Partners in innovation

Features - Aluminum Sorting

Aluminum producer Novelis has invested in Sortera Alloys, which will process manufacturing scrap for the company, allowing Novelis to increase recycled content in its automotive sheet products.

September 16, 2022

© Nataliya Hora | stock.adobe.com

In May, Emilio Braghi, executive vice president of Novelis Inc. and president of Novelis Europe, presented the keynote address at the 27th World Aluminium Conference in London, organized by CRU International Ltd. He addressed the energy efficiency of using scrap in aluminum production, noting that it requires approximately 5 percent of the energy used to make primary aluminum, thereby avoiding approximately 95 percent of the carbon emissions associated with primary aluminum production. Braghi added that systems that incentivize circular products and investments in collection and sorting are needed to help the industry make the best use of aluminum scrap.

To further developments in the area of scrap sorting, Novelis, a subsidiary of Hindalco Industries Ltd., the metals flagship company of Mumbai, India-based Aditya Birla Group, announced in July that it had taken a minority position in Sortera Alloys Inc. of Fort Wayne, Indiana, through its Novelis Ventures team, and had established a long-term commercial agreement with the company.

“Novelis will use this material to increase the recycled content of the automotive sheet that Novelis supplies to OEMs [original equipment makers],” says Derek Prichett, senior vice president of Corporate Development at Novelis and head of Novelis Ventures.

Novelis Ventures is the “entrepreneurial arm of Novelis responsible for driving investments and incubating ideas in areas of strategic importance,” according to the company. (See the sidebar below for more information.)

Sortera is a scrap metal sorting and recycling company that was spun out from the Advanced Research Projects Agency – Energy (ARPA-E) project in the U.S. Department of Energy, which seeks to advance high-potential, high-impact energy technologies that are too early for private-sector investment. The company has developed and patented sorting technology that uses artificial intelligence- (AI-) based sensor sorters as well as X-ray fluorescence and laser-induced breakdown spectroscopy to upgrade shredded nonferrous scrap feedstock and remove unwanted contaminants.

Through a processing arrangement with Sortera, Prichett says Novelis will be able to effectively separate mixed automotive scrap from manufacturers into individual alloys and recycle them back into the same product, allowing the aluminum producer to meet automotive OEMs’ needs for performance, durability, safety and design.

“Sortera will build new assets to supply to Novelis,” Prichett says. “At this time, Novelis will not utilize the Sortera technology directly at our own facilities. We will evaluate the possibility of integrating Sortera technology at Novelis sites over time as our partnership grows.”

The partnership supports Novelis’ sustainability goals to reduce its carbon footprint by 30 percent by 2026 and to be carbon neutral by 2050 or sooner. “It also aligns with our goal of becoming a fully circular business, as we will be able to keep more automotive aluminum in our supply chain and redirect it back into the same products,” he says.

Tackling mixed scrap streams

Prichett says the investment in Sortera works on two problems at once. The first is around the recycling of scrap from automotive stamping plants, or preconsumer scrap.

He says the manufacturing scrap that comes back to Novelis from these plants is a mixture of alloys, making it challenging to recycle.

Sortera will be able to separate those mixed alloy streams into individual streams by alloy category, Prichett says, improving recycling efficiency at Novelis’ operations and preserving much of the value of the original material. “We don’t want to see the material being downgraded as it gets recycled. We want to see it go back into the original product, again, which preserves the maximum value for the scrap.”

In the second half of 2022, Sortera will begin sorting stamping plant scrap for Novelis on a toll basis, Prichett says. Sortera will expand by adding sorting lines dedicated to Novelis’ material. “We anticipate that volumes will grow year over year throughout the term of our commercial agreement.”

The second problem that Novelis is working with Sortera on is “an end-of-life problem,” he says, or postconsumer scrap that has been recovered from auto shredding operations and sorted into twitch, a mixed aluminum grade derived from wet or dry media separation that contains no more than 1 percent free zinc, 1 percent free magnesium and 1 percent of analytical iron, per the specification developed by the Institute of Scrap Recycling Industries, Washington. Today, twitch is commonly exported or used within North America to produce aluminum sows and ingots for casting applications.

Prichett says obsolete automotive sheet contained in twitch is getting consumed in aluminum castings presently. However, as wrought aluminum’s use in vehicles increases and the use of aluminum castings declines with the transition to electric vehicles, this wrought scrap will need to be separated from the twitch stream rather than go into the casting industry. He adds, “It’s a matter of balancing inputs and outputs and creating a new stream of scrap that we can recycle in auto ingots and sheet.”

