Musings, politics and environmental issues

On 13 February, I wrote a blog about Iceland’s oldest aluminium smelter, Straumsvik, being under threat of closure. The price of aluminium was very low and the owner, Rio Tinto, said that the Iceland smelter had “uneconomic energy costs”. The smelter was constantly making a loss and production was going to be cut by 15% this year.

Since then, COVID-19 has become a pandemic with countless repercussions for society and industry. Aluminium supply has exceeded demand for some time and industry-wide demand is expected to fall by 8% this year. Car manufacturers, which usually are big buyers, are having to deal with workers in quarantine, curfews and reduced demand for new cars, and companies such as Ford, Peugeot and Volkswagen have already reduced their output.

Aluminium production currently stands at being in excess of 6 million tonnes per year, but if uneconomic aluminium smelters are closed the excess will be reduced to around 4 million tonnes.

According to a report in the Icelandic media (in Icelandic), closing a smelter is an expensive undertaking and the smelter is still tied to its energy contract. One of its (unnamed) interviewees says that the smelter was running at such a loss that it would almost be more economical to pay the electricity cost and close the plant, and that the chances of the Straumsvik plant being closed have increased.

Norwegian company Hydro also say they are considering closing one of their 6 smelters in Norway. The smelter at Årdal mainly makes aluminium for the car industry.

 

 

 

Last week, an Australian tourist died at a hospital in north Iceland. He was admitted when seriously ill, and it turned out that he had the COVID-19 virus but didn’t how typical signs of it. Initially, hospital staff said it was unlikely that he died of the virus but they have now changed their mind, saying that he DID in fact have a severe case of pneumonia, which virus victims may get if badly affected.

The tourist had been travelling around Iceland for a week with his partner. Was he aware of where to go for help? Has anyone has looked into the proportion of “foreigners” and tourists globally who may not know what to do/ where to go in crisis situations, let alone have constant access to hand sanitisers or soap. (Rough sleepers also are unlikely to have access to hand sanitisers or soap, let alone being able to self-isolate away from others, but that’s another story.)

If staying in hotels or guesthouses, the staff should be able to help tourists in trouble, telling them where to find help, etc. But in the case of flats such as Air BnB, there is no guarantee that any such information would be available for guests.

And migrants who do not speak the language of their host country – for instance, many Polish people in Iceland do not speak either Icelandic or English – may also have trouble finding out about latest developments such as bans on gatherings over a certain number, or whether or not to send their children to school. The Icelandic website that gives up-to-date information on the virus, covid.is, is in Icelandic, English and Polish, but is not much use for speakers of other languages.

Although this blog was sparked by COVID-19, it is actually applicable to any health crisis. Crucial information is often not available for everyone, and in some cases elderly family members come to join their family but do not go to school or work and have limited social opportunities and may only speak their heritage language – in which vital information may not be available.

Update 23 March: The Icelandic media reported today that in Sweden,  out of the 27 fatalities due to COVD-19, 6 occurred in people with a Somalian background. The Swedish association of Somalian doctors said that lack of information in Somalian had undoubtedly been partly responsible for the high number of fatalities.

 

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Rio Tinto, owner of Iceland’s oldest aluminium smelter at Straumsvik, has just announced that they will do a strategic review of their Icelandic smelter, as historically low aluminium prices and an “uneconomic energy costs” means they are making huge losses.

They say there is a possibility that the smelter will be closed. The Icelandic company running the smelter, usually known as ISAL, had already announced that production would be cut by 15% this year. Last year, the Straumsvik smelter made a loss of ISK 10 billion ($78.7 million).

Hördur Arnarson, CEO of Iceland’s national power company Landsvirkjun, says he doesn’t think that the price ISAL is paying for electricity is too high. Before he took over as CEO, Landsvirkjun were constantly making a loss, which was partly attributed to low prices to large users such as smelters. Over a period of time, each smelter then negotiated an electricity price for its operations – this was done for the Straumsvik smelter in 2010 – and Landsvirkjun’s finances improved.

Electricity prices for heavy industry are generally not publicized, although now both Rannveig Rist, CEO of ISAL, and Arnarson say they are willing to disclose the electricity price that ISAL has to pay. However, Rist says that compared to the other smelters in Iceland, ISAL pays the highest price for its electricity.

