A circular economy for the climate and environment

Modell silicon
Elkem’s sustainability philosophy is based on the general principle of producing as efficiently as possible and with the maximum reuse of all side streams like materials and energy.

Elkem’s goal of zero waste means that the company attaches great importance to the recovery and use of side stream- ing of all kinds. A circular economy, where production and consumption are part of a cycle, is necessary if the world’s population is to live well within the earth’s resources.

Elkem’s goal is to ensure that all the plants are equipped with suitable energy recovery systems. Around 200 GWh  was recovered in 2014 in the form of electricity and 400 GWh in the form of steam and hot water.

In 2013, Elkem’s plants in Norway and Iceland became subject to the EU’s system for trading CO2 quotas. Energy recovery measures at the plants and the high consumption of charcoal over many years result in lower net emissions of fossil CO2 and thus less need to purchase quotas.

242,000 quotas

Elkem’s silicon and ferrosilicon plants are based on hydroelectric power, which means there are zero CO2 emissions from electricity consumption. The CO2 emissions largely stem from the actual production processes.

In 2014 Elkem purchased 241,740 CO2 quotas to cover its CO2 emissions from the plants in Norway and Iceland, all of which are covered by the EU’s emission trading system (ETS). This accounts for about 22 per cent of Elkem’s allocated quotas. Companies like Elkem are awarded 75 per cent of their needs based on historical product data, but are credited with quotas for heat sales, energy recovery or using biocarbon for chemical reduction.

Regional quota schemes can present a problem for companies that operate in a global market. For this reason the EU’s and Norway’s schemes to compensate for the indirect effects quota trading has on energy prices in Norway are very important. Even though the ETS price is currently low, it nonetheless entails a mark-up in energy prices that has a significant effect on companies that consume a lot of power, such as Elkem. Elkem received compensation of NOK 31 million1 in 2014 for the impact that prices for CO2 had on energy prices. This compensation scheme is important to counter ‘carbon leakage’, i.e. companies in the European Economic Area (EEA) relocating outside the EEA and thus moving their emissions to another region. Both the awarding of free quotas and the compensation for the impact of the prices for CO2 on energy prices are temporary schemes that will be gradually tightened, meaning that Elkem’s allocations via these schemes will shrink each year, while costs will vary according to CO2 prices as before.

New technology

Absolute emissions of CO2, NOx, and SO2 (sulphur) will in the short-term first and foremost vary with production levels, because it takes a long time to change production technology. This also applies in those areas where technological breakthroughs have been made in the form of scrubbing and changed production processes, because phasing in new technology is often expensive and complicated. Elkem expects a significant drop in NOX and SO2 as new technology becomes available.

As far as net CO2 emissions are concerned, it will gradually become possible to utilise more biological materials in the reduction process as replacements for fossil coal. The work on reducing dust emissions has produced good results in recent years. 

1) Elkem appealed the decision and this was upheld by the Ministry of Climate and Environment in March 2015. However, the final amount of compensation has yet to be finally determined.
The increase of CO2 emissions from 2013 to 2014 is a result of full utilistion of production capacity in 2014.