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Archive for the ‘Silicon smelters’ Category

PCC Bakki silicon metal smelter to close

 

On Thursday last week, PCC Bakki sent out a press release saying that they would be shutting down the smelter at the end of July. The closure is supposed to be temporary, as they hope to restart after 6-9 months. But whether it will restart is another question.

PCC blame COVID-19 and lack of demand due to it. The Icelandic press, however, have been quick to point out that PCC has suffered economic and technical problems for a long time and have intimated that COVID may just be a pretext. Note that no news of this has appeared on PCC’s international site, nor their Icelandic site, nor their Icelandic Facebook page. Nor has it appeared on any of the English-language news sites in Iceland that I have checked.

Around 80 of 130 workers will be laid off, with more leaving after some modifications have been made to the plant. PCC’s idea is to rehire its current employees when it restarts again. The local council says that efforts will be made to find alternative work for those with families, who have become settled in the nearest town to the plant, Húsavík, but that people living in accommodation on site are likely to be more mobile and will move elsewhere to look for work. An unnamed shop steward said that PCC employees had sensed for some time that the plant would close.

Personally, I can’t see any of the workers deciding to stay in the area on the basis that it might/will reopen at some stage.

Rún­ar Sig­urpáls­son, CEO of PCC Bakki, is realistic and told an Icelandic newspaper that “he hoped he would be able to reclaim his staff. It’s no more complex than that … Whether it will be 6 months or 12 months I can’t say”. But he says that the global demand for silicon metal is low at the moment and the price is low. And the COVID-19 pandemic is by no means over, and it’s impossible to predict when it will end. He then said that for the company to restart, the price for silicon metal would have to rise significantly.

PCC have to keep paying Landsvirkun, their energy provider, as they have a take-or-pay energy agreement. Generally, the buyer has to keep paying energy costs, or at least 80% of the negotiated energy. When no income is being generated, this will be yet another setback that the company will have to face.

One of the arguments put forth for constructing smelters in Iceland has been that it will provide employment, meaning employment for the local community. But this doesn’t happen. Building is usually done by foreign workers as locals don’t want to do it, and it turns out that 30 of the 40 families that have been affected by PCC’s imminent closure are foreign, as are the 40 workers living in purpose-built site accommodation.

Meanwhile, comments on the new EIA for the former silicon metal plant in Helguvík have just closed. Stakksberg, a company set up by Arion bank to see to the sale of the plant that was shut down in September 2017 by the Environment Agency, has been trying to sell the plant for the last three years and I suspect that they hope that if a new EIA is approved, it will help the sale. The locals are against it re-opening, and the local council was also very critical of the EIA, especially in hindsight of its earlier experience with the Helguvík smelter. In my comment to the Planning Agency about the EIA for the Helguvík smelter, I asked whether notice had been taken of the problems suffered by the PCC smelter – and that was a few days before PCC announced they were closing.

I suspect that neither smelter will be operating a year from now.

Update, 2 July: PCC have another glitch to face. About 25% of the silicon metal produced by PCC goes to the USA and is used by the car industry. Not only is the car industry now selling far few cars because of lockdown, travel  restrictions and the like, but American silicon metal manufacturers Ferroglobe and Missisippi Silicon are now pressurizing the American government to impose a tax on silicon metal from Iceland, Bosnia, Malaysia and Kazakhstan because these countries hamper normal pricing and healthy competition.

Iceland’s CarbFix CCS scheme hopes to reduce carbon emissions from large-scale industry

I’ve just had an article published in BBC Future about how the CarbFix version of CCS (carbon capture and storage) can potentially be used to reduce CO2 emissions from large-scale industry, which in Iceland’s case consists of three aluminium smelters, a silicon metal smelter and a ferro-silicon plant.

The CarbFix method is adapted for Iceland’s porous, permeable basalt rock. Instead of taking thousands of years for mineralization to take place underground, with CarbFix it only takes 1-2 years. The procedure has been used to capture both CO2 and hydrogen sulphide from the Hellisheidi geothermal power plant, where CarbFix is in operation, but potentially it could be used for other gases. Read the article to find out more!

A great deal of emphasis in CCS has been put on Direct Air Capture, which is also discussed in the article. Part of the reason for the expense is the need to capture and fix small concentrations of target gases, which is more challenging. A small DAC system is now in operation at Hellisheidi.

