Sustainability report 2012 - Elkem

Sustainability report 2012

Contents
3 Key figures
4 The CEO: Less waste yields better results for everyone
5 Elkem in a nutshell
6 The organisation
8 2012 results affected by demanding markets
9 Corporate Governance
10 Management systems for sustainable operations
11 HR/EBS: Continuous improvement systematised
12 Elkem employees
13 Joint work on improvements in Yongdeng
14 Elkem Technology: More silicon for the same amount of energy
16 Efficient energy management: profitable climate measure
18 Emissions: New projects provide increased sustainability
21 Extensive, research-based work to reduce dust in the workplace
24 Environment, health and safety (EHS): One year without any permanent injuries
26 Elkem Silicon Materials: Large sustainable improvement projects
30 Elkem Carbon: Becoming its own energy supplier
32 Elkem Foundry Products: Major improvements in energy efficiency
34 Elkem Solar: Lower energy consumption and a better utilisation of solar energy
36 The history of Elkem
38 Chairman of the board Robert Lu: Investing in a sustainable future
The front page image is taken at Elkem Carbon’s facility for biological treatment of
contaminated rainwater in Brazil. Read more about it on page 30.
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Elkem’s sustainability report 2012

Key figures
Finance Unit 2012 2011
Revenue MNOK 8 184 9 548
EBIT MNOK -854 616
Annual profit MNOK -680 -142
Assets MNOK 11 607 12 971
Equity ratio Per cent 68 per june 2013 38 per 31.12.2011
Health and safety
Number of employees 2 255 2 349
Sick leave-rate Per cent 3,9 4,0
Number of injuries per
million work hours with
absences H1 1,8 1,0
Energy and external environment Norway Group Norway
Energy recovered* GWh 158 340 340
CO 2 emissions Thousand tonne 870 1 300 739
NO x emissions Tonne 5 125 8 500 6 189
Sulphur emissions (SO 2 ) Tonne 3 233 7 000 3 425
Commitment for future improvements
Investments MNOK 507 750
R&D Man years 100 120
*Low numbers due to modifications both years.
Collaborating for
improvements
Since the autumn of 2011, Elkem
employees from Norway have been
working on improvements at China
National Bluestar’s silicon plant in
Yongdeng in China, in close collaboration
with the Chinese plant management
and the local organisation. The
project is based on the Elkem Business
System (EBS) and has had very good
results.
A battery breakthrough
In 2012 Elkem started delivering
a new quality of silicon for use in
batteries. Silgrain ® e-Si is silicon for
next-generation lithium-ion batteries. A
breakthrough in battery technology will
revolutionise the range of electric cars
and can also be significant for the use
of electric engines in other contexts.
Dust-reducing
measures
New equipment is to reduce the dust
and loss of material, and increase
productivity in Elkem. Finding effective
measures requires a detailed understanding
of how the dust and the material
that produces the dust behave when
moving from extreme temperatures in
the furnaces and going through the
various steps to the finished product.
Elkem’s sustainability report 2012 3

The CEO
Less waste yields better results for everyone
Elkem’s vision is to be among
the world’s leading companies
in environmentally friendly
production of silicon-related
materials.
For us, this is a vision with far-reaching
consequences. Firstly, the products
Elkem has developed and produces
are incorporated into other products in
a way that makes them more environmentally
friendly because they become
lighter, stronger and require less energy.
This includes aluminium for car parts,
concrete for skyscrapers and bridges, as
well as solar panels and windmills. We
make products the world will need in the
years ahead, with population growth and
resource scarcity.
We shall also operate in an increasingly
environmentally friendly manner, and be
a responsible employer and business
partner. Elkem Business System, which
is the core of our organisational culture,
helps us in this work by facilitating for
continuous improvement through the
reduction of all forms of waste. For
example:
• Waste of our employees’ time and
competence
• Waste of fixed capital in the form of
excessive inventory in the value chain
• Waste of energy and materials used in
production
One tool we use is surveying time-use to
find out what is used for value creation
what is not. Time is not only related to
the efficiency among us in management
and our employees, but also how long
inputs await further processing, our
inventories of finished goods and how
we transport inputs and finished goods
around our facilities.
Our industry uses large amounts of
energy and enormous volumes of different
raw materials. It can therefore be all
too easy to be blind to sources of waste
that in comparison may appear small
and insignificant.
Elkem has worked for many years to
develop good technical solutions to
reduce energy consumption and recover
energy from our smelters. An energy
recovery facility was built at Elkem Bjølvefossen
in 1977. In 2012, we decided to
create a dedicated position to focus on
more energy efficient solutions across the
Group. We want to ensure that competencies
in this field are developed throughout
the Group, and that we establish
programmes that utilise the measures
the government has created to stimulate
lower energy consumption in society. This
is important for the environment and it
reduces costs, both for us and for society.
We work in the same way to utilise what
we call «sidestreams», or waste from
the production. These are resources
we are now trying to use, whether in
our own production or by selling them.
Microsilica, which among other things
is used to make concrete stronger and
more weather resistant, was originally
dust emissions from our furnaces. In
the 1970s, technology that captured this
dust in cleaning bags was developed.
Subsequently, we developed a market
for microsilica, which today is a highly
sought-after product.
In 2012, Elkem Foundry, which makes
alloys for the foundry and steel industry,
achieved an eight per cent increase in
productivity without making any investments.
This was done by returning one
of the waste products from the production
(«fines», which are produced when
the product is crushed to the right size)
to the smelter ladle; by increasing the
energy efficiency and by better utilising
the furnaces’ capacities. Every project
does not lead to such good results in
such a short time, but Elkem will become
increasingly sustainable through continuous
improvement.
Through a targeted focus on innovation,
Elkem has developed new and better
products and found new uses for them.
Elkem makes specialist products within
silicon, where high purity is key. Elkem
Solar is a good example. There we have
developed a process to make silicon for
solar panels that is more energy-efficient
and has lower costs than the traditional
production methods.
We emphasise good collaboration with
the authorities in the countries we operate
in. This applies not least to Norway,
where most of our plants are, and where
our research and development activities
are based. Elkem has brought forth many
technological breakthroughs through
our more than 100 years of history, most
recently in the establishment of Elkem
Solar. We work with research institutions
and authorities to produce new research
results, which everyone will benefit from.
Right now, we are working on reducing
NO x emissions from our plants, while
also researching new production processes
with lower dust and CO 2 emissions.
In our type of industry, this is only
possible when combining both operational
competence and research competence.
This means that conditions must
allow us to keep industrial production
where our researchers are, in order to
utilise the expertise we have in this area.
Together with our owners, we are trying
to spread Elkem’s competence to other
parts of the Bluestar family. In this way
the systems we have spent decades
developing into the Elkem Business
System (EBS) can benefit others.
My message is simple: More Elkem is
good for the world!
Helge Aasen
CEO, Elkem AS
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Elkem’s sustainability report 2012

