Constellium plans more aluminium recycling, wary of EU carbon rules

PARIS (Reuters) - Aluminium parts maker Constellium is increasing its recycling capability, taking advantage of the metal’s reusability to meet calls for lower-carbon output, but investments in Europe will depend on emissions rules not hurting local industry.

FILE PHOTO: Compressed aluminium cans ready for recycling are seen at the Constellium production unit in Biesheim, eastern France, April 9, 2018. REUTERS/Vincent Kessler/File Photo

“We’re investing to increase our recycling capacity and we see this as a big opportunity for us in the future,” Chief Executive Jean-Marc Germain said in an interview during LME Week, an annual gathering of metals consumers, producers, traders and brokers.

“In Europe we are looking at different scenarios.”

Aluminium’s appeal as indefinitely recyclable has attracted the interest of beverage makers faced with an outcry over plastic waste, prompting some drinks firms to switch to cans from bottles.

Recycling also reduces aluminium’s considerable carbon footprint, linked to the energy-intensive production process for primary aluminium.

Constellium, a leading supplier of products for sectors including packaging and car and plane manufacturing, expanded recycling in the United States two years ago by launching a new furnace at its Muscle Shoals plant in Alabama.

Yet the group is waiting to see if EU emissions policy takes into account the overall benefit of a recycling project along the supply chain, or takes a narrower approach that would force a firm to buy carbon credits to cover a recycling furnace.

“It would be a pity that due to this policy of making energy more expensive ... it would be more economical to go elsewhere and buy primary aluminium produced using coal-fired power,” he said in an interview at Constellium’s Paris offices.

Recycled aluminium is estimated to consume 5% of the energy required to make new aluminium and Germain said using coal-based power increases the metal’s emissions by three or four times.

He declined to disclose Constellium’s recycling rate or detail its suppliers of primary aluminium.

Constellium supported the idea of a carbon tax at the EU’s borders in order to prevent local industry being penalized by imports not subject to the same emissions standards, he said.

But its application could prove complex when dealing with products like cars that have large numbers of parts, he added.

Constellium, whose roots lie in former French aluminium maker Pechiney, was also facing pressure from its clients to guarantee lower-carbon supply.

It has begun certifying its sites under the industry’s “Aluminium Stewardship Initiative” and this was expected to lead it to change its mix of raw material suppliers, Germain said.

Reporting by Gus Trompiz; Editing by David Holmes