Using funds from the EU’s Horizon 2020 programme, the four-year Geothermal Emission Control (GECO) project is investigating the use of CarbFix in Germany, Italy and Turkey near geothermal fields as well as Iceland. As the bedrock in these countries is not basalt, the initial groundwork involves carrying out background studies of potential injection sites, such as the potential of different rock types to mineralize CO2 and permeability. Injection is due to start in 2021.

Emissions from Iceland’s power plants are minimal compared to those in other countries. Nevertheless, Landsvirkjun, Iceland’s national power company that operates three geothermal power stations, is going to build a gas capture plant at one of its geothermal plants, Krafla, using CarbFix to capture the CO2 that is emitted, and in so doing intends to work towards becoming carbon neutral by 2025.

Because BBC attracts a global audience, my editor wanted me to include information on the processes involved in  conventional CCS as well, which I did. Currently, there are 2 large-scale power plants with CCS in operation, but the number of large-scale CCS facilities globally number 21: 2 of these are in power, while the remaining 19 are in industrial applications. I was originally given misleading information on the number of large-scale CCS plants operating, but after the article was published I was told the correct figures (see above), with which my editor says she’ll amend the article (she hasn’t done so yet).

 

 

Silicon metal smelters in Iceland – past, present and future

PCC Bakki are rather secretive about how well their silicon metal smelter in North Iceland is performing. They have not published any news on their website since December last year and their Facebook page gives limited information. Both are only in Icelandic.

However, the German site of the holding company has more recent news, dated April 30: “Our silicon metal production facility in Iceland currently operates with only one furnace. We shut down the second one due to a technical malfunction and it will remain out of operation until the plant constructor has carried out the projected modification of the roof. However, due to travel restrictions because of the coronavirus pandemic, this modification is likely to be postponed to the summer of this year“.

The holding company has an 87% share in PCC Bakki, the remainder being in the hands of Íslandsbanki bank and pension funds.

The PCC Quarterly Report 1/2020 is equally illuminating. Talking about the PCC company as a whole, it says: “The performance of PCC BakkiSilicon hf., Húsavík (Iceland), was adversely affected by the severe winter which lasted into April this year and led to several production interruptions during the quarter. The production output of PCC BakkiSilicon hf. was therefore significantly lower than planned, with corresponding effects on volume and sales. … The earnings for the first quarter of 2020 were likewise below our expectations and down on the previous year. The gross profit ratio declined compared to preceding quarters. The main reasons for this development … were the losses incurred by PCC BakkiSilicon hf.

Towards the end of the report, more information is revealed. After repeating that Iceland’s severe winter weather had been detrimental to the smelter’s performance, the report goes on to say: “Moreover, PCC BakkiSilicon hf. remained unable to fully benefit from the slightly rising price level for silicon metal as a number of old contracts still had to be serviced at low prices during the first quarter. Meanwhile, one of the two arc furnaces has had to be entirely shut down due to the effects of Covid-19 and will probably not be put back into operation until completion by the plant construction contractor of the rehabilitation work on the roof of the facility’s filter house. Due to coronavirus restrictions, this rebuild planned for May will probably be delayed until summer 2020. The second furnace is presently operating stably. Our team on site is also currently working flat out on the implementation of various measures to increase efficiency and thus reduce costs in order to sustainably improve the earnings situation over the long term.

However, it seems, from their Facebook page, that they have indeed being trying to start up the problematic arc furnace in May – unless their “stable” furnace has also been having problems. There are posts dated May 5, May 8, May 14, May 15 and May 28, which detail “cleaning” of one of the furnaces (twice), a broken electrode, unspecified repair work and maintenance work. In each case they warn that white or light-coloured smoke could be expected to emanate from the plant, and sometimes odour is mentioned.

Despite all the problems the PCC plant has been encountering with its “best available technology”, on the other side of Iceland Stakksberg (owned by Arion bank) is still trying to sell the silicon smelter that was owned and operated by United Silicon until it was closed down. Stakksberg have produced an environmental impact assessment for the Helguvik smelter that is composed of a number of separate files, probably in the hope that if the EIA gets approved the smelter will be easier to sell. The EIA is initially aimed at operating one furnace, but this will be stepped up to four furnaces in due course.