Elkem in brief
Elkem in a nutshell
Elkem is a world-leading
producer of silicon, solar cell
silicon, special alloys for the
foundry industry, carbon and
microsilica. The 2012 turnover
was NOK 8.2 billion. Elkem
has approximately 2,300
employees. Elkem is wholly
owned by China National
Bluestar.
Elkem Solar produces super-pure
silicon to the solar industry, using a
method that requires a quarter of the
energy of its competitors’ manufacturing
processes.
Elkem Foundry Products is the world’s
leading producer of ferrosilicon and ferrosilicon-based
special alloys. Ferrosilicon
improves the characteristics of steel
and is incorporated into windmills, trains,
cars and most other mechanical devices.
Elkem’s special alloys are added to
foundry products and contribute to
increased productivity and reduced
energy use for the customer’s.
Elkem Silicon Materials is one of the
world’s leading suppliers of silicon and
microsilica. Silicon has a large number
of varied applications. Silicon improves
the characteristics of aluminium, acts
as conductor in electronic products, and
chemical processing turns it into silicone.
Microsilica is an extremely fine-grained
silicon dust that is used as an additive
in concrete, as lining in oil wells, as an
asbestos substitute, in refractory materials,
in fertilizers and in plastics. The use
of Elkem’s silicon-related products contributes
to reduced needs for materials
and increased strength in the customer’s
materials
Elkem Carbon is the world’s largest producer
of electrical calcined anthracite and
electrode paste, which are necessary
in the manufacturing process for steel,
aluminium, silicon and other metals.
Elkem Technology contributes to
research and development projects
related to all parts of Elkem’s value
chain. The research strategy is built on
a close connection between the operational
organisation and the researchers.
Elkem in the world
Head office
Chicoutimi, Canada
Dehong, China
Singapore, Singapore
Oslo, Norway
Plants/Production
Kristiansand, Norway
Bremanger, Norway
Thamshavn, Norway
Salten, Norway
Bjølvefossen, Norway
Tana mines, Norway
Grundartangi, Iceland
Shizuishan, China
Carboindustrial, Brazil
Carboderivados, Brazil
Ferroveld Joint Venture,
South-Afrika
Sales offices
Ontario, Canada
Shanghai, China
Tianjin, China
Zagreb, Croatia
Praha, Czech Republic
Vedbæk, Denmark
Sheffield, England
Paris, France
Düsseldorf, Germany
Navi Mumbai, India
Milano, Italy
Tokyo, Japan
Moscow, Russia
Las Arenas-Vizcaya and
Barcelona, Spain
Dubai, the United Arab
Emirates
Pittsburgh, USA
Ho Chi Minh, Vietnam
Sao Paulo, Brazil
Istanbul, Turkey
Rotterdam,
The Netherlands
Elkem’s sustainability report 2012 5

The organisation
Corporate management
Helge Aasen
CEO
Morten Viga
CFO
Katja Lehland
Senior Vice President HR
Inge Grubben-Strømnes
Senior Vice President
Elkem Solar and Business
Development
Håvard I. Moe
Senior Vice President
Elkem Technology
Trond Sæterstad
Senior Vice President
Elkem Silicon Materials
Kjell Ramsdal
Senior Vice President
Corporate Development
Jean Villeneuve
Senior Vice President
Elkem Foundry Products
Asbjørn Søvik
Senior Vice President
Elkem Carbon
Liu He
Senior Vice President
Elkem China
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Elkem’s sustainability report 2012

Board of directors
Robert Lu
CEO
Bluestar, Beijing
Yougen Ge
Assistant to CEO
Bluestar, Beijing
Olivier de Clermont-Tonnerre
Executive Officer Strategy and
Corporate Development
Bluestar Silicones, France
Sverre T. Tysland
Partner and senior lawyer
Selmer DA
Helge Aasen
CEO
Elkem AS
Einar Støfringshaug
Union leader
Elkem Bjølvefossen
Espen Sortevik
Union representative
Elkem Bremanger
Elkem’s sustainability report 2012 7

Economic results
Results affected by demanding markets due
to lower activity in Europe and a continued
overcapacity of silicon for the solar industry
2012 was a year of slow
economic growth and global
economic uncertainty.
The debt crisis in several
European countries resulted
in a lower activity level and
consequently lower demand
and lower prices of Elkem’s
products in the EU. An
overcapacity of solar-grade
silicon was also a factor
throughout the year. Elkem
has worked hard to offset
the negative market effects
by cutting costs. In the long
term, Elkem is well-positioned
in markets that have attractive
forecasts.
In 2012 the revenues in the Elkem
Group were 8,184 million, compared to
9,548 million in 2011. Operating profit
(EBIT) was minus NOK 854 million,
compared with a profit of NOK 616
million in 2011. Profit before tax was
minus NOK 680 million, compared to
minus 142 million in 2011. The 2012
results were negatively impacted by a
write-down of inventory in Elkem Solar
of NOK 222 million and an adjustment
of the value of energy contracts with
Statkraft of NOK 552 million. The writedown
of energy contracts is based on a
significant decline in Norwegian energy
prices, which improves competitiveness
for Elkem’s Norwegian plants in the
future.
The market for silicon for the solar
industry has been particularly difficult.
In 2012, after years of strong growth,
there was for the first time a negative
growth in Europe, particularly in Italy
and Germany. Because of slower
growth outside of Europe there was in
2012 only a slight growth in the overall
demand for solar panels. As a result of
a very large overcapacity of solar-grade
silicon, prices fell in the range of 35 per
cent through 2012.
Elkem Solar halted its production for
large parts of 2012 and delivered about
500 tonnes, against 3,000 tonnes in
2011. The company has not been in full
operation since October 2011. Elkem
Solar has used 2012 to develop its
technology further so that both energy
consumption and production will be further
improved when production is again
taken up to normal levels.
In parallel with the approval of the
annual report for 2012, the Board of
Elkem AS approved a strengthening of
the balance of Elkem AS by converting
a shareholder loan of 4.356 million
into new equity. This has significantly
strengthened Elkem’s financial position,
and its equity ratio is now at 70 per cent.
In 2012, investments of NOK 507 million
were made, compared with NOK 750
million in 2011. 176 million are categorised
as strategic investments and 332
as reinvestments. The strategic investments
are related to energy recovery
systems in Thamshavn and Chicoutimi,
the conversion to a new silicon furnace
in Salten and technology improvements
in Elkem Solar.
Mill NOK
12 000
10 000
8 000
6 000
4 000
2 000
0
Revenues
100 %
80 %
60 %
40 %
20 %
0
Revenues divided by
business area
2008 2009 2010 2011 2012
100 %
80 %
60 %
40 %
20 %
0
Staffing divided by
business area
2008 2009 2010 2011 2012
2008 2009 2010 2011 2012 Elkem Solar Silicon Materials
Elkem Solar Silicon Materials
Foundry
Carbon
Foundry
Carbon
Other/eliminations
Other/eliminations
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Elkem’s sustainability report 2012

