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[GreenYes] Spewing out yet more aluminum...
Hello BBANers and GreenYesers:
Below are two stories about how Alcoa just signed a deal with the government 
of Iceland to build a 295,000 ton aluminum smelter which would be supplied by 
numerous new dams and a 500-megawatt hydroelectric power plant.  While Alcoa 
charges that the project is benign, local and international environmentalists 
disagree.  They warn that  sensitive habitat will be irreparably harmed by 
the project, threatening pink-footed geese and reindeer, and inundating 
spectacular canyons. The low cost of electric power in the deal makes this 
Icelandic site more attractive for smelting than higher cost areas--such as 
the U.S. Pacific Northwest.  

Is it worth it to destroy Europe's second largest wilderness area for 295,000 
tons of aluminum a year?  As the recent CRI report "Trashed Cans" pointed 
out, Americans wasted 790,000 tons of aluminum cans last year--MORE THAN TWO 
AND A HALF TIMES the anticipated Icelandic production capacity.  (This report 
can be ordered at

Wasting notwithstanding...does the world really need the aluminum from this 
new development project and others like it? Not according to industry analyst 
Deutsche Bank.  According to a recent report, "This growth in capacity is the 
primary reason why we think the primary aluminium market will remain in 
surplus over the period 2002-2004 and price appreciation will be limited."  

Oversupply in the primary market is directly linked to depressed prices for 
UBCs...a disappointment to curbside operators who look to aluminum can 
revenues as their salvation.

For more information on these issues, please contact me (Jenny Gitlitz). News 
stories follow.

Iceland Chooses Smelter, Hydro Project over Park
REYKJAVIK, Iceland, July 23, 2002 (ENS) - The world's largest  aluminum 
company, Alcoa Inc., the government of Iceland, and Landsvirkjun, Iceland's 
national power company have signed a deal to build a large aluminium smelter 
and hydropower development in eastern 
Iceland. The pact, signed Friday, drew immediate condemation from  WWF, the 
conservation organization.

WWF has vowed to continue to press for a national park in eastern  Iceland 
instead of the combined smelter and hydro project, which will be the largest 
ever infrastructure development in Iceland. It  involves the construction of 
a 190-meter (623 foot) high dam as well  as other smaller dams, tunnels, 
power lines, roads and a 57 square kilometre (22 square mile) reservoir.

Alcoa says that when completed, the project will represent one of the  
largest private sector investments in Iceland's history and "one of  the 
cleanest aluminum production facilities in the world."

This "sustainable development project" is designed to create hundreds  of 
new, permanent jobs in eastern Iceland helping to put the economy   there on 
a more solid foundation, Alcoa said in a statement. "A stronger economy in 
the region will allow for improvements in  transportation, education, 
healthcare and culture."

But the WWF charges that the development will affect wildlife and  plants 
over 3,000 square kilometres (1,158 square miles) of Icelandic  wilderness - 
some three percent of Iceland's total land area - and destroy parts of the 
unique Dimmugljufur canyon, Iceland's Grand 

WWF criticised the Icelandic government for ignoring strong support  for a 
national park in the Eastern Highlands. Samantha Smith,  director of WWF's 
International Arctic Program, said, "A new Gallup poll in Iceland shows that 
65 percent of Icelanders want a national    park in the Eastern Highlands, 
which includes the area the project will destroy. But the government seems 
determined to build this  project before it will seriously consider the 
different options for a 

"If the project stays on its fast track, some of the most valuable  areas 
will be destroyed before a national park is in place," said Smith.

Alcoa says Landsvirkjun will begin development of a 500-megawatt  hydropower 
facility in eastern Iceland, and Alcoa will complete environmental and 
engineering studies of the smelter near Reydarfjordur in eastern Iceland.

The deal also encompasses a harbor facility at Mjoeyri and related  
infrastructure development. 
Icelandic waterfall (Photo courtesy Robert Loney)
WWF, and an alliance of Icelandic conservation organizations,  including the 
Iceland Nature Conservation Association, campaigned for Alcoa to withdraw 
from the project, since it stepped in when the Norwegian company Norsk Hydro 
pulled out of a similar project earlier 
this year.