One of the files is from the Norwegian Institute for Air Research, NILU. Considering that  odour and respiratory problems were frequent complaints from local residents when the Helguvik smelter was operating, it is somewhat pathetic that NILU cannot provide better information that “While there have been several measurement studies around Norwegian metallurgic industries, no studies especially link emissions to odor and/or health impacts on the nearest neighbours. Nevertheless, we have included summary of three older studies, which we believe are relevant even if the source of emissions is not silicon industries.

I haven’t read the whole EIA, but it would be interesting to know if those responsible for it have probed into the problems at PCC’s smelter at Bakki in the north of Iceland and taken account of the problems encountered there – including such basics as “severe winter weather”. I doubt they have.

Update: PCC have announced that they will be closing their silicon smelter at Bakki, supposedly on a temporary basis. They blame COVID-19 – there has been less demand and prices are lower. There is (as yet) nothing on their website, or the international PCC website, or PCC Bakki Facebook page, but here is a report in Icdelandic giving more information. I will write another blog soon about it.

Icelandic pension funds reduce shares in Iceland’s silicon metal plant

The Icelandic pension funds obviously don’t have much faith in the PCC silicon metal plant in North Iceland, as they have reduced the values of their shares in the plant by 75-100%. Íslandsbanki have also reduced the value of their shares “considerably”, without disclosing how much.

A company called Bakkastakki manages the billion kronur investments by the Icelandic pension funds. The five pension funds involved had acquired a 13.5 % share in Bakkastakki, with the German company PCC SE holding 86. 5% stake in the silicon plant. Icelanders can read about it here.

The reason for the action taken by the pension funds (which PCC had approached last year when searching for more funds) was the great deal of uncertainty about the operation of the silicon plant (i.e. delays and difficulties), coupled with harsh conditions in the commodity markets.

Meanwhile, two and a half years after it was closed down by the Environment Agency, Stakksberg is still trying to sell the beleaguered United Silicon smelter in Helguvik in southwest Iceland. And the PCC problems probably haven’t helped.

Difficult silicon market hinders sale of Helguvik smelter

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.

 

Winter weather causes problems once again for PCC in Iceland

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.

Social impact assessment important in accessing perceptions of projects

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.

 

 

Iceland’s PCC silicon smelter in search of extra funds

The PCC silicon smelter at Bakki, North Iceland, is asking its owners and other investors, such as pension funds, for up to 5 billion kronur (almost $US 40 million) to provide a firmer base for its operations. The majority of the money is expected to come from the holding company of the PCC Group, PCC SE, which has an 86.5% share in the Bakki smelter. Pension funds currently have a 13.5% share in the silicon smelter. PCC SE already provided extra funds last year in the form of a shareholder loan, totalling $US 34 million.

Although PCC SE proudly states: “In the north of Iceland we have constructed one of the world’s most advanced and most environmentally compatible facilities for silicon metal production which was commissioned in 2018”, it has in fact suffered innumerable problems and has frequently, if not usually, operated at reduced capacity due to various problems.

Just this week, the first furnace had to be switched off due to a leak in the cooling system, which led to melting of part of the electrode (þrýstiklemma in Icelandic).  A new part has to be ordered. Note that the PCC website gives very little information about the plant’s problems.

Besides operating problems, the market price of silicon metal has been decreasing recently.

News of PCC’s financial problems must surely make it harder for Stakksberg to sell the former United Silicon plant in Helguvik, Southwest Iceland.

Update 22 September: They say that they have been running at much lower capacity for the last few weeks, and are only producing about 35 tonnes a day instead of 90. It also turns out that there was a second accident involving a “gun” last month, though this was not reported at the time.

 

 

Heavy industry in Iceland looks to CarbFix to become carbon-neutral

Iceland’s four largest CO2 emitters, three of which are aluminium smelters and the other a ferro-silicon plant, have signed a Letter of Intent with the Icelandic government to look for ways to become carbon neutral by 2040. The PCC silicon metal smelter at Bakki, which is another large emitter, is also expected to sign – “although our first priority is to get the operation running properly,” according to the environmental officer there.

The aim is to thoroughly investigate whether the CarbFix method for storing CO2 can become a viable option, both technically and financially, for storing CO2 emissions from these companies.

CarbFix was set up originally in 2007 in conjunction with the Hellisheidi geothermal power station, where CO2 is captured from steam and dissolved in water at pressure. The water is then injected into underground basalt rock at a depth of 500-800 m, where it forms carbonate minerals such as calcite within a few years. These carbonate minerals are stable on a geological time-scale.