Corporate governance
Corporate governance
Orkla sold Elkem to China
National Bluestar Group Co
Ltd (Bluestar) on 14 April
2011. China National
Chemical Corporation owns
80 per cent of CNB, and the
US company Blackstone
owns 20 per cent.
Elkem is governed by its owners
through decisions adopted at the annual
general meeting and by the company
Board. Elkem’s Board meets three to
four times a year. Instructions have
been adopted for the Board, and these
govern the Board’s responsibilities and
the CEO’s relationship to the Board.
The Board is to ensure the sound
organisation of the company’s activities,
adopt plans and budgets, supervise
the general management, and ensure
that the company’s activities, accounts
and asset management are subject to
proper scrutiny. The instructions are
based on the provisions of the Limited
Liability Companies Act.
Little hierarchy
The Board consists of seven members,
of which five are elected by the
owners and two are elected by the
employees. Elkem’s CEO Helge Aasen
sits on the Board as a representative
elected by the owners. Aasen also sits
on Bluestar’s Board. Elkem has had
employee representatives on its board
since 1974, and has been pushing for
the introduction of corporate democracy
in Norway. Since the 1990s, the
relationship between management and
other employees has been characterised
by little hierarchy and an extensive
decentralisation of responsibility to each
employee.
Elkem Business System
Business activities are reviewed monthly
at the corporate management level. A
template has been developed for what
is to be reviewed and discussed during
the monthly reviews. Elkem Business
System (EBS) is the company’s own
tool for achieving goals and ensuring
continuous improvement at all levels of
the company. This applies particularly to
the operative level. EBS has been developed
by Elkem, and is also influenced
by Alcoa Business System, a company
that Elkem has collaborated with closely
for a long time.
Regularly updated risk
assessments
Risk assessments are conducted at
all levels: by the Board, corporate
management and by all business units.
Risk assessments include all aspects
of Elkem’s business activities. Policies
and procedures have been prepared
for all business areas: financial risk,
market risk (price and volumes) and
operational risk. The risk situation is
updated regularly and measures are
decided on and implemented as soon
as possible and at the responsible level.
The company has its own Risk Manager
who is responsible for monitoring risk
management in the company. The
Board and management are regularly
updated on the risk situation.
A detailed authorisation structure
A detailed authorisation structure has
been developed that regulates who can
make what decisions at various levels
of the company. This includes specific
rules for when decisions are to be
moved up in the system, with the Board
being the uppermost level for businessrelated
decisions.
Elkem’s sustainability report 2012 9

Corporate governance
Management systems for sustainable
operations
Elkem’s vision is to be among
the world’s leading companies in
environment-friendly production of
silicon-related materials.
Elkem’s values are continuous improvement,
precision, respect, involvement.
Elkem’s overall policy states that
Elkem will conduct its business with a
strong focus on health, safety and the
environment, society, our employees
and our customers.
The Elkem Business System (EBS) is
a set of principles, methods and tools
that describe how the organisation
works to reach its goals and to achieve
continuous improvements. Eliminating
waste is an important EBS principle.
Amongst other things, this is done by
ensuring the maximum utilisation of raw
materials and energy.
Elkem’s internal control system
ensures that conditions in the workplace
that can affect employees’ health and
safety or negatively affect the external
environment are kept within the frameworks
stipulated in state laws, rules and
licences, and in Elkem’s policy.
‘Focus’ is Elkem’s programme for
environment, health and safety in the
workplace. Elkem has a vision of zero
injuries and occupational illnesses, and
works systematically to achieve this
vision. Reports are prepared for each
business area every month. The reports
include an overview of undesired
incidents and near-accidents as well as
lessons to prevent similar incidents in
future.
Elkem’s risk management instructions
emphasises all types of risk that
can affect the business. The purpose
of instruction is to ensure a systematic
approach to risk management within
Elkem. Risk management shall ensure
that risks that are significant to Elkem’s
goals are surveyed, analysed and
handled at as early a stage as possible
and in a systematic and cost-efficient
manner. Elkem’s experience indicates
that investment in proactive risk-reducing
measures carries significantly lower
costs than reacting retroactively.
Elkem’s guidelines for maintaining
Elkem’s social responsibility
describes the overarching requirements
related to the organisation of the
work on social responsibility, areas of
responsibility within the organisation
and routines for ensuring compliance
with the basic principles described in
‘Principles for social responsibility’. The
principles provide an overview of what
Elkem emphasises in connection with
safeguarding basic human rights, the
employees’ rights as workers, environmental
concerns, a sustainable exploitation
of natural resources and business
integrity.
Elkem’s supplier requirements
impose requirements on risk-exposed
suppliers regarding human rights and
responsible environmental management.
Elkem’s standard procurement
contracts refer to Elkem’s principles for
social responsibility as a requirement
for signing contracts. Elkem provides
training and implements supplier audits,
and continuously work with ensuring full
compliance throughout the value chain
for bulk goods on the world market.
Elkem’s ethical guidelines apply to
all Elkem employees. The guidelines
include topics such as each employee’s
responsibility for ensuring that Elkem
maintains a high EHS standard, for
ensuring that discrimination and harassment
do not occur, for the prohibition on
corrupt actions, for the management of
confidential information, for compliance
with competition rules and for accuracy
in public reporting. A basic principle is
that all employees shall comply with and
respect laws wherever they are.
Elkem does not contribute to political
parties.
Elkem has created an internal
notification service that employees
can use to note their concerns about
possible breaches of Elkem’s ethical
guidelines or other possible unethical or
illegal actions.
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Elkem’s sustainability report 2012

HR/EBS
Continuous improvement systematised
Elkem Business System
(EBS) is a set of principles,
methods and tools that
describes how employees at
all levels are to behave, and
how the organisation is to
collaborate to reach common
goals and achieve continuous
improvements. EBS is the
foundation of Elkem’s operational
philosophy.
Since 2012, one of the main elements
of Elkem’s HR strategy has been to
develop the HR (human resources)
function from being a supplier of human
resource administration to being a
contributor to the development the
organisation with the goal of increasing
the rate of improvement in all units. HR
is to have ownership of and support the
development of improvement competencies
in the company.
The HR strategy is based on four
elements:
• Support Elkem’s business strategy
• Facilitate change in society and the
labour market
• Ensure that the organisation actively
uses the Elkem Business System
(EBS)
• The work is to be based on Elkem’s
values: Respect, Precision, Involvement,
Continuous Improvement
Elkem is in a demanding market in
which there is a great need for continuous
improvement. The most important
task for the HR function is to ensure that
Elkem employees have the necessary
competence, so that improvements
occur in the right manner and at a
sufficient pace.
Elkem management are strong supporters
of EBS. The work on improvements
is also supported by local EBS coaches
in addition to Elkem’s central EBS
centre, which functions as a competence
centre and support for Elkem’s
plants. The goal is to jointly ensure
that the plants are undergoing continuous
organisational development that
improves the competitiveness of the
plant and of Elkem.
Individual responsibility
One of the main EBS principles is that
people are the driving force. Each Elkem
employee is therefore given responsibility
for making suggestions about how
the processes they are involved with can
be improved. To ensure that all improvement
suggestions are heard, seriously
considered and possibly implemented,
Elkem’s operations are organised in
teams focused on active and continuous
improvement at all levels.
Competence development is important
to ensure continuous improvement, as it
is competent employees who see potential
for improvement, identify problems,
find solutions and implement them. The
HR function is responsible for Elkem
having good and correctly adapted
learning arenas available, especially in
the work situation but also in courses
and training (internal and external).
Management responsibility
A central principle of EBS is that managers
must have in-depth knowledge of
the production processes. Elkem’s managers
are therefore often and regularly
present in the production facilities to see
for themselves what is happening, talk
with employees about the production
flow and any challenges, and
to listen to suggestions for
improvements. Giving direct,
concrete feedback on how each
employee performs their tasks
is an important management
task in Elkem. A systematic
coaching and mentoring
scheme provides a basis
for a professional and
personal development
of Elkem employees.
The four main principles of the
Elkem Business System:
1. To produce according to the
customer’s needs
The focus is always on the customer’s
needs. This is also the case within
Elkem, in which everyone in the organisation
is seen as interlinked as suppliers
and customers in a value chain.
2. Empowered people
Elkem ascribes 70 per cent of its success
to human effort, and 30 per cent
to the underlying system. Those who
carry out the tasks are the experts, and
together they form Elkem’s resource
base.
3. To eliminate waste
This principle is at the core of Elkem’s
goal of continuous improvement. There
are three main categories of waste:
Overloading, uneven production and
work that does not add value.
4. To have control of all processes
All production processes shall be stable
and predictable, and variations shall be
avoided.
Elkem’s sustainability report 2012 11

