II. Executive summary
Aluminum holds a pretty positive image in the global marketplace. The metal’s shiny exterior glimmers like an antidote to its heavyweight competitor, steel, or its lightweight, cheap-feeling counterpart, plastic. It holds this image despite the earth- and bone-shattering reality of its production.
From the devastation of some of the planet’s most wondrous features, like Mulanje Mountain in Malawi and the beluga whales of Canada’s St. Lawrence River, to the uncommon death rates of its employees and neighbors, to the global climactic consequences of its emissions, the aluminum industry churns a dark existence behind its shining exterior.
This report examines the global structure and social and environmental impacts of an industry that deserves great scrutiny. Corporations engage in the mining of bauxite, the refining of alumina, and the smelting of aluminum with a reckless abandon that rivals anything done by more-infamous chemical and fossil fuel industrial forces. The industry’s impacts span the spectrum of human and environmental abuse.
Corporate control
A handful of companies — Alcoa, Alcan, Billiton and Norsk Hydro –orchestrate most of the industry’s global activity. Transnational corporations participate in more than 60 percent of the world’s bauxite production. Alcoa alone controls more than one-third of the world’s alumina production. These companies hold large stakes in each crucial step of the production cycle. Alcoa and Alcan absorbed leading competitors in the year 2000, awakening historic fears of monopolism.
Corruption and struggles (fiscal and physical) run rampant in the other concentrated sphere of production, the countries carved from the former Soviet Union.
Dirty Industry Migration
As with many dirty industries, production is increasingly concentrated in the global South. With energy and labor prices escalating in the industrialized West, new capacity almost always is proposed in the developing world.
Bilateral and multilateral development banks are helping to fuel this industrial flight. The World Bank and national lenders have financed, or plan to back, aluminum industry infrastructure privatization or construction projects in Armenia, Azerbaijan, Brazil, Cameroon, China, Egypt, Ghana, Guinea, Guyana, Indonesia, India, Kazakhstan, Malawi, Mozambique, Oman, Russia, Tajikistan, and Turkmenistan. These institutions’ $4.4 billion in financial aid to developing countries mainly benefits western transnational corporations.
One multilateral government arm, the European Bank for Reconstruction and Development, even financed the export of the dirtiest type of aluminum technology — a Soderberg smelter — from an aging smelter in Slovakia to a new one in Iran.
Resettlement
The extraction of natural resources, aluminum’s fodder, begins the industry’s ecological and human toll. While mining bauxite, lignite, and coal, and damming rivers, aluminum corporations have erased villages where tens of thousands of people once lived. Long-time residents of countless communities have been forced to move and make way for aluminum giants’ new strip mines, dams and water courses.
Most bauxite mining occurs in tropical regions peopled by indigenous communities, from northern Australia to South America to west Africa.
In the eastern Indian state of Orissa, indigenous communiities have been trying to stop the construction of the world’s largest new bauxite mine and alumina refinery complex. In December 2000, police allegedly shot and killed three men who lived in a village where people refused to move out for Norsk Hydro and Alcan’s Utkal project.
In Brazil, the construction of the Tucurui dam displaced more than 25,000 people. More than half of the power generated by Tucurui goes to aluminum smelters in northern Brazil. The new reservoir impacted an estimated 100,000 people who drank and fished the river and farmed along the riverbed. After the reservoir was filled in 1984, a prolific outbreak of mosquitoes forced farm families close to the new reservoir to leave their homes. The reservoir also helped to concentrate mercury discharges from upstream gold mining operations in fish tissues.
In Surinam, 6,000 people were forced to move from their ancestral communities in the tropical rainforest to make way for an Alcoa/Billiton dam and smelter. A proposed new dam for a smelter in Sarawak, Malaysia, could force the resettlement of 10,000 indigenous people.
Dr. Kua Kia Soong, head of a non-governmental coalition in Sarawak, wondered, “Why do we want toxic and energy-hungry industries such as aluminum smelters? Aluminum smelting is one industry that the developed countries want to dump on suckers like us because it is environmentally toxic and it consumes voracious amounts of energy.”
Power Hunger
Smelters aggregate around sources of cheap energy, because 45% of the cost of aluminum smelting is electricity. These factories have concentrated around the world’s vastest sources of energy: massive power-producing dams, rich seams of coal, gas fields in the Middle East, and geothermal fields in Iceland.
