China’s road to carbon neutrality is forcing its aluminum smelters away captive from coal-fired power. Despite the energy curbs in Inner Mongolia, the smelting hub of the country, China’s aluminium output rose in March was up 8.5pc to 3.28mn mt from March 2020, according to data release by China’s National Bureau of Statistics.
Many aluminium smelters in Inner Mongolia have reduced output to meet regional energy consumption targets. No new projects will be approved in the region to meet energy targets.
China’s industry ministry stated it would compile records of annual energy consumption by key enterprises in energy-intensive industries — aluminum being one of them. Over 80pc of aluminium capacity in China is based on coal-fired power, according to a Wood Mackenzie report.
Existing smelters are expected to maintain normal production and moderate growth until 2030 when coal-fired power is expected to peak. Gradually, active coal-fired power units will retire as they reach their end of life, which is approximately 20 to 30 years.