FHCs, almost all energy inputs are from the same finite and polluting pool.

    It also matters which fossil hydrocarbons are used, because if the FHCs are harder to get in EROEI terms or more valuable for some other reason (e.g. despatchability) than those being harvested, the world is worse off. Using oil to get coal fits this description.

    EROEI is obviously far less salient if significant parts of the energy input are renewable or “use it or lose it” (such as wind, wave, solar etc …) As long as FHCs are a significant input, EROEI has salience. That’s one good reason for considering, when building any energy infrastructure (such as solar arrays or windfarms or hydroelectric dams or coal/nuclear plants) the lifecycle carbon footprint of the infrastructure and setting that off against emissions foreclosed by the infrastructure to find a payback figure from the “embedded” emissions. We also do this with cars, so as to see the point at which low emissions vehicles become superior to higher emissions vehicles notwithstanding embedded emissions costs.

    If coal were an abundant, low in energy cost-terms to harvest and completely renewable and carbon free source, then EROEI would be almost entirely irrelevant, even if the coal plant was only converting one third of its notional heat value to something useable. In practice, all energy technologies suffer losses converting one form of energy into another, so in that narrow sense, all technologies have EROEIs that are less than 1:1. What you may be saying is that when one mines coal and allows for the FHC energy costs of harvesting it the return is roughly 18:1 and thereafter when one converts it to electricity in a thermal power plant roughly 2/3 of the heat value (3/4 if lignite) is lost as waste heat putting the activity in EROEI terms at less than 6:1 as it leaves the plant. More is lost in transmission and of course plants have to operate continuously and can’t be greatly ramped down for long without risking outages so there are more losses there so by the time an end user gets it, the EROEI is dreadful.

    By way of comparison, I understand that the energy losses on food are pretty heavy. Apparently it takes on average 10 calories of energy to deliver 1 calorie of energy into a human mouth, and more in the case of man foods consumed by first worlders. Most of that is supplied by FHCs too.

    One can argue that the EROEIs on FHCs are too low to make them sustainable over time, and I’d agree. Yet they’re not yet lower than 1:1 or they simply wouldn’t be used.

  42. PM, the FFC process produces hi-purity metallic powder rather than sponge – no need to hammer the bloom in pre-industrial revolution style. Try googling “Metalysis”, or look at this report.

  43. @derrida derider
    Ah – then there is still usually a “need to hammer the bloom in pre-industrial revolution style” (apart from using rolling mills or whatever to do it) to get solid billets conveniently, just not as much need as it wouldn’t need to be done repeatedly interspersed with folding to squeeze out inclusions. The only exceptions would be if sintering gave results fit for purpose (which still needs energy, and might use some hammering, rolling or a high pressure inert atmosphere anyway), or if for some reason it made sense to use even more energy to melt the titanium in expensive refractory crucibles for casting.

  44. Fran, apart from maybe a few high tech pilot plants, when it comes to producing electrical energy all coal power plants have EROEIs of less than 1. This is because they all use at least two joules of thermal energy to generate one joule of electricity. Ignoring all other energy inputs this means their EROEIs can be no better than 1:2. All coal ever burned in Australia to produce electricity has had an EROEI of less than 1:2. So why do we burn coal to generate electricity when its EROEI is less than 1? It’s because people could make money that way. When there’s money to be made an EROEI of less than 1 won’t stop people from doing something.

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