Aluminum manufacturers in the USA seek affordable and clean energy sources, but finding such power may prove challenging.

In the quest to reshore U.S. manufacturing, two new primary aluminum smelters are planned for Oklahoma and possibly Kentucky, marking the first such facilities in nearly half a century. However, the road to their construction is fraught with challenges.

The production of primary aluminum, essential for a wide range of products from fighter jets to clean energy technologies, requires enormous amounts of power. Hundreds of megawatts are needed to convert raw materials into primary aluminum, and this power must be supplied at near-constant rates. With electricity demand in the U.S. rising faster than supply is forecast to grow, pushing up prices, the economics of powering these smelters become a significant hurdle.

For the economics to pencil out for either facility, power will need to be cheap and produced from carbon-free sources. The U.S. mainly produces secondary aluminum from scrap metal, with over 5 million metric tons produced in 2024. While secondary aluminum production is growing, it cannot fully replace the need for strong and durable primary aluminum.

The deepening power crunch represents a major roadblock in the quest to reshore U.S. manufacturing. Aging grid infrastructure and slow permitting timelines have long delayed the build-out of new power generation. The Trump administration and GOP-led Congress are creating additional financial and legal headwinds for wind, solar, and battery storage projects.

The primary aluminum industry in the U.S. experienced a downward spiral after China joined the World Trade Organization in 2001, leading to a glut of inexpensive Chinese aluminum on the global market. The Aluminum Association, in its white paper titled "Powering Up American Aluminum," identified deregulation as the single most important factor leading to the near total demise of the primary aluminum industry in the U.S.

Despite these challenges, the Department of Energy awarded Century Aluminum a grant of up to $500 million as part of a federal industrial decarbonization program. However, much of this funding has since been defunded. The search results do not provide specific information about which companies are involved in the planning and construction of the two planned new aluminum smelters in the USA.

Producing aluminum contributes about 2% of total greenhouse gas emissions every year, with the majority of those emissions coming from generating high volumes of electricity to power smelters, often derived from fossil fuels. As the world moves towards cleaner energy solutions, the need for carbon-free power sources becomes increasingly important for the aluminum industry.

Primary aluminum is used to make products as varied as fighter jets, power cables, soda cans, deodorant, and clean energy technologies like electric vehicles, solar panels, and heat pumps. The revival of the primary aluminum industry in the U.S. could have significant implications for the country's manufacturing sector and its commitment to clean energy technologies. The construction of the two planned smelters in Oklahoma and Kentucky will require each plant to consume enough electricity annually to power the state of Rhode Island.

As these new facilities move forward, it will be interesting to see how the challenges of power supply, funding, and competition from foreign markets are addressed. The resurgence of American aluminum could be a significant step towards a more sustainable and self-reliant manufacturing sector in the U.S.

Aluminum manufacturers in the USA seek affordable and clean energy sources, but finding such power may prove challenging.