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Annual capacity at the Hellisheidi plant is around 12,000 tonnes CO2, which accounts for about a third of the plant’s CO2 emissions. The Hellisheidi plant also removes hydrogen sulphide (H2S) from the steam, but this will not be an issue with the companies intending to become carbon-neutral by 2040.

In 2017, a pilot-scale Direct Air Capture unit was added to the system: this process is independent of location as it mostly relies on energy in the form of heat, which is available as a by-product in numerous industrial processes. Unfortunately the technique is currently too expensive to be used  for making heavy industry climate-neutral.

The project with heavy industry, which is expected to span five to ten years, will involve analysing the concentration of CO2 in emissions, so that similar removal techniques can be applied to those at Hellisheidi. The next step will involve design and manufacture of experimental equipment for capturing and injecting CO2, followed by design and manufacture of similar equipment on a larger scale.

The standard method of carbon capture and storage (CCS) involves pumping oil into old gas fields or using some form of carbon capture and usage (CCU). Edda Sif Aradóttir, who is project manager of CarbFix, says there are both advantages and disadvantages to traditional methods.

“The CarbFix method transforms CO2 into minerals within two years through a chemical process that happens naturally in nature, while traditional methods store CO2 in gas or liquid form. The procedure is thus of a completely different nature and CO2 is permanently removed,” she says.

She says that the main disadvantage is that it requires a considerable amount of water to dissolve the CO2 where chemical changes occur between water and rock. “On the other hand, the water needed by the procedure may be reused, which we in fact do up at Hellisheidi … we are working at developing the process even more so that seawater can be used,” she explained.

Funding for the CarbFix2 project has come from various programmes within the EU, including Horizon 2020, with collaborators in Toulouse, Barcelona and Zurich. CarbFix2 is designed to move the project on from a demonstration phase to one which will lead to an economically viable, complete CCS chain that can be used within Europe and globally.

Future research involves exporting the method to new injection sites in Germany, Italy and Turkey as well as Iceland, and further developing the method so it can be used offshore for permanent mineral storage of CO2 on the sub-sea floor. CarbFix proponents say that there is far more storage available in porous sub-marine basalts than required for the geologic storage of all the anthropogenic CO2 that will ever be produced.

I also wrote about this for ENDS Europe Daily today.

 

Call for Health Impact Assessment for Helguvik silicon smelter

I got a document yesterday from the Planning Agency (now available in Icelandic on the Net) because I’d made comments to a proposal for what should be covered in an environmental impact assessment concerning improvements to the closed-down silicon smelter formerly owned by United Silicon.

Besides allowing comments from the public (which they took no notice of, except to say that many residents had complained of health problems!), they’d asked for comments from bodies such as the Environment Agency, Directorate of Health, the local council, the Marine Research Institute, the Met Office and others.

Some of the information was particularly interesting. For instance, the Directorate of Health said that a Health Impact Assessment should be done because of all the complaints received from local residents. Stakksberg (the current owners) responded by saying that they were not aware of HIAs being done in Iceland, and until legislation was passed about HIAs, they were not going to do one!

When United Silicon was operating the plant, the temperature of the cooling water was 7°C and was discharged into the sea afterwards, when the temperature was not supposed to go over 10°C. Was this the case? No – the maximum recorded cooling temperature of the cooling water was 36°C! As a biologist, I was appalled by this. The draft EIA has to show how much area will be affected by the cooling water and what the temperature difference will be.

The Met Office were concerned about the aquifiers, which they said were very susceptible to disturbance in that area. They also said that there should be a scenario for when the worst possible weather conditions occur, i.e. calm weather/gentle breeze and also when there was high humidity.

They also had concerns about some of the substances emitted from the operation, some of which are bio-accumulative (or accumulate in soils) or do not change into less toxic materials. These substances include heavy metals such as arsenic, persistent organic compounds and sulphur compounds.

The Environment Agency said that because most of the odour problems occur when the smelter is not running at full capacity, a distribution model of pollutants should be done for volatile organic compounds (VOC) with different exhaust temperatures.

The EA also said that the option of not starting up the plant again should be considered.

Many other points came up too, and there were conflicting opinions from different agencies about whether a emergency chimney was needed or not.

I still suspect that the plant won’t start up again. Stakksberg announced long ago that they were trying to sell the plant, but they haven’t succeeded yet. They originally implied that they had no intention of running the plant themselves.

The document I received yesterday raised so many issues that I suspect it will take a long time to process them all.