10.08.20

Five alternatives to aluminium at Tiwai

By Nicola Gaston

The market failure imposed by the use of Tiwai Point as an aluminium smelter does not mean that there are no other good options. Five alternatives are explored by Associate Professor Nicola Gaston, co-director of the MacDiarmid Institute for Advanced Materials and Nanotechnology and a Physicist at the University of Auckland.

First published by Newsroom

So it’s happened. Rio Tinto has announced it is pulling the plug on the Tiwai Point aluminium smelter, due to crashing prices worldwide. Covid-19 is the immediate catalyst, but the problem of what to do with Manapōuri electricity other than put it into the aluminium smelter is an old one: the market failure of having a single customer for a quantity of energy that amounts to more than half that used by Auckland has always been evident.

We are also adjusting to the Zero Carbon Act, passed last year, with big ambitions for a future Carbon-Zero New Zealand. Just last week, Ara Ake (previously announced as the National New Energy Development Centre) was launched in Taranaki, as part of a commitment to a Just Transition away from reliance on fossil fuels. The launch comes in the wake of the cessation of new oil and gas exploration in the region.

So what are the options for the future use of Tiwai electricity, and how do they offer a path to a zero carbon economy? I’ve spoken to some of my colleagues at the MacDiarmid Institute for Advanced Materials and Nanotechnology about where current R&D might guide us, and this is a resulting short list of five ideas – each of which has pros and cons.

1. Shut down Huntly

The most straightforward idea is to simply channel all the hydropower from Manapōuri into the grid alongside the power from the other hydro lakes. The upside is simple: there’s enough power there to completely replace the Huntly power station, our biggest remaining burner of coal. Making New Zealand electricity 100 percent renewable sounds fantastic – but there are a couple of hitches. Firstly, pragmatically, while the price of electricity might initially come down for households, that might undermine the existing business cases for new renewable projects in the North Island, such as those based on geothermal sources. Secondly, the transmission capacity to get all the electricity from Manapōuri to the North Island does not currently exist – and the price tag is around half a billion dollars.

What is perhaps a less obvious cost, but equally significant, is the energy cost of transmission itself: doing anything with energy, even just moving it about, costs energy. This is just the second law of thermodynamics at work. So if we lose something like half of the energy in transmission, then perhaps finding a use for it closer to the source would be preferable – with the additional upside of providing jobs in Southland.

2. Develop energy storage

A well-known issue with renewable generation is that production varies uncontrollably, and asynchrously, with energy use. Energy storage that can even out the availability over different timescales – day and night for solar, or seasons, for hydropower – comes in many forms. Pumped storage, currently being investigated by the Government, may help us mitigate the risk of dry years, or intermittent availability of wind and solar, by cycling water through a hydroelectricity station over and over again, with the input of those renewable energy sources when availability is high.

Professor Justin Hodgkiss, who works on PV solar cells at the MacDiarmid Institute, says: “Ironically today, high uptake of wind and solar may increase carbon emissions due to the need for fossil fuel generation to stabilise the intermittency. Developing green storage solutions are an essential part of decarbonising electricity.”

Other forms of energy storage include large-scale batteries, designed to operate efficiently on much longer time scales than the batteries we use in consumer electronics. But an important form of energy storage that would effectively use the energy generated at Manapōuri locally is the production of green hydrogen: electrolysis produces hydrogen from water, with the only byproduct being oxygen, and when burnt in an engine or used in a fuel cell to produce energy, the only product is water.

The simplicity of this cycle makes it incredibly attractive – it could hardly be cleaner! – but there is of course an energy cost to making the hydrogen (yes, that’s the second law of thermodynamics again). Modern materials that are used as catalysts for electrolysis can get that efficiency to around 80 percent, which is competitive with transmission costs. When pressurized or frozen, hydrogen is transportable – meaning that it can be effectively be used as a transportation fuel, but also that it could be effectively produced in Southland as a commodity for export, like aluminium has been.

