Musings, politics and environmental issues

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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.

Iceland’s environment ministry has just held a symposium on social impacts of energy projects in Iceland, in particular in relation to new power plants envisaged as part of the 4th Master Plan for Nature Protection and Energy Utilization. Key speakers were a couple now living in the Netherlands: an academic from the University of Gröningen, Frank Vanclay, and his practitioner wife, Ana-Maria Esteves, who works with the International Association for Impact Assessment (IAIA).

Much of the symposium was related to social environmental assessment itself, irrespective of country. So for instance when a fracking project is announced, there might be impacts from vehicle noise of various types, exhaust fumes, increased accident risk, injury or even death, costs of road repair from increased traffic, and changing character of the town (less peaceful, etc.). These are balanced by the potential for local income from spending by drivers, plus other services for drivers.

Everything is social, Frank said: landscape analysis; archeological and heritage impacts; community, cultural and linguistic impacts; demographic and economic impacts; gender issues; health and psychological impacts; political issues such as human rights; resource issues, and indigenous issues. Social impacts depend on project characteristics, as well as characteristics of the community, individuals and any proposed mitigation. Impacts cannot be measured in advance, but social impacts should be done before environmental impacts. Speculation starts as soon as there is even a rumour of a proposed development, he says. If there is no consensus, projects should not proceed.

As an activist, I found his slide on the different types of protest interesting.

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Ana said that “the purpose of benefit-sharing is to retain part of a project’s economic benefits in the region where the project is located”. These may be voluntary or non-voluntary, monetary or non-monetary. Who decides, who distributes, who benefits? And how do people perceive negative aspects?

The Icelanders who spoke brought up local issues. Birna Björk Árnadóttir from the Planning Agency brought up the case of a proposed hydropower plant, Hvalár, in an isolated region of northwest Iceland where people have been divided into two factions: proponents (mainly locals) who say “this is our project, let us decide” and opponents, who say “to whom do the fjords belong”?

In line with some of what Ana said earlier in the symposium, developers of this project have promised various benefits for the local villagers.

In terms of social impact assessments for power plants, the following should be covered: access to electricity and electrical safety, population changes, land use, employment, property value, fringe benefits and perks, public health, cultural heritage, and tourism and recreation. Employment weighs heavily in the assessments, whereas tourism and recreation are usually the most-researched factors.

In Iceland, social impact assessment has only been carried out with large projects such as construction of the dam and aluminium plant in East Iceland. Given the proximity of the currently non-operating silicon metal smelter in Helguvik, south-west Iceland, to local communities, it would have been better if a social impact assessment had been carried out there first. Stakksberg, the company set up by Arion Bank to see to the amendments and potential sale of the smelter, could still decide to carry out a social impact assessment for the project – but I doubt they will.

 

 

A ban on heavy fuel oils (HFOs) in the Arctic could be expected in 2022/3, according to the Clean Arctic Alliance which held a seminar in the run-up to Iceland’s annual Arctic Circle Assembly.

A draft methodology for analysing impacts of a ban on HFO for the use and carriage as fuel by ships in Arctic waters was agreed at a February meeting of the International Maritime Organisation (IMO).

The Marine Environment Protection Committee (MEP72) held a meeting in April at which it was decided to move forward on developing an HFO ban in the Arctic. A ban already exists on HFO use in the Antarctic.

Out of eight Arctic states that are pushing for a ban, only Canada and Russia have not yet supported it – though they haven’t opposed it either – but Russia has been making suggestions and Canada wants a study done on the impact of a ban on coastal communities. They basically have not made their position clear.

Nevertheless, an important step will be achieved in January 2020 when sulphur content in fuel will be limited to 0.5%, down from 3.5%. Currently, most vessels use HFO with a sulphur content of 2.7%.

In Iceland, sulphur content of shipping fuel within 12 nautical miles of land must be limited to 0.1% from January 2020. However, HFO will be permitted if scrubbers are used. Anywhere outside of this area comes under the jurisdiction of the IMO. The reduction “will solve some problems but not all”, according to Árni Finnsson from the Iceland Nature Conservation Association, which organised the seminar.

Currently, 76% of fuel used in the Arctic is HFO. Vessels that spend long periods at a time in the Arctic are especially likely to be using the fuel. Some ships are fitted with scrubbers, which are designed to remove sulphur, but if vessels are using open-loop rather than closed-loop scrubbers – as 80% of boats do – the resulting effluent is also polluting.

Lighter fuel blends are being developed, but as these are mixed on board, HFO will still have to be carried, with the potential of oil spills that are hard to clean in the Arctic.

The Clean Arctic Alliance, a global body consisting of 18 organisations, is pushing for the use of the lighter distillate fuels, which already meet emission requirements for sulphur. When distillates are used, particulate filters could be installed to reduce black carbon emissions by over 90%. The Alliance points out that between 2015 and 2017, there was a 30% increase in the number of HFO-fuelled ships and 50% increase in black carbon emissions from HFO use.

Particulate filters cannot be used with HFO, as HFO contains too much carbon. The warming impact of black carbon in the Arctic is three times higher than over the open ocean.

“The ocean has been absorbing large quantities of emissions, equivalent to 20-30% of CO2 emitted by human activity since the 1980s. We need to achieve net zero emissions by 2050,” says Dr Sian Prior from the Clean Arctic Alliance..

Most of the area around Svalbard is already subjected to an HFO ban.

This blog was originally written for ENDS Europe.