The national park that the alliance is proposing in the Eastern  Highlands 
would be bordered by the Vatnajökull glacier in the south,   the Vonaskard 
canyon in the west, the Lonsoderaefi highland plains to the east, and the 
National Lands boundary to the north.

WWF is offering to commission an initial study for the national park,  
including detailed boundary planning, protected area categorization, and 
implementation planning.

The study would also look at eco-tourism, research and other low  impact 
activities in the area as alternative income sources for local  communities, 
and provide an analysis of the political and formal steps necessary to 
implement such a comprehensive protected area plan  for Iceland.

Alcoa serves the aerospace, automotive, packaging, building and  
construction, commercial transportation and industrial markets.

As the construction process continues, Alcoa said, it will "work to  meet the 
company's high standards for sustainable development."

But the conservation organization says Alcoa has already violated its  own 
princples. Smith said, "Alcoa is ignoring its own principles of  
environmental integrity."

Copyright Environment News Service (ENS) 2002. All Rights Reserved.

Environmentalists urge Iceland to scrap Alcoa plan
Story by Alister Doyle
NORWAY: July 25, 2002
OSLO - Environmentalists urged Iceland and U.S. aluminium giant Alcoa  Inc to 
scrap plans to build a smelter fuelled by a huge hydropower  plant in one of 
Europe's last wildernesses.

The World Wide Fund for Nature (WWF) conservation group said it  wanted 
Iceland to declare the eastern highlands a national park, saying they would 
be irreversibly damaged by dams and reservoirs in the multi-billion-dollar 

Alcoa, the world's top aluminium producer, signed a memorandum of 
understanding on Friday with Iceland's government to cooperate on a 295,000 
tonnes per year smelter to be fed by a 500-megawatt hydro-electric power 

Reykjavik and Alcoa say the project would cause little pollution and  have 
limited impact on local ecology.

But WWF said dams and a 43 sq km (16.6 sq mile) reservoir would flood  
regions used by reindeer and pink-footed geese in glacier-fringed highlands. 
The reservoir would drown parts of the spectacular Dimmugljufur canyon.

"We'll work for a national park instead," said Julian Woolford at the WWF 
Arctic Programme in Oslo. "We want to develop options of eco-tourism."

Woolford said there was enough hydro-and geothermal power near the  capital 
Reykjavik in the west to fuel any new smelter without touching the 
wilderness. Iceland already has two aluminium smelters in the west of the 
North Atlantic island.

Reykjavik's government, which has backing from most of parliament for  the 
long-debated plans, reckons the scheme could mean perhaps 1,000 permanent 
jobs for the remote region. And officials say new roads and investment could 
foster tourism.

Hydropower is a non-polluting energy usually hailed by environmentalists as 
far better than fossil fuels or nuclear power. But in recent years many 
environmentalists have criticised big new 
hydro projects.

Alcoa has agreed to guarantee 75 percent of the costs of road and bridge 
construction leading to the planned hydro-electric plant in a preliminary 

Iceland and Alcoa hope to work out details including energy costs, taxes and 
construction sites by January.

"The power plant and the dams will destroy the wilderness," said Arni  
Finnsson of the Icelandic Nature Conservation Association, which  cooperates 
with the WWF.

He said the region was Europe's second largest wilderness behind Svalbard, an 
Arctic archipelago run by Norway.

National power company Landsvirkjun says animals are likely to adapt  to the 
damming and that no endangered plant species had been found in areas to be 
flooded. New reservoirs could encourage trout and other fish.

"The hydropower project will...have positive economic impact both  locally 
and nationally," Landsvirkjun said in a statement.

Kolbrun Halldorsdottir, a member of parliament of the opposition Left Green 
Movement, said the government had been unwilling to discuss a national park.

"The whole project is short-sighted," she said, adding that smelters built in 
remote parts of Scotland and Norway had sometimes failed to stop a drift to 

Jennifer Gitlitz

Director of Research, Container Recycling Institute

Home office:

1010 Pleasant St.

Worcester, MA 01602

Phone: (508) 793-8516

eFax: (928) 833-0460


Container Recycling Institute
1911 Ft Myer Drive, Suite 702
Arlington, Virginia  22209
Phone: (703) 276-9800  
Fax (703) 276-9587
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