when corporations tell governments what to do

[Guest guest]

Rio Tinto Alcan warns Ottawa

ANDY HOFFMAN , Globe and Mail Update

 

 

 

 

Rio Tinto Alcan, the world's largest aluminum producer, warned

Thursday it would consider moving production offshore if Ottawa opts

to impose absolute reductions on greenhouse gas emissions.

 

At an event marking the birth of the new company created by Rio Tinto

PLC's $38.1-billion (U.S.) takeover of Montreal's Alcan Inc., Dick

Evans said regulations mandating overall emissions could have a

devastating impact on its Canadian operations.

 

" If you look at absolute reductions as a solution, the likely

consequence is that you will drive the growth of aluminum production

offshore potentially to other jurisdictions that do not have the same

environmental standards and do not have the same commitments to

greenhouse gas reduction. Therefore the unintended consequences of ill-

conceived legislation or controls could very well be to worsen the

situation rather than improve, " said Mr. Evans, the former Alcan chief

executive officer who has been tapped to run the new unit of the

British mining heavyweight.

 

The current Conservative minority government favours a so-called

intensity-based carbon regime, whereby companies are allowed to

increase emissions as production rises. Opposition parties, however,

have recommended moving to an " absolute " regime, with harder emission

limits.

 

The executive favours reducing emissions on an " intensity " basis -

measured by carbon emissions per unit of aluminum produced - rather

than a cut in the overall amount of greenhouse gases produced.

 

In 2006, Alcan's worldwide operations emitted 20 million tonnes of

greenhouse gases directly from its smelters and a further 11.6 million

tonnes from other sources. A total of 4.3 million tonnes of the

emissions came from its wholly-owned Canadian operations. The company

has committed to a 10-per-cent overall reduction in the intensity of

its emissions on a per unit basis by 2010.

 

Demand for aluminum used in vehicles, electricity transmission and

building supplies is on the rise, said Mr. Evans, the Rio Tinto Alcan

CEO. Alcan's new smelting technology dubbed " AP " is currently the

most

environmentally friendly way to produce the metal.

 

Last year, the company committed almost $600-million towards a pilot

project using state-of-the-art AP50 smelting technology in the

Saguenay Lac Saint-Jean region in Quebec. Run on hydroelectric power

operations owned by Alcan, the new smelter promises to produce more

aluminum with less electricity than traditional smelters. The company

also wants to modernize its Kitimat operations in Northern B.C. with

AP technology that would reduce emissions from 1.3 million tonnes to

800,000 tonnes, but the plan has been stymied so far by regulatory

delays and local opposition.

 

" Our track record in reducing green house emissions on an intensity

basis is outstanding ... So having the most efficient greenhouse-gas-

emitting smelters worldwide is the best impact for the world, " he said.

 

 

Real knowledge is to know the extent of one's ignorance.

Confucius