Sortera’s AI technology can separate twitch, which contains a mixture of aluminum alloys in the form of body sheet, extrusions and castings, into those broad categories, Prichett says. The company also can sort the resulting streams further by alloy, enabling Novelis to purchase specific alloys from the rolled aluminum sheet fraction to use to make new aluminum sheet.

He says he expects that Novelis will begin purchasing this sorted postconsumer scrap from Sortera next year.

From lab to startup

Sortera was co-founded by Chief Technology Officer Nalin Kumar and Vice President of Artificial Intelligence and Data Science Manuel Garcia in 2020. The company developed its sorting technology over a number of years using grants from the U.S. Department of Energy, Sortera President and CEO Michael Siemer says.

The final phase of ARPA-E process involved partnering with a company—Kumar and Garcia chose OmniSource, the scrap processing division of Steel Dynamics Inc. (SDI), Fort Wayne. Sortera relocated from Fort Worth, Texas, to Fort Wayne in July of 2020 to develop its 10-acre facility, he says.

Chrysalix Venture Capital, a global venture capital fund headquartered in Vancouver, British Columbia, invested in the company in 2020 through its RoboValley Fund, which invests in intelligent systems enabled by AI, internet of things and sensor technologies. Investors in the fund include metals producers, such as South32, Severstal and Mitsubishi Corp.

Earlier this year, Sortera received $10 million in funding led by Detroit-based Assembly Ventures, with additional funding from Breakthrough Energy Ventures and Novelis. Kirkland, Washington-based Breakthrough previously invested $10 million in Sortera.

Siemer says that while most companies must spend their capital to build demand and acquire customers, “For us, there’s such a shortage of available recycled aluminum that we have virtually unlimited demand. … There’s simply not enough aluminum that’s currently being recycled to meet not only what the world has been promising to do with climate tech but also these expansions like at SDI, Novelis and Rio Tinto.

“We’re going to make more aluminum [in North America], and it’s going to be lower carbon, and we’re going to need more recycled material,” Siemer continues, noting that production scrap is largely spoken for, requiring aluminum producers to learn how to make the most of the twitch available.

He says Sortera can sort this material inexpensively and quickly with high throughput into its three major categories using its AI technology. “And now the alloys that go into extrusions and the families of alloys that go into sheet all of a sudden are more valuable, and so our gross margins go up just by separating the pile of aluminum.”

In its preproduction phase, Sortera is supplying five customers, Siemer adds.

When the company launched, it had planned to license its technology, but its business model changed, says Ben Pope, vice president of commercialization.

“No singular company wants the technology because they’re only focused on the specific portion [of the twitch stream] that adds value for them, such as cast, sheet or extrusion,” he explains.

Also, Pope says of Sortera’s technology, “Because we’re using artificial intelligence and writing our own algorithms … we need to collect that data to optimize the sorting capability.”

Sortera also uses low-frequency X-ray fluorescence technology to further upgrade the sorted fractions from the twitch, he says.

The company plans to have four to five plants operating in North America in the next five years, Pope says, in locations such as the Northeast; the Detroit area; near Nashville, Tennessee; and in the Atlanta area. “We’ll have the ability to produce somewhere to the tune of 150 to 200 million pounds on an annual basis per plant. And the revenue per plant is going to be somewhere to the tune of $130 to $150 million per year.”

Recycling Today archives

Building a deeper relationship

Novelis’ Prichett says, “The fact that we are making equity investment tells you our view of the technology and our interest in the technology. We are thinking about Sortera more strategically than we would with just a simple commercial agreement. So, in this case, the commercial agreement and the equity investment kind of work together and build a deeper relationship with Sortera than we would have with a lot of other suppliers,” he adds.

While he cannot give specifics on the terms of Novelis’ commercial agreement with Sortera, Prichett says “the volumes of material purchased from Sortera will be significant.” The material could be consumed at any current or future Novelis location that recycles automotive aluminum, including its plants in Oswego, New York; Guthrie, Kentucky; and Bay Minette, Alabama.

“Novelis values the innovative technology that has been developed by Sortera, and we believe that their approach will provide a solution to some longstanding issues in the automotive recycling space,” Prichett says.

He continues, “Sortera wanted Novelis to participate as a strategic investor because of our leadership position in automotive aluminum and recycling, plus our significant experience in industrial manufacturing.”

Together, the two companies are hoping to unlock additional value from a substantial material stream.

The author is the editorial director of the Recycling Today Media Group and can be contacted at dtoto@gie.net.