Compared to the price that ordinary customers pay, the large customers still get their electricity very cheaply. In an article in the Icelandic newspaper Fréttablaðið, energy specialist Ketill Sigurjonsson points out that Iceland entices companies that use a lot of energy to the country by promising low electricity prices and later – in this case in 2010 – increase the price. He says that an analysis by the CRU Group revealed that Iceland offers one of the world’s lowest power costs and that only in Canada are operating costs lower than in Iceland.

China has also become very important as an aluminium producer, and is now exporting the metal as well as using it in Chinese factories.

Around 500 people work at the Straumsvik smelter. One of the trade union representatives says that they began to get suspicious about what was about to happen when the parent company refused to agree to wage increases last month, even though these had been agreed by the ISAL wage negotiators and the Confederation of Icelandic Enterprise.

The review is expected to be complete during the first half of this year, and the future of the plant will be decided then.

 

Iceland’s Arion Bank, which has a number of holding companies including Stakksberg, the company entailed with the task of trying to sell the silicon metal smelter in Helguvik originally owned by United Silicon and closed down by the Environment Agency (EA) in September 2017, has sent out a statement saying that they have reduced the value ascribed to Stakksberg from 6.9 billion kronur (USD 52.9 million) at the end of March 2019 to 3.2 billion kronur (USD 25.6 million) nine months later.

Stakksberg has been rectifying some of the problems with the smelter identified by the EA, and has been trying to find a buyer for almost two years. The smelter’s original owner, United Silicon, went bankrupt in January 2018, but in December 2017 they too were searching for buyers.

According to Stakksberg’s homepage, the idea was to have the smelter up and running in the last quarter of 2020.

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Arion Bank says that because of “uncertainty in the market, several manufacturers have reduced their production or closed smelters. Thus unused manufacturing capacity is available that might well have a negative effect on the sale of the silicon metal smelter in Helguvik”.

If they have done their homework, potential buyers – if there are any – would be aware of the problems faced by PCC Bakki Silicon in the north, who asked for more funding last year. PCC have also had unexpected problems with Iceland’s winter weather, and say that the problems they have encountered were not those they were expecting – despite using best available technology, etc. None of this would be of any comfort to prospective buyers of the Helguvik smelter down south.

People involved in ASH, the campaign group against the reopening of the Helguvik silicon smelter, are overjoyed however, as there was a lot of opposition by locals to the smelter during the short time that it was operating.

It’s not just the silicon metal industry that is facing problems. Because of worsening conditions in the aluminium market, which are “very demanding”, Iceland’s oldest aluminium smelter is going to operate at 15% reduced capacity in 2020, with a corresponding decrease in electricity use. The plant is currently Iceland’s second largest user of electricity.

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This smelter, which is situated on the outskirts of the capital city, is currently owned by Rio Tinto Alcan but was searching for a new owner two years ago. Norsk Hydro was going to buy it but the sale fell through seven months later.

Update, 12 February 2019: Rio Tinto has just announced that it will do a strategic review of its Icelandic smelter at Straumsvik, due to high electricity costs – which Icelanders consider are actually very low – and “historically low” aluminium prices. They may even close the smelter. The review is expected to be completed within the next few months.

 

The Scan4Chem app, which was originally launched in Denmark in 2014 under the name of Tjek Kemien, has been replaced by a new version which this time will be Europe-wide.

Jointly developed by Germany, Sweden, Latvia, Austria, Spain, Poland, Czechia, Croatia, Portugal, Greece, France and Luxembourg as well as Denmark, the new version was launched in Sweden, Luxembourg and Germany in November 2019 but was launched this week in the other countries involved. During the next three years, the app will be developed for other countries so that eventually almost every European country will have its own version. The app is available from App Store and Google Play and is free of charge.

Originally, the app was developed by Danish Consumer Council Think Chemicals (DCCTC) and the Danish Environmental Protection Agency, but now is being coordinated by AskREACH. Now, “500 million Europeans will be able to use the same app”, says Danish Environment Minister Lea Wermelin.

Suppliers of articles containing SVHCs (Substances of Very High Concern) have a duty to inform a consumer, if asked, if an SVHC is present at a concentration above 0.1 %, and the consumer must receive an answer within 45 days.