HR/EBS
Salten Verk captures ideas
Elkem Salten’s operators gather
regularly in the plant’s improvement
room to discuss improvements. Every
week, participants meet from two of
the ten improvement teams that are
always working to review the progress
of the improvement projects they help
implement. The ideas for the improvement
projects come from the operators
themselves. The teams are put together
for each case, and operators who have
completed the EBS team leader school
can lead the improvement work. The HR
Manager at the plant follows up on the
work on improvement, in collaboration
with the EBS coach and the managers
of affected units. All projects must have
a clear goal of resulting in improvements
related to EHS, quality, costs or
time use. Every six months, the plant
announces a winner from amongst the
improvement projects, and each member
of the team gets a gift certificate.
Since 2011, eight operators have completed
the EBS team leader school, and
57 operators have participated in one
or more projects. Measured in kroner,
these improvement projects have given
a total profit of more than NOK
15 million.
The plant also has other arenas for work
on improvements, including an analysis
team in which the plant’s metallurgists
and process engineers meet, and several
process teams for engineers and
operators. Plant management follows
the progress and results of the improvement
work in the three arenas.
Elkem employees
At the end of 2012, Elkem had 2,318
employees. Of these, 1,200 worked as
operators at Elkem’s production facilities
in Norway, Canada, Brazil, China and
Iceland. Elkem has sales offices in a
number of countries, and approximately
200 of its employees worked in sales
at year-end 2012. Elkem’s combined
R&D staff at the Group and divisional
levels comprises approximately 180
employees. Elkem is headquartered in
Oslo, and this is also where the central
administrative functions are located.
Elkem sees the Norwegian apprentice
scheme as a good way to secure
competent workers in the future. In total,
45 apprentices (7 of whom are girls) are
currently training at Elkem’s plants.
Equality
The process industry is generally maledominated,
and few women pursue
careers in the industry. Nineteen per
cent of Elkem employees are women.
The percentage of women employees
has increased in recent years, but the
percentage of female operators remains
low. Elkem wants to achieve a greater
gender balance among its employees,
and is therefore focused on having
approximately 50 per cent of Elkem
trainees be women. Thirty per cent of
Elkem management are women.
Mutual respect
Elkem is a traditional international
company, with Chinese owners and
production and sales offices in many
countries. Being closed to the markets
and having good collaborations across
geographic, cultural and individual
differences are necessary for the
company to reach its goals. Elkem’s
corporate culture is based on values
of respect, involvement, precision
and continuous improvement. Elkem
is convinced that a high degree of
involvement by employees, who are
considered experts in their fields, is
necessary to find the best solutions
to challenges. Being established in
several countries and having employees
with diverse backgrounds is therefore
an obvious strength for the company.
Elkem’s internal recruitment regulations
and Elkem’s ethical guidelines for
employee behaviour prohibit all forms of
discrimination.
Corporate democracy
In its more than one hundred year
history, Elkem has been through
many major reorganisations. The
international market Elkem operates
in is highly competitive and sensitive
to economic developments, and the
need for restructuring and layoffs
is a constant challenge. Excellent
collaboration between employees and
management is a prerequisite for Elkem
surviving the at times challenging
market conditions. Therefore, there
are long-standing traditions of good
collaboration between employees and
management in Elkem. In Norway, all
Elkem plants and other units have local
unions, both for operators and clerical
staff. Outside Norway, Elkem complies
with local statutory requirements and
values good collaborations with, and the
extensive involvement of, employees.
At the Group level in Norway, five
formal committees have been created
for contact between the company and
employee representatives. Pursuant to
the provisions of the Companies Act,
employees have two representatives
and two observers on the board of
Elkem AS.
12
Elkem’s sustainability report 2012

Joint work on improvements in Yongdeng
Since the autumn of 2011,
Elkem employees from
Norway have been working
on improvements at Bluestar’s
silicon plant in Yongdeng in
China, in close collaboration
with the Chinese plant
management and the local
organisation. The project is
based on the Elkem Business
System (EBS) and has had
very good results.
In 2008, the CEO of Elkem Silicon
Materials visited the Bluestar plant
in Yongdeng for the first time. Elkem
purchased microsilica from the plant,
which at the time was characterised by
disorder and a poor resource utilisation.
This was reflected in poor results for
operations and economics, EHS and
the external environment.
In 2011, Bluestar acquired Elkem from
Orkla, and one of Bluestar’s wishes
was to transfer to the Yongdeng plant
Elkem’s operation method for silicon
production, which Elkem had developed
over several years. The improvement
project started in autumn 2011 and was
headed by a former plant manager at
Elkem Bremanger. The improvement
project includes different areas such as
EHS, maintenance, technical conditions,
raw materials, metallurgy, and the
Elkem Technology, here
represented by Aasgeir
Valderhaug, is an active contributor
and has been central
to the implementation of the
improvement processes at
the Yongdeng plant.
Elkem Business System. A number of
Elkem employees work in various subsidiary
projects, either permanently or
during longer stays. Elkem Technology
is an active contributor and has been
central to the implementation of the
improvement processes at the plant.
Good results
The results of the Yongdeng project are
very good. Today, order and cleanliness
are just as good as at Elkem’s own
plants. There are almost no inputs that
cannot be used, or finished goods that
are not of the desired quality in the area.
The operation of the furnaces is under
control and energy consumption is significantly
lower than before. A number
of practical measures have been implemented
to improve employee safety:
consistent use of protective equipment,
pavements to separate persons and
vehicles, guardrails in staircases, and
the securing of transport belts are just
some examples. In 2012, there were
seven injuries that lead to absences. In
the first five months of 2013, there have
been no injuries leading to absences.
With regard to the furnaces, a number
of specific measures have been implemented
that are now giving good results
in the form of stable operations, higher
production, fewer errors and lower
energy consumption.
1050
1000
950
900
850
800
750
700
650
600
Production of approved quality
Increasing production
jan.-16
feb.-16
march-16
apr.-16
may-16
juni-16
july-16
aug.-16
sept.-16
okt.-16
nov.-16
95
90
85
80
75
70
jan.-16
feb.-16
Better process management
march-16
apr.-16
may-16
juni-16
july-16
aug.-16
sept.-16
okt.-16
nov.-16
Share of products with approved quality in percentage of total production
Elkem’s sustainability report 2012 13

