South32 pushes for low-carbon energy solution at Hillside aluminium smelter

Tawanda Karombo 

South32 is pursuing a decarbonisation programme for Hillside, its South African aluminium smelter operation in South Africa as part of its broader carbon reduction emission efforts and to be in line with European export demands for the material.

The company said it had temporarily shut down the Wessels manganese mine it runs in the Northern Cape before re-opening it.

In March, Hillside was the subject of a claim by an Australian company that charged that the South32 subsidiary had improperly used intellectual property related to metal transportation at the South African operation.

Now, South32 has on Wednesday said that it is “engaging with stakeholders to secure a comprehensive low-carbon energy solution for Hillside Aluminium and on issues related to a just energy transition” in South Africa.

As part of this, the company was working on implementing AP3XLE technology which delivers energy efficiency. South32 had relined 57% of the Hillside smelter’s pots using the AP3XLE technology.

Kelly O'Rourke, chief legal, external affairs and sustainability officer for South32 said on Wednesday that the Hillside operation accounts for nearly 60% of the company’s operational emissions.

“We've invested in AP3XLE energy efficiency technology with over 50% of pots having been relined, delivering improvements in emissions intensity. However, our focus is on Scope 2 … almost 90% of Hillside's operational emissions come from the use of coal-fired power supplied by Eskom,” O'Rourke.

To meet the company’s emissions targets and to “protect Hillside's future market competitiveness,” South32 is looking for “a long-term affordable low-carbon energy” solution.

This was, however, proving to be a “complex challenge because of Hillside's large continuous electricity baseload demand, the high cost associated with firming and the substantial upgrades that are required for South Africa's electricity network to support large volumes of renewable connections” to the grid. 

South32 CEO, Graham Kerr, emphasised that Hillside was an important asset for both the company and for South Africa. He said the smelter operation employed about 2,500 direct jobs, contributing an additional 30 000 indirect jobs.

South32 sells about 30% of its produce downstream for further manufacturing of parts, predominantly going to the auto industry in South Africa.

“That's a very big part of KZN the province in an area that is largely impoverished and high levels of unemployment. So we're very conscious as we think about that operation and how we run it,” said Kerr.

South32 has a power contract for Hillside running up to 2031. In Mozambique, said O'Rourke, South32 had also turned to Eskom to power up its Mozal Aluminium operation.

Normally Mozal Aluminum is powered by hydro-electricity from the Cahora Bassa Dam. However, this year, drought conditions in the Mozambique Basin have impacted hydro availability, necessitating “additional backup power from Eskom,” further increasing the company’s operational emissions.

It is, however, in South Africa where the company is focusing significantly on decarbonisation. It requires a solution for Hillside “that preserves value and maintains access to key markets like Europe, particularly given carbon prices are currently expected on aluminum imports into the EU” from next year.

“Clearly Hillside's future is a shared challenge that requires a multi-stakeholder solution, and we continue to work with the South African government and Eskom. There is goodwill on all sides, and we are aligned in our ambition to find a solution, and we have time,” said O'Rourke.

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