The industry’s hunger for power produces engineering marvels, tragic disparities and ecological devastation. In places like Surinam, powerlines en route to smelters tower over new communities inhabited by indigenous people forced to move from homelands flooded by new hydroelectric dams. In small countries like Tajikistan, Bahrain, and Ghana, smelters consume a third or more of the national power supply.
Some aluminum companies have threatened to close their smelters in regions where energy prices are skyrocketing, like the Pacific Northwest. Alcan and Alcoa idled smelters in Oregon and British Columbia as prices soared in 2000 and 2001. Where aluminum producers own electricity, they have cut aluminum production to sell power to the grid when prices are high.
“More jobs will be eliminated… if the price of power is right,” predicted a Canadian Auto Workers local union in December 2000.
Cheap Labor
Labor is the industry’s second most costly expense. Many of the biggest companies simultaneously increase profits and lock out restless workers. Transnationals replace lost production from shuttered smelters in the West by maximizing production at cheaper factories in places like Mozambique, where Billiton pays most workers less than 30 cents per hour. Shortly before the Mozambique smelter began production, Billiton announced plans to lay off 5,000 workers from its older and better organized smelters in South Africa.
Aluminum industry laborers, wherever they work, face severe on-the-job health risks. Smelter potrooms are a particularly hazardous workspace. At an Alcan smelter in British Columbia, Canada, over 20 workers have been disabled by or died from on-site exposures to cancerous emissions.
Since the late 1970s, scientists have correlated elevated bladder cancer rates in smelter potroom workers. In 1989, Alcoa told an Australia newspaper that it “emphatically rejects” any such risk for smelter workers. In 1999, Alcoa finally sent warnings to thousands of its workers worldwide that “a small increase in cancer could be expected at lower levels of exposure than had previously been expected.”
Ecological Toll
The industry also exacts steep tolls from surrounding communities and ecosystems. Fluoride emissions from the Nalco smelter in India plague local villagers with brittle bones, tooth and gum diseases, and lumps of dead skin. Their cattle, more prone to fluoride contamination, commonly suffer from bone deformities and rising death rates. In one village within a kilometer of the plant, the local herd of cattle dropped from 3,000 to 100 head in a ten year period. Similar symptoms of fluorosis are apparent in villages around the world’s fourth largest smelter, in Tursunzade, Tajikistan.
A Quebec, Canada, region that hosts four Alcan smelters has the highest birth defect rate in the country. It leads the province in deaths caused by malignant tumors. Biologists have connected emissions from these smelters with cancers in beluga whales downstream in the Saint Lawrence Estuary.
Global Warming
Aluminum smelters’ emissions have a truly global impact. A recent study found that the industry emits about 1 percent of global emissions of man-made greenhouse gases. The industry is a significant contributor to global climate change for two reasons: (1) it consumes enormous amounts of energy, much of it fossil fuels such as coal, that release carbon dioxide when burned and (2) smelters produce small quantities of extremely potent greenhouse gases.
The aluminum production cycle generates an estimated 12 tons of carbon dioxide per ton aluminum produced. Total carbon dioxide emissions are predicted to rise from about 2 billion tons in 1985 to about 3 billion tons by the year 2003.
Roughly one-third of aluminum’s electricity is generated by burning coal. In addition to producing carbon dioxide emissions from captive fossil fuel-fired power plants, the industry further contributes to global warming through its heavy usage of hydroelectric power. In tropical countries, where smelters have congregated around great dams, massive amounts of vegetation decay in flooded forest. Carbon dioxide and methane emissions from the new tropical reservoirs may contribute as much greenhouse gas as would a fossil fuel plant that would produce the same amount of energy, according to a recent World Commission on Dams study. Dams fuel 57% of global aluminum production.
Smelter potrooms produce the industry’s other main contribution to climate change: perfluorocarbons (PFCs). Smelters are responsible for 90 percent of all tetrafluromethane, and 65 percent of all hexafluoroethane emissions worldwide. These PFCs have global warming potentials that are 6,500 to 9,200 times higher than carbon dioxide.
These and other realities did not deter the fiscal optimism of Alcoa chairman Paul O’Neill in 1999. “I don’t see environmental issues as a
negative for aluminum or Alcoa,” he said. “As long as legislatures and governing bodies don’t do stupid things, we’ll be fine.” Mr. O’Neill is now the U.S. Secretary of Treasury under President George W. Bush.
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