Elkem Technology
More silicon for the same amount of energy
Elkem’s «Si2020» research
project has been funded
by the Research Council of
Norway to develop a completely
new way of managing
chemical reactions, material
streams and temperatures in
the smelters. A safer, more
energy-efficient production
process for silicon is under
development.
Continuous improvement is the essence
of Elkem’s operational philosophy.
Elkem Technology’s task is to conduct
long-term research and development
projects focused on the environment,
health and safety (EHS), product quality
and efficient operations. Suggestions
for the research projects are directed
by operational needs, customer needs
and by the framework conditions set by
the authorities. The research results are
implemented in operations as soon as
they are mature and are practically and
financially implementable.
In 2012, Elkem’s combined R&D staff
at the Group and divisional levels
comprised approximately 180 employees.
Of these, 10 per cent are trained
at the doctoral level, and 35 per cent
have master’s degrees or are civil
engineers. Fifty per cent of research
staff is involved in product-related R&D.
Elkem’s Technology division has 120
employees, while the rest of the staff
is employed in the research units. A
large percentage of the researchers are
located in Kristiansand, where Elkem
has established a laboratory and test
facility.
Improved silicon process
Si2020 is a project that is to improve
the entire production process for silicon,
from the input of raw materials and
energy to casting and the finished product.
It has a large identified potential
and will both strengthen Elkem’s competitiveness
significantly and improve
the production’s EHS standard. In 2012
and 2013, research began in the following
areas:
1. Improved understanding of the actual
furnace process and the development
of new raw materials
2. Monitoring of the furnace surface and
the addition of raw materials
3. Refining
4. Thin casting of the finished product
Points 1 and 2 have been separated into
a project called ESiP (Energy Efficient
Silicon Production). The project has
received funding from the Research
Council of Norway for the 2013-2016
period. Silicon is extracted from quartz.
With current silicon production methods,
we are typically left with 80 per cent
of the silicon that can be found in the
quartz as a product. Twenty per cent
of the silicon disappears in the furnace
during the process, as a gas consisting
of silicon and oxygen. Most of this is
captured as microsilica in the filter bags
in the chimneys. The goal of the ESiP
research project is to increase utilisation
of the raw material to 85 per cent
produced silicon, without increasing
energy consumption. By managing the
production processes better, Elkem can
achieve energy savings of 200 GWh,
if the method can be implemented
throughout the Group.
This is founded on knowledge developed
throughout more than 100 years.
We must first understand how the different
chemical processes behave under
different conditions, and then develop
14
Elkem’s sustainability report 2012

a way of monitoring and managing
the process. This is about both basic
research and the utilisation of technology
from other industries. In addition to
Elkem’s own researchers, the best qualified
research community in this field
(from SINTEF and NTNU) are involved
in the project.
To establish knowledge about what
is happening, Elkem has filmed the
surface of the mass inside the furnaces.
Because the surface temperature in a
silicon furnace is typically about 1,000
degrees Celsius, this is in itself a complicated
task. The information from this
shooting will be used to develop a software
programme that simulates what
happens in the furnace. The programme
will be used to manage the composition
of the raw materials (quartz, coal/coke
and wood chips) and how the feeding of
the furnaces should be done to get the
best production possible.
Because the furnaces are so hot, it
associated with risk for both people
and equipment to get too close. Today,
the feeding process is managed by an
operator who observes the process
from a distance and via indirect process
measurements, but no one can see
what happens at the top of the furnaces.
By automating the feeding process, we
will increase safety for our employees
and improve energy utilisation per tonne
of silicon.
The Si2020 research project covers the
entire process, from raw materials to
the finished product. An important part
of the project is to develop methods to
ensure that Elkem produces silicon with
the most consistent quality possible.
The customer shall know with a high
degree of certainty of what trace materials
and impurities are present in the
silicon they receive. Higher quality gives
higher prices, and a high quality is also
important because it reduces wastage
for the customer.
Elkem’s development work also includes
EHS-related issues, and Elkem has
amongst other things completed significant
improvements in electrical safety.
We are also undertaking extensive work
to reduce the emission of NOx and
dust. These projects are discussed in
separate articles in this report.
Elkem’s R&D work
Elkem University
An important area of responsibility for
Elkem’s Technology division is to ensure
that the knowledge we produce reaches
everyone in Elkem who needs it. An
important measure in this regard is an
annual week-long gathering in which 50
participants from the operational organisation
from all across the world are updated
on the latest relevant research. In 2012,
the topic for this gathering was process
understanding. The lecturers include our
own experts and professors from different
universities and university colleges.
Elkem Technology organises several
smaller seminars in addition to Elkem
University, such as process seminars for
furnace metallurgists , team meetings
within chemical analysis, and professional
seminars for project management.
Elkem’s sustainability report 2012 15

Energy efficiency
Efficient energy management:
profitable climate measure
More efficient energy use is a
frequent topic for systematic
improvements at all of
Elkem’s plants.
Elkem has several ongoing processes
that aim to significantly reduce net
energy consumption. In 2012, Elkem
created a dedicated position responsible
for efficient energy management
throughout the Group. The business
areas are responsible for the implementation
of the processes and projects.
Better energy efficiency is to be
achieved in multiple ways:
Energy control. Identify all processes
that use energy and find ways to reduce
the energy consumption.
Increased productivity. Improve production
processes so that energy consumption
per unit produced is reduced.
Waste heat. Use the energy (heat)
that remains after the actual production
process has been completed.
The three methods all have the same
end result: lower consumption of
electrical power. By reducing its energy
consumption, Elkem contributes to
replacing electricity from fossil fuel with
Norwegian hydropower in Europe. This
means that effective energy management
is effective climate work.
Energy control. Elkem has decided
that all plants must introduce an energy
control system. Applications for funding
from Enova will be submitted for the
An important project in 2012
is Elkem Solar’s improvement
of the technology they use for
the production of super-pure
silicon for the solar panel
industry. Elkem already has
a process that only uses
25 per cent of the energy of
competing manufacturing
processes. In 2012, further
improvement opportunities
have been identified in the
process, which will improve
energy efficiency by another
ten per cent.
Norwegian plants. The energy control
system must comply with ISO 50001
and Enova’s framework programme for
the introduction of energy management.
Small measures such as better insulation;
engine control and light control;
and sealing leaks in compressed air
systems, heating and cooling, could
provide significant savings, even though
each individual measure is relatively
small compared with the power consumption
in a furnace. A savings
potential of ten per cent of the electricity
not going to the smelters has been
identified. For the Norwegian plants,
this entails 30 GWh a year in energy
saved. This is equivalent to the electricity
consumption of 2,000 homes.
Increased productivity. This area is
about identifying new ways of utilising
the resources: people, furnaces,
machinery, logistics and waste products,
so that the value creation per consumed
unit of energy is as high as possible.
Great effects can be achieved here.
Elkem’s foundry division is one example
of this. There, better utilisation of the
furnaces and recycling of the fines contributed
to a five per cent improvement
in energy efficiency from 2011 to 2012.
Another important project in 2012 is
Elkem Solar’s improvement of the
technology they use for the production
of super-pure silicon for the solar panel
industry. Elkem already has a process
that only uses 25 per cent of the energy
of competing manufacturing processes.
In 2012, further improvement opportunities
have been identified in the process,
which will improve energy efficiency by
another ten per cent. Several projects
are underway that will lead to new
significant energy efficiency improvements,
and thus make solar cells even
more efficient as a contribution to the
world’s need for climate-friendly energy
solutions.
Waste heat. Elkem is already a pioneer
in the utilisation of waste heat. At
Elkem Thamshavn, electricity produced
16
Elkem’s sustainability report 2012

