Carbon Peak Plan for the Nonferrous Metals Industry Unveiled; Green Recycled Aluminum Sees Development Opportunities

Recently, the Ministry of Industry and Information Technology, the National Development and Reform Commission, and the Ministry of Ecology and Environment jointly issued the “Implementation Plan for Peaking Carbon Emissions in the Nonferrous Metals Industry” (hereinafter referred to as the “Plan”). The Plan sets out, on a preliminary basis, the target of achieving significant optimization of the industrial structure and energy consumption structure in the nonferrous metals sector by 2025, with the share of recycled metal supply reaching at least 24%.
　　Several experts told People’s Daily Online Finance that the release of the “Plan” signifies that the nonferrous metals industry, as one of the raw-material sectors striving to achieve carbon peaking ahead of others, will accelerate comprehensive, end-to-end control of carbon emissions across the board—covering total emissions, production processes, and upstream sources—thereby contributing to China’s overall achievement of carbon peaking. At the same time, the “Plan” will usher in new opportunities for the development of China’s green recycled aluminum industry.
　　Strengthening the reduction-and-replacement of electrolytic aluminum capacity: capping overall production capacity.
　　Carbon emissions from nonferrous metals are concentrated in aluminum, copper, lead, zinc, magnesium, and industrial silicon. Aluminum production has long been characterized by high emissions and high energy consumption. According to relevant data, as a major producer and consumer of aluminum, China’s aluminum industry accounts for more than 75% of the total carbon emissions in the entire nonferrous metals sector and approximately 6% of the country’s total CO2 emissions.
　　The Plan calls for continued adherence to overall caps on electrolytic aluminum capacity, the development of differentiated policies for reducing and replacing existing electrolytic aluminum capacity, the rigorous assignment of responsibilities to local governments, and the inclusion of stringent controls on new electrolytic aluminum capacity as a key component of central ecological and environmental protection inspections.
　　Ge Honglin, President of the China Nonferrous Metals Industry Association, stated in an interview that electrolytic aluminum output is the key determinant of carbon emissions in the nonferrous metals industry. He emphasized the need to strictly control electrolytic aluminum capacity, categorically prohibiting any new capacity expansion in any form, while also imposing strict caps on total smelting capacity for copper and other commodities, and exploring the establishment of an early-warning mechanism for peaking consumption of nonferrous metals.
　　Currently, China’s installed electrolytic aluminum capacity stands at 44.5 million tonnes per year, nearly reaching the domestic cap of 45 million tonnes per year. Industry experts note that the release of the “Plan” signals a further tightening of the cap on domestic electrolytic aluminum capacity. On the one hand, the previous practice of equivalent replacement for new electrolytic aluminum capacity is expected to gradually shift toward reduction-based replacement, thereby exerting additional downward pressure on overall capacity. On the other hand, incorporating the control of electrolytic aluminum capacity into ecological and environmental oversight will help further curb capacity expansion in this sector.
　　Proactively develop a clean energy substitution system and accelerate the phase-out of inefficient production capacity.
　　The Second Biennial Update Report on Climate Change of the People’s Republic of China indicates that energy-related activities are the primary source of greenhouse gas emissions in China, accounting for approximately 86.8% of the country’s total carbon dioxide emissions. Among these, fossil fuels constitute the dominant component of energy-related activities.
　　Fossil fuels are precisely the primary source of both fuel and electricity used in China’s nonferrous metals industry. Relevant data show that, taking electrolytic aluminum—the sector with the highest electricity consumption—as an example, more than 60% of its production capacity relies on coal-fired captive power generation. As a result, the carbon intensity of its products is significantly higher than that of comparable foreign products powered by clean energy. Indirect emissions from electricity use account for 85% of the total carbon footprint of electrolytic aluminum and over 50% of the sector’s overall emissions.
　　Is it possible to address carbon emissions by reducing or eliminating the use of fossil fuels? The focus has shifted to clean energy. Experts point out that renewable energy sources such as solar, wind, hydro, and geothermal power produce no carbon dioxide during operation, making them far more environmentally friendly. In recent years, China has been actively developing and expanding its renewable energy sector.
　　The approach of transitioning energy types is equally applicable in the nonferrous metals industry. The Plan proposes promoting the substitution of coal with natural gas and electricity in this sector, curbing fossil fuel consumption, encouraging enterprises such as electrolytic aluminum producers to relocate in an orderly manner to regions rich in renewable energy, and facilitating the shift from coal-fired captive power generation to grid-supplied electricity, thereby reducing carbon emissions per unit of output at the source.
　　The Plan proposes that by 2025, the proportion of direct alloying of molten aluminum will be increased to over 90%, that tiered electricity pricing and other green tariff policies will be refined to guide energy conservation and emission reduction in key industries such as primary aluminum smelting, and that the phase-out of inefficient production capacity will be accelerated. At the same time, the construction of coal-fired captive power plants will be strictly prohibited, and the shift from captive power to grid-supplied electricity in the primary aluminum industry will be promoted, with the goal of achieving renewable energy shares of at least 25% in 2025 and at least 30% in 2030.
　　Industry experts say the Plan calls for comprehensive energy-saving and emission-reduction efforts across the entire electrolytic aluminum value chain, covering both production processes and energy sources. This is expected to further curb supply from coal-fired power–based aluminum production, while promoting the use of green energy in aluminum smelting—benefiting electrolytic aluminum companies that are currently positioned in hydropower-rich regions and actively increasing their share of green electricity.
　　Developing the Recycled Aluminum Industry: Unlocking the Future Potential of “Urban Mines”
　　To build a green manufacturing system, in addition to aggressively reducing carbon emissions throughout the production process, what other areas require sustained effort? The Plan proposes to improve the recycling and comprehensive utilization system, establish resource-integrated utilization hubs, develop regional recycling pre-processing and distribution centers, and enhance the level of high-value, grade-preserving utilization.
　　Jia Mingxing, Vice President of the China Nonferrous Metals Industry Association, believes that a well-developed recycling system will guide nonferrous metals producers in adopting green raw and auxiliary materials, technologies, equipment, and logistics; facilitate the recovery of “urban mines” such as waste household appliances and electronic waste rich in nonferrous metals; establish a green, low-carbon supply-chain management system; and promote the green transformation and upgrading of the industry chain.
　　The Plan sets forth that by 2025, recycled aluminum production will reach 11.5 million tonnes, and it will explore the inclusion of key nonferrous metal varieties in the national carbon emissions trading market. Industry experts believe that recycled aluminum offers significant emission-reduction benefits, with carbon emissions per unit only 2% of those from primary aluminum; the substitution of primary aluminum with recycled aluminum will effectively reduce carbon emissions at the source.
　　Experts say that China’s electrolytic aluminum supply side is poised for a transformation, with the domestic green recycled aluminum sector accelerating its development and future incremental electrolytic aluminum capacity likely to be shifted overseas. (Nonferrous Metals Treasure)