UK Metals Expo: ALFED Panel Slides

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www.alfed.org.uk 0333 240 9735 The Voice of the UK Aluminium Industry Unlocking the Economic Viability of Recycled Aluminium
www.alfed.org.uk 0333 240 9735 The Voice of the UK Aluminium Industry Aluminium as a Strategic Metal • Vital part of a wider economic toolkit • Offers a clear, long-term vision • Ensures national accountability • Prevents inequality, allows the UK to compete on a global stage • Enables growth in the green economy

The Value Proposition

• By adopting recycled aluminium, manufacturers can realise cost savings, reduce environmental impact, and position themselves as leaders in sustainable and responsible business practices.

• Addressing threats to the UK aluminium market is essential to unlocking the full potential of recycled aluminium and driving its adoption across various industries.

0333 240 9735

The Voice of the UK Aluminium Industry

www.alfed.org.uk

www.alfed.org.uk 0333 240 9735 The Voice of the UK Aluminium Industry Today’s Panel Christopher Pilgrim Knowledge Transfer Manager - Materials Innovate UK KTN Rachel Wiffen Senior Engineer, Quality Systems Manager Innoval Technology Gerald Keen Director BACALL Tom Giddings Executive Director Aluminium Packaging Recycling Organisation Ltd (Alupro)

Unlocking

The Economic Viability Of Recycled Aluminium In Manufacturing: The Packaging Perspective

Market and Recycling Rates

Government Policy and Promoting Recycling – Intrinsically Linked?

So what? – Takeaway thoughts

Content
Context –

SO, WHAT’S THE BIG PICTURE?

Context – Market & Recycling Rates

UK Market – The Biggest In Europe! Recycling Rates Keep Pace!

46% 47% 48% 50% 50% 51% 52% 56% 68% 68% 66% 65% 65% 69% 71% 72% 71% 76% 82% 82% 40 60 80 100 120 140 160 180 30% 40% 50% 60% 70% 80% 90% 100% 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Aluminium Packaging Recycled (Tonnes) Recycling Rate (%) Year Aluminium Packaging Recycling 2012 to 2021 All Aluminium Packaging - Recycling Rate (%) Beverage Cans - Recycling Rate (%) 150 170 190 210 230 250 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Aluminium Packaging Market (Kt) Year UK Aluminium Packaging Market 2012 to 2021

GOVERNMENT POLICY & PROMOTING RECYCLING – INTRINSICALLY LINKED?

Recycling Aluminium Packaging Is Already Viable!

68% 82%

Recycling Rate for All Aluminium Packaging in 2021

Recycling Rate for Aluminium Beverage Cans in 2021

So, how can this be improved?

Government Policy? It can be good… …or very bad!

Policy & Recycling – A Question of Good Design!

The Opportunities…

• A well-designed Deposit Return Scheme for Drinks Containers could:-

– Bring recycling rates to 90%...

– …At a low cost for brands who use this sustainable and valuable material…

– …provide high quality recyclate for the circular economy…

…And revolutionise attitudes to recycling!

• A well-designed Extended Producer Responsibility (EPR) system could:-

– Drive collection and recycling rates of all aluminium packaging typed up…

–…Incentivise the use of recyclable packaging…

– …And spark innovation in recycling technology and systems!

The Risks…

• A poorly-designed Deposit Return Scheme for Drinks Containers could:-

– Damage the market for cans (by up to 25%!), particularly multipacks…

– …needlessly charge those wanting to use cans for setting up YET ANOTHER ineffective collection system…

…annoy the public and ‘switch them off!’

• A poorly-designed Extended Producer Responsibility (EPR) system could:-

Fail to take account of circular economy potential of aluminium compared to other materials…

– …be so onerous that it suppresses innovation…

– …AND lack the ‘teeth’ to actually deliver recycling rate improvements, being an expensive ‘white elephant.’

OR OR

So, how does our industry help with getting the right policy?

Vision

A world where consumers know that they can recycle their empty aerosols in their kerbside recycling, and be confident that their packaging waste will be collected, sorted and recycled responsibly.

Key Messages

More aluminium packaging than ever is being recycled, but there’s room for improvement…

…policy can help, but also hinder,

…collective action by industry CAN HELP GET GOOD POLICY…

…and realise the circular economy for aluminium packaging!

Unless otherwise stated, all rights are reserved. No part of this document may be photocopied, reproduced, translated to another language, or transmitted in any form or by any means, electronic or mechanical, for any purpose, without the express permission of Innoval Technology Ltd.

The information contained in this document is subject to change. Notice of changes will be made only to the parties deemed relevant by Innoval Technology Ltd.

Innoval Technology Ltd assumes no responsibility or liability for any errors that may appear in this document or for any incidental or consequential damages.

© Innoval Technology Ltd 2023 | ICJ23-016 16
© Innoval Technology Ltd 2023 | ICJ23-016 See https://www.innovaltec.com/case-studies/ Global client base. Diverse range of markets Long-term collaborations 90%+ repeat business. Committed to R&D collaboration.