By scanning the barcode of a product, consumers send a request to the supplier to obtain information about the presence of SVHCs in the product concerned. The app scans information provided by the company about the product and can give the consumer an answer immediately. If information is not available for the product, the company will be notified via the app that information about the product concerned must be provided.

Consumers Europe-wide can help each other, says Anja Philip, President of the Danish Consumer Council: “If a German consumer has received an answer about a product, and if it is placed in the database of the company, then a Danish consumer will get the answer immediately when the product is scanned in Denmark.”

Products such as clothing, furniture, toys and electronics can be scanned with the app.

Claus Jørgensen, head of the DCCTC project, says that the original app was downloaded about 40,000 times and that when the app was overwritten, “officially yesterday”, they still had “between 500-1,000 scans per month” for the Danish app.

He says he believes the app “has raised awareness among consumers and companies. Unfortunately, companies chose to answer ‘around’ the app, so that the consumer received the answer, but the answer was not stored in our database for the benefit of other consumers scanning the same product”.

This was the reason for the development of the app Europe-wide, says Jørgensen: “The companies will now face many requests and it will be easier for them to put the data in the database than answering each person individually.”

At least 3 million European consumers are expected to download the new app, although potentially half a billion could do so. AskReach say that 13,460 have downloaded the app for Android and iOS in Sweden since it was launched there two months ago, but it has not been heavily promoted because they want to make improvements first.

Note that the app is not available for the UK – and whether it will eventually be available with Brexit about to happen is an interesting question.

A shorter version of this appeared today on the ENDS Europe website.

It’s that time of year again. New Year’s Eve is approaching and in many countries fireworks are set off, either as organized displays by councils or by individuals. In Iceland, for example, the bulk of the funds from the country’s search and rescue service is provided by firework sales between 28 December and 6 January.

Fireworks are visually spectacular but have a drawback: when the weather is favourable for people to set them off, i.e. no wind or rain, the result can be a firework smog that is debilitating to people with asthma and breathing difficulties and can hang over a city for up to 12 hours, peaking in the first hour after midnight.

Iceland’s Environment Agency produced a report (in Icelandic) on air pollution from fireworks earlier this year. Although the only fireworks that may be sold are those that carry a CE quality label, this does not seem to cover the levels of arsenic, lead and other heavy metals, traces of which can be found in the particulate matter that often hangs over cities in the early hours of New Year.

Despite calls for limits on fireworks that may be sold to individuals in Iceland and other ways of funding the rescue services other than by fireworks, the Icelandic tourist industry has said that many tourists come to Iceland for New Year specifically to see the fireworks, and thus there should be no change to the traditional fireworks celebrations.

Over to Australia, where the traditional fireworks display over Sydney harbour is being questioned this year due to fire danger – Sydney is surrounded by fires and air quality is abysmal – the authorities are determined to go ahead, again partly due to pressure from the tourist industry.

Total madness.

Every year has four seasons: spring, summer, autumn and winter. And houses, machines, equipment and the like should be designed to withstand/operate in all conditions.

This doesn’t seem to be the case for PCC Bakki Silicon, who run the silicon metal smelter at Bakki in the north of Iceland. Last winter – during their first year of operation – they said that the wintry weather was causing them problems, and now it’s happening again.

Earlier this week, Iceland suffered severe storms, the severity varying depending on location. Electricity was cut off in many parts of the north, including at the silicon smelter at Bakki. Initially the electricity supply was disrupted for about eight hours before being reconnected. However, other than news of the supply problem (which appears to have come from the electricity transmission company rather than PCC) there was no news of how the lack of electricity was affecting the smelter.

But it must have had an effect of some sort.

Then yesterday the electricity was disrupted again, allegedly because of “load” on the system. On their Facebook page, PCC said (in a translation from Icelandic):

Due to a breakdown in the Landsnet electricity substation, there is no power to the furnaces at the moment. The emergency chimneys are open, the furnaces are cooling down and thus people could become aware of odours. This breakdown is a result of the stormy weather that went over the country earlier in the week. Great emphasis is put on repairing the damage and we expect them to finish as soon as possible. We will look at the events of the last few days in more detail and report on them next week.

Is it not probable that the same thing happened on Tuesday, i.e. that the furnaces started to cool down and emit odours?

Note that the smelter also suffered problems in late November, when both furnaces were out of action for a while. Did odours occur then too? Quite probably.

This blog will be updated.