using waste heat was expanded from
90 to 165 GWh in 2012. At Elkem
Bjølvefossen, more than 200 GWh of
electricity is recovered, while Elkem
Chicoutimi supplies 210 GWh steam.
The Chicoutimi plant started in June
2013. Waste heat can in principle be
used in two ways: direct utilisation of the
heat from the furnace, or converting the
heat to electric power. When waste heat
is converted into electricity, two-thirds
of the energy is lost. It is therefore best
to use the heat directly, either in other
parts of the production or to heat buildings,
football fields, pavements, etc. In
practice, many smelters are located far
away from other buildings or industry,
so it is difficult to utilise the heat well. In
other cases, investments have already
been made in district heating facilities
that supply hot water for external or
internal use.
Elkem Carbon
Enova has granted Elkem Carbon in
Kristiansand NOK 39 million to support
a project that will recover 34 GWh
a year. Heat from the furnaces that
calcinate (heat treat) anthracite (coal)
creates a lot of heat. In the project, the
hot gas from the furnaces will be led
through a heat exchanger and heat up
oil. The hot oil will be used to keep pitch
hot; Elkem Carbon uses pitch in the
production of electrode paste, among
other things. Today, a lot of energy is
used for this purpose. In this way, waste
heat from one part of Elkem Carbon’s
production will be used to lower electricity
consumption in another part of the
production.
In addition, the hot oil goes in a big loop,
and will also be used to dry the anthracite
before the calcination process, so
that less energy is required to remove
moisture in the furnaces. Silos will be
built to store anthracite, which makes it
possible to dry it and prevents precipitation
from adding more moisture to the
anthracite.
The plan is for the heat from the calcination
furnaces to also be used to replace
electricity and oil as sources of heat for
offices and other buildings in Elkem’s
industrial area at Fiskaa in Kristiansand.
Elkem Salten
In 2012, Enova gave a NOK 350 million
grant to support the construction of an
energy recovery facility at Elkem Salten.
The system will produce 300 GWh of
electricity a year. This is equivalent to
a large Norwegian hydropower project,
and it will be the largest electricity
recovery facility in Norway. It will also be
the largest recovery facility in the world
for this type of industry. Technically, it is
a very challenging project, and it is also
subject to a number of uncertain factors
that are of great financial significance.
An investment decision is expected in
2013.
Elkem Bjølvefossen
At Elkem Bjølvefossen, an expansion of
the existing energy recovery facility is
planned, which would increase energy
recovery from 34 GWh to 75 GWh a
year. Elkem expects to send an application
to Enova in 2013.
Elkem Bremanger
At Elkem Bremanger, work is being
done on projects for steam production
that can either be used in the process
or for a recovery facility of the same
size as that at Elkem Thamshavn.
The project is in an early stage.
Financial uncertainty
The price of electricity has fluctuated
widely in recent years. Lower industrial
production in Europe and a fast
expansion of renewable energy has
led to lower electricity prices and lower
prices for CO 2 quotas. Lower electricity
and CO 2 quota prices make recovery
facilities for energy production less
profitable, while it also strengthens
the plants’ overall finances and thus
reduce uncertainty related to the plants’
life span. The latter is crucial for the
profitability of a recovery facility.
Enova
Good state
supporter
Enova is a state agency tasked with
promoting environmentally friendly
changes in energy consumption in
Norway. An important part of this
is to promote energy efficiency in
industry. In 2009, a new study was
done of the potential for energy
efficiencies in Norwegian, land-based
industry, and this uncovered a
technical potential of 26.9 TWh.
It was also pointed out that there are
five barriers that prevent industry
from realising these:
1. Lack of external infrastructure
2. Immature technology
3. Not commercially attractive
4. Limited access to capital
5. Lack of awareness and
competence
Enova has developed programmes
to help industry break through
all five of these barriers. In 2012,
Elkem received NOK 389 million
in commitments of investment
subsidies from Enova.
Elkem’s sustainability report 2012 17

Emissions
New projects provide increased sustainability
Several new projects from
2012 will strengthen Elkem’s
sustainability results:
• A new corporate function has been
created that has responsibility for
energy use in the Group
• New ways of operating the silicon
furnaces combined with larger reconstructions
are expected to lead to significant
reductions in NO x emissions
• In 2012, Elkem delivered a new type
of special silicon for use in batteries.
This silicon can enable dramatic
improvements in battery capacity,
which is highly significant for the
usability of electric cars, for instance.
Elkem produces and continuously
researches materials and processes
that will contribute to a reduced footprint.
Developing better products, energy-saving
processes and increased energy
recovery are important parts of the
company’s efforts. Elkem’s overarching
goals are customer satisfaction, continuous
improvement and growth through
safe, productive and socially responsible
In 2012, Alf Tore Haug
entered into a newly
established position in
Elkem. His responsibility is
effective energy management
throughout the Group. Here
at an energy conference
in Duisburg organised by
Energy Efficiency in Industrial
Processes (EEIP).
value chains. Elkem’s overarching goals
entail a strong focus on health, environment
and safety, society, employees and
customers.
The goals are reached through active
use of the Elkem Business System
(EBS). Eliminating waste is a main principle
in EBS. Research and technology
development tied to better utilisation of
side streams and energy are therefore
very important in Elkem. The ways that
results will affect health, environment
and safety (EHS), quality, time use and
costs must always be assessed prior to
the implementation of changes.
Elkem researches and actively contributes
to research in a number of areas
that will lead to significant reductions
in climate gas emissions globally.
Measures to reduce negative impacts
do not only involve reducing emissions.
They also focus on improved exploitation
of resources, improved production
processes and the development of new
products that provide benefits far beyond
Elkem’s production facilities.
CO 2 is part of the equation
Silicon is extracted from quartz, and is
the second most common basic element
in the earth’s crust (after oxygen). Quartz
consists of silicon and oxygen. To create
silicon and ferrosilicon from quartz,
reducing agents such as coal, coke and
woodchips are added. When a powerful
electric current is added to the mixture,
a process starts in the smelter in which
silicon and CO 2 gas is created. The
oxygen binds to the carbon and forms
CO 2 , and silicon can be tapped from the
smelter. With the current process it is not
possible to avoid the forming of in the
reduction process. As part of the reduction
process, harmful substances such
as nitrogen oxides (NO x ), sulphur dioxide
(SO 2 ) and dust are also created.
CO 2
In 2012, CO 2 emissions from Elkem’s
Norwegian operations were 870,485
tonnes, against 739,000 tonnes in 2011.
The CO 2 increase is mainly a result of
increased production volumes in 2012
due to reconstruction and consequent
idleness of a furnace in Thamshavn
in 2011. The 2012 emissions represented
2.0 per cent of total emissions
in Norway, and 7.8 per cent of industrial
CO 2 emissions in 2012. Industrial CO 2
emissions have been stable since 1990,
while industry’s emissions of other
climate gasses have fallen dramatically.
Total climate gas emissions from industry
in Norway have decreased by 38 per
cent in the same period, according to
Statistics Norway. The Group’s combined
CO 2 emissions were in the range of 1.3
million tonnes.
Though CO 2 emissions cannot be
avoided in the production of silicon,
Elkem works systematically on measures
to reduce the emissions. The first
important measure is to run the furnaces
optimally. Another important measure is
to recover heat from the manufacturing
process. A third measure is to find profitable
ways of using the CO 2 gas to grow
biomass such as algae.
Elkem has several ongoing processes
that in time will reduce net energy use
18
Elkem’s sustainability report 2012