Comparison of aluminium price, LME vs UBC baled scrap vs old rolled scrap

Data source: letsrecycle.com

© Innoval Technology Ltd 2023 | ICJ23-016 18 0 500 1000 1500 2000 2500 3000 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15 Jul-15 Jan-16 Jul-16 Jan-17 Jul-17 Jan-18 Jul-18 Jan-19 Jul-19 Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22 Jan-23 Jul-23 £ / tonne
LME monthly average
Old Rolled UBC scrap (baled)

Scrap,

Casting, Extrusion, Forming, Joining, Testing,

Design & CAE/FEA, LCA

Design, Specifications,

Manufacturing, Testing

© Innoval Technology Ltd 2023 | ICJ23-016
19
Scrap sorting, & Scrap blending

Economic Viability is informed by financial analysis but takes a broader approach to costs and benefits than just financial considerations.

The economic analysis typically encompasses a larger geographic scale, examining the national or regional implications of the project and social and environmental externalities.”

Hydropower sustainability council: Hyrdosustainability.org

© Innoval Technology Ltd 2023 | ICJ23-016 20
www.ktn-uk.org Unlocking the Economic Viability of Recycled Aluminium in Manufacturing Dr Christopher Pilgrim 14th September 2023 UK Metals Expo - 2023

Environmental impact – Net Zero

• Net Zero can’t wait to 2050

• Delink growth in aluminium production and GHG emissions

• Electricity decarbonisation, direct emissions reduction and resource efficiency

• “To avoid the GHG emissions overshoot, the increase in the demand for virgin aluminium would need to slow and even reverse from current levels.” Eunomia report, 2022, Is Net Zero Enough for the Materials Production Sector?

https://www.eunomia.co.uk/reports-tools/is-net-zero-enough-for-the-materials-production-sector/

Recycling is essential but insufficient

Unlocking the economic viability of recycled aluminium

Exporting economic opportunity

Export millions of tonnes of aluminium as low grade material, import as high grade for billions of £

Demand for material

Customer awareness and demand for recycled materials is increasing.

Environmental impact

Demand for aluminium is set to increase significantly – must use existing material

Under increasing scrutiny. Recycling can reduce impact but only part of wider solution.

Circular Economy Innovation Network -

Aluminium

Greener aluminium Maximise re-used Do more with less

Alloy design Disassembly & Reuse Certification

Maintain value

Increase recovery systems

Innovative thinking

Capability training

Shorter closed loops

New revenue streams

Pathway to accelerating circularity of aluminium

Related Innovate UK programmes & opportunities

11th October – Webinar

“Taking action towards circularity in aluminium”

Transforming Foundation Industries Resource Efficiency for Materials & Manufacture

Cross-sector collaboration between the Foundation Industries

Metals, Cement, Ceramics, Chemicals, Glass, Paper

Inaugural Innovation Pavilion here at UK Metals Expo Stand T34

UK to be a leader in resource efficiency Across all materials

Expressions of interest:

Rapidly find innovative solutions to materials and manufacturing challenges

Closes 30th Sept.

Economy Innovation
Circular
Network
www.alfed.org.uk 0333 240 9735 The Voice of the UK Aluminium Industry How a UK Industrial Strategy Matters and how we get there.

It is no coincidence that the UK manufacturing sector is at one of its weakest points in history.

The governments duty is to create a competitive trading environment that allows the UK industry to succeed, grow and lead the green transition.

The Voice of the UK Aluminium Industry Introduction
www.alfed.org.uk 0333 240 9735

• Enables growth in the green economy

0333 240 9735 The Voice of the UK Aluminium Industry Why is an Industrial Strategy Important?
www.alfed.org.uk
• Vital part of a wider economic toolkit • Offers a clear, long-term vision
• Ensures national accountability
• Prevents inequality, allows the UK to compete on a global stage

What steps are needed to implement?

• We need clear objectives

• We must learn from international best practice

• It should be implemented and governed by a separate body

• It needs to deliver on key commitments (skills, infrastructure, finance, R&D, etc...)

www.alfed.org.uk 0333 240 9735 The Voice of the UK Aluminium Industry

Considerations for a successful strategy:

• Should include horizontal and vertical elements to inspire an integrated industry that accounts for energy and climate policies

• Must adapt to changing business environments

• Mustn’t protect businesses from transitional change

• Should create conditions for new ideas to be commercialised and businesses to grow

The Voice of the UK Aluminium Industry
www.alfed.org.uk 0333 240 9735

The role of aluminium:

• Key to driving industrial change and sustainable progress

• Has a significant strategic value to future innovation across multiple sectors (increased investment is essential)

• Perfectly positioned to capitalise on demand for sustainable materials

• Contributor to key industries

• Essential to driving future innovation

0333 240 9735

www.alfed.org.uk

The
Voice of the UK Aluminium Industry

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