Aluminium production costs are made up of several cost items, with energy costs carrying the biggest weight (approximately 35%). For that reason tariffs charged by energy producers are crucial for the development of the aluminium sector in any country.
In China, where energy tariffs are the highest, energy costs per tonne of aluminium output are close to USD 900. The lowest energy costs are paid by aluminium companies in the Middle East and Canada (below USD 350 per tonne). Russia ranks among the countries with the highest energy tariffs.
Producers of aluminium are expanding the use of ‘green’ renewable energy sources, such as hydropower, to improve their electric energy costs. Over a half of the global aluminium output relies on hydropower generation. Limitless resources and an environmentally harmless process are the key advantages of the hydropower sector. Russian aluminium industry has been a leader for some time already in the extent to which it employs environmentally-friendly energy resources – over 80% of its domestic aluminium output is produced using hydropower.
One of the largest electricity consumers in Russia, UC RUSAL, has been actively involved in the joint initiatives of the government and the businesses sector, aimed at shaping a fair and effective national power market.
In Russia, which is home to 90% of RUSAL’s aluminium capacities, transport costs also have a huge impact on the production costs of the winged metal.
RUSAL is in an ongoing dialogue with cargo carriers, seeking to develop a system of effective deductions for major consumers.