significantly. In 2012, Elkem created a
dedicated position responsible for coordinating
measures for energy efficiency
throughout the Group. The business
areas are responsible for implementing
the processes and projects. Better
energy efficiency can be achieved in several
ways: Better energy management of
different types of consumption, increased
productivity and the utilisation of waste
heat from the smelters. For more on this,
see article on energy recovery.
In addition to the measures to reduce its
own CO 2 emissions, Elkem also contributes
to reducing global CO 2 emissions
through many of its products. One example
of this is an entirely new product
Elkem started selling in 2012. Silgrain ®
e-Si is silicon for next-generation lithium-ion
batteries. The anodes in batteries
are currently made from lithium and
graphite. Using silicon, the capacity can
in theory be increased ten-fold, though
the initial goal is to double it. The product
has been developed together with the
Japanese research centre AIST, Kansai.
A breakthrough in battery technology will
revolutionise the range of electric cars
and can also be significant for the use of
electric engines in other contexts. Electric
engines are much more energy efficient
than combustion engines, in addition to
having the advantage of there being no
emissions from the actual engine.
NOx
Elkem’s 2012 consolidated NO x emissions
in Norway were 5,125 tonnes,
against 6,189 tonnes in 2011, which
represents 3.0 per cent of Norwegian
emissions in 2012. The reduction is
partly a result of furnace 1 at Elkem
Salten not being in operation for much
of 2012 and that the plant had a higher
proportion of FeSi than Si production
this year. The NO x issues primarily relate
to poor air quality in large cities due to
NO x emissions from vehicles, and thus
are not significantly impacted by Elkem’s
emissions, which mainly originate from
plants in rural areas. Nevertheless, there
is heavy emphasis on reducing NO x
emissions from Elkem’s production, as
it contributes to local acidification and
eutrophication. The 2012 consolidated
Group emissions of NO x were in the
range of 8,500 tonnes.
NOx measurements have been conducted
in the silicon and ferro industry
since 1995. Newer measurements,
in combination with theoretical work
performed by NTNU and SINTEF
among others, have given Elkem more
knowledge about how NO x is formed in
the production processes. The results of
this work have been incorporated into
models that show the effect of different
parameters and are actively used in the
development of measures to reduce the
generation and emission of NO x .
Based on this work, several measures
have been found to contribute to a
reduction of NO x during the production
of silicon and ferrosilicon. One of these
is the design of the actual furnace hood
and furnace stack outlet where off-gas
is burnt and transported away from
the furnace. The aim is to prevent local
temperature increases that form NO x .
Another measure is to change the way
the raw materials for the furnace are
added. Additionally, this measure affects
the actual combustion process to reduce
the generation of NO x .
A new NOx-reducing design is being
tested at Elkem Salten in 2013. The
reconstruction costs about NOK 74 million
and is supported by the NO x fund.
Assuming that we achieve an emission
reduction, we can expect further reconstructions
for several hundred million
kroner in Elkem in the coming years.
Sulphur
In 2012, Elkem’s total SO 2 emissions
in Norway were 3,233 tonnes, against
3,425 tonnes in 2011, which represents
18 per cent of Norwegian SO 2 emissions
in 2012. Measures to reduce industrial
SO 2 emissions in Norway are coordinated
by Miljøfondet, which is jointly
funded by Norwegian industrial companies.
The cleaning of SO 2 from Elkem’s
smelters has thus far not been a priority,
as this measure is seen as more energy
and cost intensive than the cleaning of
other processes. Cleaning SO 2 from one
of Elkem’s other main processes – the
calcination of different types of coal – is
on the fund’s list of priorities. In connection
with the installation of the recycling
system at Elkem Carbon in Kristiansand,
we will also be installing a cleaning
system for SO 2 . The Group’s total emissions
of SO 2 were in the range of 7,000
tonnes in 2012.
From waste to resource
Elkem has a long history of research on
exploiting side streams and by-products
that previously ended up as emissions or
were sent to landfills. When something
that initially is considered as waste can
be transformed into attractive products,
we achieve both increased resource
efficiency and less impact on the environment.
The best example of this is
how Elkem in the late 1960s and early
1970s learnt to clean the dust from the
smelters and then developed the Elkem
Microsilica ® material that has a number
of important uses.
In 2012, Elkem Foundry started to use
the leftovers from the crushing process
of ferrosilicon («fines») and added it
to the smelting ladle without having to
add more energy. Energy utilisation
increased by two per cent, and resource
utilisation improved concurrently.
Trade in CO 2 quotas
In 2012 Elkem was not covered by
EU’s CO 2 emissions trading scheme,
but we have participated in the agreement
that has been entered between
the Federation of Norwegian Industries
and the Ministry of the Environment
about voluntary reductions of climate
gasses. From 2013, the EU emissions
trading scheme (ETS) will apply to most
of Elkem’s facilities in Norway. Due to
a delay in the final allocation of quotas
from the EU Commission, trade in quotas
for the part of the process industry
that were to join EU’s quota trading
system in 2013 had not started when
this report was being finalised.
A preliminary allocation of free quotas
was made in collaboration with KLIF
(Ministry of the Environment from July
2013). This resulted in an allocation that
covers about 88 per cent of Elkem’s
needs.
In 2011, Elkem created a project that
aims to ensure that the plants are well
equipped to meet the new requirements
that the trading scheme stipulates. The
project is now working to coordinate all
trade with emissions quotas to ensure
a cost-efficient cover and to establish
a uniform reporting of emissions. From
2013, the CO 2 emissions quotas will
when relevant also be included in the
calculation of all investments.
Elkem’s sustainability report 2012 19

Emissions
Energy efficiency and cleaning measures in Elkem
Problem Measure Where The solution results in
Silicon dust polluted the
surroundings of the plants
Dust collection in cleaning
systems attached to silicon
and ferrosilicon furnaces
All silicon and ferrosilicon
plants
Microsilica
Unnecessary electricity
consumption
Unused heat energy
CO 2
Energy recovery facilities Elkem Chicoutimi
Elkem Thamshavn
Elkem Bjølvefossen
Elkem Salten
Steam for sale
Electricity
Heat energy
CO 2 reduction
Elkem Carbon Fiskaa
Unnecessary electricity
consumption to operate
plants, except furnaces
Energy efficiency measures All plants Lower electricity
consumption
Unnecessary electricity
consumption for furnace
operations
Optimal furnace operations
All plants
Elkem Technology
Lower electricity consumption
Improved resource utilisation
Poor resource utilisation
NOx reductions
NO x emissions
Dust pollution in the
workplace
New technical equipment,
new production methods
and better extraction
Elkem Carbon
Elkem Silicon Materials
Improved EHS results
NO x emissions
Ongoing testing and research:
New feeding method,
new furnace design
Elkem Salten conducts
tests
Reduced NO x emissions
SO 2 emissions
Heat recovery system
lowers gas temperature
and enables SO 2 capture
and cleaning
Elkem Carbon Fiskaa
Eliminates SO 2 emissions
Ground runoff of pollutants
Biological cleaning of
polluted rain water at plants
in tropical climates
Elkem Carbon, Brazil
Clean water
CO 2 emissions
Research project: Algae Elkem Technology Reduced CO 2 emissions
«fed» with CO 2
Algae as biomass to use as
fuel, fish feed, etc.
20
Elkem’s sustainability report 2012

dust
Extensive, research-based work to
reduce dust in the workplace
The dust that is created in the
furnace halls in silicon and
ferrosilicon plants can represent
a health hazard for the
employees. New equipment
is to reduce the dust and
loss of material, and increase
productivity. Elkem Carbon
is also making significant
investments to reduce dust
from its production.
Dust emissions from ferro-alloy and
silicon plants have been dramatically
reduced since the 1970s and 80s,
when dust emissions from the smelters
coloured their local communities light
grey. Elkem developed a method to
collect the fine silicon-containing dust,
and subsequently developed a market
for this product, which is now known as
Elkem Microsilica® and has many uses.
In the past couple of years, Elkem has
increased its work on reducing the dust
formed in the furnace halls. This dust
is a burden for the employees, and it
has been documented that the dust
can lead to a risk of reduced pulmonary
function. This knowledge is based on a
large research study that was initiated
by Elkem and subsequently continued
by the entire smelting industry. The
study was conducted by independent
researchers with a medical background
(the occupational OPD project; see
below). Dust also leaks out of the halls
via windows, doors and fans, and thus
also affects the external environment
at the plants. Everyone in the most
exposed areas are therefore required to
use masks/respirators.
Order from the Norwegian Labour
Inspection Authority
In the autumn of 2012, the Norwegian
Labour Inspection Authority issued a
decision ordering Elkem to implement a
three-step process for all of Elkem’s silicon
and ferrosilicon smelters in Norway:
1. Conduct detailed occupational
hygiene surveys and risk assessments
of employees’ exposure to chemicals,
including dust from production.
2. Establish an action plan with effective
measures to reduce such exposure
adequately.
3. The effect of the measures must be
measured and documented by the end
of 2015.
Elkem has taken this challenge from the
Norwegian Labour Inspection Authority
seriously, and has established its own
project groups that are working actively
to identify deviations and measures to
solve these within a reasonable time.
The goal is to ensure that dust emissions
in the work place are well below
government thresholds.
Elkem has developed a Group Standard
for occupational hygiene surveys in
order to, among other things, ensure a
numerical documentation of the current
Elkem’s sustainability report 2012 21

