Aluminium – powering low carbon aluminium: achieving parity with traditional supply2.3 Aluminium contributes 2% of global CO2e emissions.121Introduction Aluminium demand growth is driven by the transportation sector, power sector, solar frames and cables, buildings and packaging. Producers interviewed for this report emphasized that market conditions and policy design, not technology readiness alone, will determine the pace of decarbonization over the next three to five years. Two overarching messages come through clearly: –Near-term economics are challenging. Several interlocutors described thin margins and buyers that still prioritize lowest delivered price, with little room for a green premium. –Nascent carbon-accounting practices on the buyer side are often based on recycled content rather than the carbon footprint because it is easy to measure, even when a kilogramme-of-scrap proxy says little about the lifecycle footprint of the final product. This misalignment stalls investment in deeper process innovations. A recent full lifecycle (cradle-to-gate) accounting by the International Aluminium Institute (IAI) places average global emissions at roughly ~14.8 tonnes of CO2-equivalent per tonne of primary aluminium (tCO2e/t) produced in 2023, with electricity use in smelting dominating the footprint.122 The latest industry reporting estimates ~1.10-1.12 gigatonnes (Gt or billion tonnes) CO2e of sectoral emissions in 2023 (≈2% of global emissions). Meanwhile, total demand for aluminium is showing sustained growth, with producers accelerating low-carbon power sourcing, inert-anode pilots and expansions in recycling.123 This chapter reflects insights from leading suppliers operating across primary and recycled aluminium value chains. Their collective perspectives reveal both the technological readiness of the industry and the structural barriers that continue to slow investment. Suppliers agree that the sector’s challenge is no longer invention but value-building policies and markets that reward verifiable decarbonization rather than proxy indicators. Sector landscape and maturity curve Emissions reality Globally, the aluminium sector’s emissions intensity has been declining, but not fast enough to meet net-zero targets. Recycled routes are dramatically less carbon-intensive on a process basis (~0.3-0.6 tCO2e/t), although totals depend on electricity and scrap logistics. This puts decarbonization of primary aluminium production to the top of industrial priorities, where electricity remains the dominant driver of primary smelting emissions – offering 70% of decarbonizing potential.124 Turning Challenge into Opportunity: Supplier Voices from Heavy-Emitting Sectors 39

Turning Challenge into Opportunity 2025