1. Ad Hoc Group 3 - Competitiveness Alessandro Profili DEFINITION OF ENERGY INTENSIVE INDUSTRIES

2. Electrolytical process, Hall Hérault (early 900) Extremely high amperage (300kA) 24/365 operation: Anodes Cathode Bath How aluminium is made

3. Primary Aluminium is the most power intensive industrial process Primary aluminum production has the highest electric energy intensity and impact on operating costs among metals Electric power is a raw material of the process Price and availability of electric power are the main drivers of economic performance of existing smelters and location of new ones

4. Aluminium – An integrated industry

5. Why is it so important to keep an aluminium industry in Europe? Our industry would depend on imports to produce aeroplanes,

6. Why is it so important to keep an aluminium industry? Our industry would depend on imports to produce power cables,

7. Why is it so important to keep an aluminium industry? Our industry would depend on imports to lightweight automobiles …. to meet Kyoto objectives … and Europe would lose its current lead in innovative applications

8. Why is it so important to keep an aluminium industry? Our industry would depend on imports to stimulate its creativity in many areas like, buildings transports packaging design and much more

9. Europe is a World leader in technology About 80% of the new smelters built worldwide over the last 15 years are based on European technology. Europe amongst most environmentally efficient operations both in KWh/kg and C02/tonne

10. A World leader in technology and equipment supply for the semi-fabrication industry The strong position of the European aluminium industry has allowed equipment manufacturers to reach a leading position in rolling, foil and extrusion technology supply

11. A World leader in environment friendly recycling processes The European aluminium recycling industry is using advanced technologies in response to the EU demanding environmental legislation European smelters world leaders in scrap utilization

12. Definition of Energy Intensive Electric Power Intensity MWh/t Aluminium is a Leading Indicator

13. Solutions Correct the current electricity market distortions to restore balance between suppliers and consumers. This must lead to a competitive market that will make it attractive for producers to enter into competitive long term contracts with base-load consumers. Find interim solutions : establish a parallel market for energy intensive industries Recognising that electricity is a raw material for energy intensive industry, all environmental taxes and other burdens must be removed as they will only cause further relocation to outside the Kyoto area with no benefit to the global environment.

14. Possible Energy Intensity Criteria Belonging to an Energy Intensive sector - List Consuming a (very) large amount of electricity Power representing a large proportion of total costs (or of value added) Specific consumption pattern – min total hours/year or min ratio off-peak to total consumption Competing on global markets