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No ‘silver bullet’ solution for heavy industries to bring on clean heat

Reinventing industrial processes is a challenge for Australia’s emissions heavyweights as miners and refiners figure out ways to deliver on net-zero promises.

September 29, 2022
By Marion Rae
29 September 2022

Australia doesn’t have to de-industrialise to survive, but it’s going to be complicated and costly.

Fertilisers and explosives, alumina and aluminium, iron and steel, cement and concrete are on the frontline of the net-zero economy that many large companies and governments have pledged to build by 2050 or before.

Grattan Institute climate change and energy expert Tony Wood has told executives at an industry conference they have a crucial role in achieving a net-zero world.

“No sector will be immune,” he warns.

Using renewable energy and alternative fuels such as hydrogen, many producers are working on new ways to make the products that advanced economies take for granted.

For example, as the world’s largest exporter of alumina, Australia’s alumina refining industry emits 15 million tonnes, or about three per cent, per year of the nation’s total greenhouse gas emissions.

Sreeraj Balachandran, climate change manager at Rio Tinto Aluminium, is trialling new processes for Queensland and North American operations.

Speaking at the conference in Adelaide this week, Balachandran urged global executives to work together as the task of switching fossil fuel-powered refineries and smelters to new fuels is too great for one sector alone.

Refineries and smelting operations often run their own coal and gas-fired power plants to provide the high temperatures needed for processing, as the drain on a local electricity grid would be extreme.

Balachandran says electrification of the energy source is the best option as it’s efficient and cost effective.

“But we see hydrogen playing a role where we can’t directly electrify.” 

He says hydrogen can be used in chemical processes, in transport for fuel cells to power mining and haulage fleets and replace diesel, and could be blended as a liquid fuel for industrial processes.

Rio is trialling hydrogen as a replacement for gas in the alumina refining process at the Yarwun plant near Gladstone in Queensland and has Japan’s heavyweight Sumitomo Corporation as a partner for a future hydrogen plant to supply industrial customers.

But hydrogen customers need to be technically ready, having made adjustments to industrial processes, otherwise there’s no demand.

Balachandran says Australia can smooth the way by stoking local demand for the alternative fuel, particularly in Gladstone where a renewable hydrogen hub is forming around existing industry and the port. 

“In developing this energy transition, the local production and local consumption will not only allow the decarbonisation of industry but also underpins a potential export market as well,” he says.

The two key partners for Rio’s industrial changes are Sumitomo – a Japanese bank – and the Australian Renewable Energy Agency (ARENA), Balachandran tells the high-temperature minerals processing forum.

Western Australia is another hot spot for hydrogen, with industry and government working together on the future fuel, and tapping the vast landscape for the large-scale renewables needed to power production.

ARENA is also working with alumina giant Alcoa in a world-first trial of “electric calcination” in the refining process, powered by renewable energy rather than burning fossil fuels.

Calcination is the final step in refining and creates about 30 per cent of emissions in the energy-intensive process that turns bauxite ore into alumina, which is then used to make aluminium.

Alcoa has tested a way of harnessing high-pressure steam, called mechanical vapour recompression (MVR), at the Wagerup refinery in Western Australia.

Using MVR and electric calcination, and powering the refining process with solar and wind energy, researchers say the method could reduce emissions from alumina refining by up to 98 per cent.

Water supply is also a challenge for high-heat industries that have developed over the past 200 years.

Rio and Alcoa say the new methods could slash fresh water use, because energy vented or lost as steam could be captured and recycled back into a plant’s processes.

Alcoa’s Pinjarra alumina refinery in WA is also trialling emerging technology with taxpayer support.

Helen Adamson, a director at industry advisory firm Hatch, says energy efficiency, use and re-use is important because the industrial facilities that need to change are already in operation.

“They’re all configured very differently,” she says.

Existing energy sources can be supplemented with new ones or a whole fuel switch could be possible.

“In many jurisdictions around the world, small nuclear is coming along in a reasonable time frame,” she says.

“The question is how do we put them [small nuclear reactors] to industrial use?”

Thermal batteries are also an option for industries that require high temperature processes, notes Adamson.

A battery being developed by Rondo Energy takes wind and solar electricity and converts it to thermal energy that is stored at temperatures over 1200 degrees, which could leapfrog carbon-capture technologies that rely on gas-powered heat.

Location, energy costs, climate, company commitments and government targets set for producers – or not – all affect decisions.

“So what does the energy pathway look like? It’s not simple. There’s no silver bullet, it’s going to require many, many things.”

Helen Adamson, a director at industry advisory firm Hatch

Grattan’s Tony Wood, a former gas executive, says meeting climate change targets will impose big changes on Australia’s heavy industry and mining sectors.

But reinventing industrial processes is a better option than de-industrialising, he says.

Nor does it make sense to subsidise more fossil fuels as high energy prices reflect the turmoil in the global energy market, not long-term trends.

He says opportunities in critical minerals and ammonia could outweigh economic and job losses.

But governments must recognise that markets won’t deliver the scale and type of change that’s needed.

Wood said industry should be given a clear share of emissions reduction targets and funding to get there, supported by investment rules that support long-term commitments on capital.

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