The UK National Grid has just released its planning document for Future Energy Scenarios, which identifies hydrogen as the solution to many of the hardest parts of the net-zero transition, in particular in freight, shipping, and heavy industry. Professor Sally Brooker, a MacDiarmid Institute chemist who makes advanced catalysts at the University of Otago and believes that we should be looking to support the Southland economy in the choices we make around Tiwai, puts it succinctly. “We don’t need to do research to make this happen here. We just need to work out whether the economics of doing this here are acceptable to us as a country.”

3. Fuels for decarbonisation of transport

Decarbonising our energy sector will require us to look beyond electricity. The Interim Climate Change Committee has found that the most cost-effective change would be to phase out fossil fuels, and that doesn’t just mean Huntly and the milk powder drying plants that still burn coal. While electric vehicles are starting to make themselves seen (if not heard) on New Zealand roads, using hydrogen as a fuel is a competitive alternative for some applications, as per the UK National Grid report.

A more ambitious change to fuel use is motivated by the 2018 IPCC report, which acknowledged that we have no choice but to look at strategies for negative carbon emissions. Planting trees will work to take CO2 out of the atmosphere, for as long as we are able to increase tree coverage and density. In the longer term, designing molecular sponges that can extract CO2 from air – one example of a technology known as carbon capture and storage, or CCS – may become competitive.

But CCS has its critics; one good reason is that for a long time, the prospect of CCS was used by climate deniers as a reason to wait to cut emissions. But as the IPCC report shows, we are past that; the unresolved critique of CCS is now perhaps just our capacity for it depends on our ability to do something constructive with the CO2 after we capture it.

This problem is being worked on by people such as Professor Sally Brooker; some of the catalysts she is making help to couple CO2 molecules to create carbon-carbon bonds – effectively making it possible to create new fuels. It may seem counterintuitive to think that we could be making hydrocarbons to use as fuels, in the future – but if the carbon accounting adds up, and every hydrocarbon burnt is synthetically produced from atmospheric CO2, then we would have recovered some of the major advantages of fossil fuels, such as their amazing energy density, without having the carbon cost associated with their use.

4.Manufacture silicon solar panels

When I first heard that using the renewable energy at Tiwai to make silicon solar panels was under consideration, I thought it rather a left-field idea. There is serious thought and work behind it however: Tony Baker, a mining engineer behind Southland Silica Ltd, has been working to get buy-in to the idea of using renewable energy to make poly-silicon for solar photovoltaics from local silica deposits (silica being a mixture of silicon and oxygen). “Silica deposits such as Southland Silica has title to are uncommon but being located in close proximity to a world-class hydro plant like Manapouri make them globally unique,” he says. “We should be building industrial scale solar plants adjacent to the North Island population centres.” Tony acknowledges that this is a mining project, but insists that the enterprise would be green, and could result in a significant export industry based in Southland, as well as providing the raw material for energy generation.

On the upside: although silicon PV is an established technology, high quality silicon sources – and green processes for making the material – can still add significant value and international competitiveness. The manufacturing methods currently used to make silicon for solar cells produce 10 tons of CO2 for every ton of silicon produced, with even more CO2 produced as the material is refined. This kind of embedded carbon cost that underlies the production of materials for renewables is what was highlighted in the recent documentary by Michael Moore, Planet of the Humans. While it is true that manufacturing – whether of renewables or not – currently has a high carbon cost, it does not need to stay the case – and using renewable energy to make materials that make renewable energy is how we would change that.

Professor David Williams, an electrochemist at the University of Auckland, reckons that an effective green process might have as inputs, electricity, wood, seawater and sand, and as outputs, mostly chlorine and caustic soda, as well as the high-grade silicon. “Wood as a source of carbon is renewable and has biofuels as a by-product. There is also a new FFC-Cambridge process for making silicon, using electricity rather than carbon.” An experienced founder of several MacDiarmid Institute-affiliated R&D based companies, Williams has looked at the practicalities: “The whole system requires several major industrial processes and is capital-intensive but also knowledge-intensive, and New Zealand at present has all the resources needed: raw materials, smart people and money – it might cost the same as a new motorway in Auckland.”

