A letter sent by Ford, General Motors, Rivian, Pepsi, Ball, SunPower and eight more leading companies urges the US Department of Energy (DOE) to invest in American-made clean aluminum to retain and create manufacturing jobs, reduce industrial emissions, and grow a vitally important industry.
The letter to Energy Secretary Jennifer Granholm says that by using investments from the Inflation Reduction Act (IRA) to expand and secure an affordable supply of clean energy, the Biden administration can modernize and grow this industry, rather than letting American-made primary aluminum disappear.
A 2022 report from the Congressional Research Service determined that through 2000, the United States ranked as the world’s largest producer of primary aluminum. By 2021, the US accounted for less than 2% of global primary aluminum production and ranked as the ninth-largest primary aluminum producing country.
Primary aluminum smelting is highly energy-intensive, with electricity estimated to account for up to 40% of production costs. Consequently, a major reason for the decline in US primary aluminum production is that the United States is a relatively high-cost producer.
The world’s leading producers of primary aluminum are generally countries with comparatively low energy costs, including Canada, Russia, and the United Arab Emirates, the CRS report said. By contrast, the United States is a major producer of secondary aluminum. In 2021, more than 75% of domestic supply came from secondary smelters.
Secondary aluminum production is often more economically tenable than primary production, as it is approximately 95% less energy-intensive than primary smelting.
Primary production of aluminum in the United States dropped to some 860,000 metric tons in 2022, down from around 1 million metric tons reported in 2020. US imports of aluminum for consumption reached about 5.9 million metric tons in 2022, up from about 4.3 million metric tons in 2020.
America needs a reliable supply of domestically-produced, clean aluminum. As significant buyers of primary aluminum, we strongly support federal investments via the Inflation Reduction Act (IRA) to ensure that the United States will be a leader in producing this critical material, which is essential to America’s economic growth.
Today, primary aluminum production in the United States is in crisis. While global demand for primary aluminum is forecast to grow over the coming decades, domestic primary aluminum production has continued to decline and is at risk of disappearing. Spiking electricity prices, lack of access to low-cost renewable energy, and insufficient federal investment have pushed the remaining six primary smelters to the brink.
The IRA is poised to make the largest-ever investment in US manufacturing, supercharging aluminum-dependent clean energy technologies. To realize the potential of the IRA, U.S. aluminum demand from wind and solar alone is forecasted to exceed all current aluminum consumption. In order to meet increased aluminum demand that will affect all our industries, the US must invest heavily in supply.—Letter to Secretary Granholm
The actions outlined in the letter would help secure a robust supply chain of sustainably manufactured clean aluminum in the US, reduce emissions, create family-sustaining jobs, and realize the full potential of the landmark climate law. These companies warn the American primary aluminum industry is at risk of disappearing, just as demand is set to skyrocket.
DOE officials are currently evaluating applications from aluminum companies to invest IRA dollars that will reduce emissions from manufacturing processes and power supplies.