How Alcoa Turns Sustainability into Profitability
When it comes to sustainable businesses, mining is not likely the first industry to come mind. But many mining companies, including Alcoa, are early adopters of sustainable practices. Alcoa is one of the world’s largest producers of aluminum, as well as the world’s largest miner of bauxite and refiner of alumina. In sharp contrast to the image of mining as a destructive industry, aluminum is among the most commonly recycled material in the world, and is one of the easiest to recycle.
It’s this image that rings truer to the heart and intentions of Alcoa as it seeks to ensure sustainability in all aspects of its business. IMT Green and Clean Journal recently spoke with Kevin Anton, Alcoa’s chief sustainability officer, about the company’s environmental efforts, and how they’ve managed to balance responsibility with financial benefits.
Seeing the Long Term
Anton agreed with the assessment that mining gets a “bum rap” when it comes to sustainability. But he insisted that the mining industry began to understand the concept of sustainability long before the term was part of business vernacular. That’s because, as Anton noted, “Sustainability is very much about long-term.” He added, “If you are a metals mining company and are doing 20-, 50-, or 100-year investments, you have to look through cycles and see the long-haul.”
Anton said sustainability is about community. When Alcoa sought to establish its first mine in Brazil in the 1950s, there were no regulations for the industry, so the company worked with locals and lawmakers to write laws and regulations.
Moreover, Alcoa trained locals in necessary skills to help ensure the ecosystem could be restored once the mine was exhausted. Anton said they taught Brazilian workers what kind of trees would need to be planted, helped find the seeds, and even built greenhouses to hold them until the trees can be replanted.
For the company’s surface mining operations, Anton said, the goal is to be as minimally disruptive as possible. “We go in, harvest trees, secure the topsoil, remove the overburden, then take out the ore. So what we are mining today we will have re-covered next year and will already by planting,” he explained. “We also do a lot of science on getting the right species back in.”
While experience helps, Alcoa also leverages technology to help reduce impact. “What we are doing differently is putting GPS systems on the blades of the scrapers. This makes sure that, if there is six inches of topsoil, we are getting all six inches and not mining more than we need to.”
Anton also cited an example in Australia, where Alcoa recently established a new mine face. Again, Alcoa officials worked with the surrounding communities to reduce both environmental and societal disruption. There were two core issues that had to be addressed: building roads to reach the site, and conservation of water, as the region has been suffering from a drought. “We designed the roads to meet community needs for safety and noise. But we also worked on saving the runoff. Instead of going into the Indian Ocean, we built reservoirs, and made sure we are not using any of the community water,” Anton said.
The company was also willing to lend scarce resources during an emergency. “When there was a brush fire nearby, [locals] came and knocked on our door and said, ‘We need your water.’ So they brought helicopters and used water from our reservoir to put out the flames.”
Becoming Better Manufacturers
For Alcoa, the benefits of sustainability have been more than “feel good” moments. According to Anton, it has made the company a more efficient and effective manufacturer.
In the 1990s, under then-CEO Paul O’Neill, Alcoa partnered with the EPA and set voluntary targets to reduce chlorofluorocarbons (CFCs) and other process greenhouse gasses. “What we discovered was, where we were emitting GHGs, we could become more energy efficient, and this drove our productivity higher,” said Anton.
For example, the most energy-intensive part of the aluminum smelting process is the electrolysis. “In aluminum electrolysis, you have a carbon anode,” Anton explained. “Electricity flows through the carbon anode, through a bath material, which is aluminum oxide, cryolite, and aluminum fluoride. The metal becomes the cathode and the electricity goes to the next cell.”
He continued, “In our process, when the aluminum becomes too lean in the bath, you effectively have a short circuit between the anode and cathode. When that happened, the fluoride combines with the carbon and becomes CFCs. But the thought process was that it was good for the manufacturing process to have a certain number of anode effects per day because it kept the bottom from becoming mucked up with aluminum oxide.”
To eliminate the CFCs, Anton said, the process was modified to continuously feed aluminum oxide and avoid the anode effect. “As a result, it lowered electricity consumption per ton of aluminum produced, lowered emissions, and gave us more production from each cell each day — a pure win.”
Anton insisted that, “If not for the emphasis on the environment, it might have been years before we figured that out.”
Alcoa continues to apply technologies to become more energy efficient and more productive. The company employs smart manufacturing tools and Big Data to boost the output of refineries by 1 to 2 percent per year. “We put sensors on the system and write algorithms that help us adjust on the fly,” he said. “This gives us real-time data from the cell.”
That’s a huge contrast to a decade ago. “Ten years ago, we would have taken a sample from the cell, let it cool, taken it to a lab, analyzed it, and maybe the cell was in the same condition as when the sample was taken yesterday,” said Anton.
Overall, the company boasted approximately $75 million in efficiency savings related sustainability efforts. “Whether you believe in greenhouse gasses are an issue or not, saving money is always an issue,” said Anton. “When you have that much savings, you have a process change. Maybe you have a little slippage here and there, but generally you get that locked in.”