5. Run green data centres

The fifth option that seems most readily viable, is the idea of using the energy locally to power data centres hosted in New Zealand. The carbon cost of data centres and the associated ICT industry is larger than that of pre-Covid air travel and increasing much more rapidly.

We are all used to monitoring the energy usage of our phones as our batteries run low – but none of us really think of the energy cost of a google search: that each time we perform one, our phones send a signal to a server overseas, which does the necessary computation. Each individual google search may be minor, but in aggregate, our usage of these computational systems is growing rapidly.

Research is exploring new materials to replace the silicon in computer chips, for example, materials that constrain electrons to move on their surfaces, minimising resistance and waste heat. Superconducting materials, or spintronics – materials that use the magnetic interactions of electrons, rather than their charges, to communicate data – are also promising for these new devices. By minimising resistance and the loss of energy as heat (yes, that’s the second law of thermodynamics again) the energy saving is twofold: not only is energy saved, but the need to use additional energy for cooling systems for the data servers can be minimised.

Until such paradigms become standard in computer hardware, the solution is to enable consumers to make a choice, by distinguishing between green data centres, powered by renewables with no associated carbon cost, rather than by the usual mix of energy generation. Establishing such green data centres in New Zealand would have additional advantages – for example, by providing the potential for data sovereignty, which is particularly important to iwi.

So what should we be doing with Manapōuri energy? I think that has to come down to the specifics of the business case, and social licence, rather than the science – and many of these ideas have the ability to co-exist. But I believe it is important that we acknowledge that this is a decision that we make as a country – for our national carbon budget, for the energy needs of Auckland, and for the local economy of Southland. The original and inevitable market failure imposed by the use of Tiwai Point as an aluminium smelter does not mean that there are no other good options; it does mean, however, that the Government has an absolute responsibility to be involved in planning what happens next.

A big part of the decision between technologies will come down to the question of how ambitious we are prepared to be: not just for the Southland economy, and not just for New Zealand’s Zero Carbon aspirations, but for the world as a whole. Back in November last year, the former Greens co-leader Jeanette Fitzsimons argued that to some extent, preserving aluminium manufacturing in New Zealand was of value, despite the costs associated with the Zero Carbon Act having come in – for the simple reason that the source of the energy used to make the aluminium makes the aluminium produced at Tiwai greener than alternatives made elsewhere.

This argument can be true for whatever we choose to use the energy for. But it also suggests that this is one case in which New Zealand should not shy away from ambition. Yes, demand-side changes must be a big part of our energy transition, and improvements to housing and heating, as well as consumer behaviour, are definitely a non-negotiable part of the changes necessary.

But as attractive as it may be to use the excess electricity to do away with coal, to hit that target of 100 percent renewable electricity generation, and congratulate ourselves for living within our (renewable) means: perhaps the better thing – for the planet as a whole – is to look to leverage our renewable advantages for the provision of green technologies that we can manufacture without significant carbon cost. As my colleague Justin Hodgkiss put it, commenting on the recent launch of Ara Ake: “This could be the catalyst to unleash the global commercial potential of low carbon energy R&D carried out in New Zealand.”

Our national energy needs depend on the size of our population, but our potential for renewable energy generation scales, in contrast, with the size of Aotearoa and our natural energy resources. New renewable energy generation – geothermal, solar, wind – in the North Island, where it can be used efficiently, could be complemented by green manufacturing and industries in the South Island, which make effective use of existing hydropower.

Probably, the answer is not any one of the ideas that I have laid out, but a combination of several. The really good news for New Zealand is that we have these, and other options, to choose from as we navigate our path into a carbon-free future.

Photo of the Tiwai Point smelter by Marc Daalder