dust
dust exposure in Elkem plants worldwide.
Internal values have been set for
dust measures in the Group, and these
are stricter than government requirements.
Extensive occupational hygiene
surveys
At each of Elkem’s five plants in Norway,
between about 500 and 1,000 tests will
be taken in 2012 and 2013, mainly for
different types of mixed dust, but also
specifically for quartz dust and dust and
gas that contain polycyclic aromatic
hydrocarbon (PAH). Elkem has defined
eight main areas for the exposure:
Logistics/transport/raw materials, furnace
buildings, crushing/sieving/packing,
microsilica, electrode, refractory
materials, maintenance and laboratory.
The tests are taken by using a pump
to suck air through a filter or absorbent
fixed in the breathing zone (for example,
on the outside of the breast pocket) of
the employee. Air pollutants in the work
space are collected in the filter or absorbent
and are later analysed in a laboratory.
A specific number of employees
carry testing equipment for several days
in order to get a representative result for
the work area and tasks they perform.
In addition to their own resources, many
plants have hired external consultants
to conduct the occupational hygiene
survey.
Once dust-reducing measures have
been implemented, the measurements
will be repeated to check the effect of
the measures
Some of the measures entail large
investments that as yet have an
unknown effect on the amount of dust
in the furnace halls. How quickly the different
plants and work functions within
the plants will reach dust values below
government thresholds and Elkem’s
internal limits is therefore uncertain.
In this work, Elkem emphasises having
a good dialogue with the Norwegian
Labour Inspection Authority and the
employee organisations.
Three main sources
Through the FUME (Fugitive Emissions
of Materials and Energy) research project,
the dust sources in the production
of (ferro)silicon have been mapped. The
combination of high temperatures and
fine particles that quickly spread and
cover large areas unless kept contained
in a closed area are a shared challenge
for these dust sources. This makes it
costly and technically demanding to find
effective methods to reduce dust.
According to the study, there are three
main sources of dust in the production
process:
• Tapping area
• Casting area
• Crushing, sieving and packing area
In addition to the dust formation during
tapping, casting and crushing, sieving
and packing, dust is also produced
during mechanical processes, such
as the transport of goods, readying
used tapping ladles and the welding of
now
Dust levels at Elkem Carbon’s manufacturing facility in
Kristiansand significantly decreased after a new type of
screen was installed.
before
22
Elkem’s sustainability report 2012

electrode casings
Point suction in the tapping areas.
The existing suction systems in the
tapping areas have been shown to
be inadequate in relation to current
thresholds. Thorough work to develop a
new and adapted suction system for the
tapping area was conducted at Elkem
Thamshavn in collaboration with, and
as an extension of, the dust project.
This resulted in the new «doghouse»
suction system. The special aspect of
the doghouse solution is that the flue
gas is extracted as close to the source
as possible, and with the lowest suction
volume possible. The first industrial
doghouse solution was installed at
Thamshavn furnace 1 in 2012, and
the results were immediately visible in
the form of cleaner air. The concept is
still being developed, and an improved
version has already been developed for
furnace 2 at Thamshavn. The plan is
to implement doghouse technology for
all the other smelters in Elkem. However,
because the plants and furnaces
are different, the doghouse technology
cannot be copied directly. Thus it may
take some time before all furnaces and
plants have good solutions in place.
The installation entails significant capital
costs: A «doghouse» costs about
NOK five million, and Elkem has nine
furnaces only in Norway that require the
equipment.
Dust is also produced in the casting
area when liquid metal is poured into
moulds, cooled down and then transported
on for further processing or
storage. New casting facilities in which
liquid metal is poured with the ladle in a
fixed position instead of it being moved
to a number of casting moulds, give us
the possibility of developing new point
suction solutions based on the same
philosophy used in the tapping area.
Work has started on developing such a
system, but here too we need to solve a
number of difficult technical challenges
in a new way before an industrialisation
is achievable.
Crushing, sieving and packing. The
customer orders silicon in different fractions
adapted to their production. This
entails a crushing and sieving process
that creates a lot of dust. Large suction
systems are already in use at all plants,
but research is also being conducted on
methods that integrate casting, crushing
and sieving in one process. This will
make the process significantly more
efficient, and thus have a positive effect
on both the economics of the plants and
employee health.
Reduced dust, simpler process
At Elkem Carbon’s production facility in
Kristiansand, dust has been significantly
reduced after a new type of screen was
installed in 2012. In addition to reducing
the amount of dust, the new screen has
also led to a noise reduction. Because
the improved technology is also better
adapted for safe maintenance and
screen replacement, the risk of accidents
has also been reduced. The same
screen will also be installed in Brazil
and South Africa.
Elkem Carbon in Kristiansand is also
testing a new type of mixer. The mixer
is smaller, which makes it easier to
capture smoke containing PAH from
the mixing process. The new mixer also
has other advantages: It produces less
dust, it takes up less space and it is
more flexible in terms of being able to
produce different product mixtures.
Researching dust since 1996
In the mid-1990s, Elkem’s toxicologist
was asked by management and
employees whether the mixed dust
in the furnace halls might be a health
hazard. It was well-known that it was
inadvisable to breathe in any type
of dust, and that the hazardousness
depended on the chemistry of the
dust. However, there was not enough
knowledge about any health consequences
caused by the mixed dust
in the smelting industry. Therefore,
a study was started in 1996 to try
to develop a tool that the occupational
health services could share
to examine employees’ pulmonary
function and to chart any incidences
of obstructive pulmonary diseases
(OPD) among Elkem employees. In
1998, several other smelting companies
joined in the work, and systematic
health surveys were conducted
for employees in the entire smelting
industry. Data collection for the
research concluded in 2003.
The conclusion from the «occupational
OPD» study is that there may
be a connection between exposure
to mixed dust in the smelting industry
and an increased risk of reduced pulmonary
function. This risk increases
further for employees who smoke.
On this basis, it was decided to
implement routine health examinations
of exposed Elkem employees,
using the method developed during
the study. In 2009, a large research
project started that was organised by
Ferrolegeringindustriens forskningsforening
(«The Ferroalloy Industry’s
Research Association») along with
researchers from SINTEF and NTNU.
This project is called FUME (Fugitive
Emissions of Materials and Energy).
All Norwegian smelting companies
participate in the project, which has
a framework of NOK 36.6 million and
is funded by the Research Council of
Norway, the «The Ferroalloy Industry’s
Research Association» and Elkem.
FUME has made important contributions
to the work on developing
specific technical measures to reduce
dust emissions at the most important
sources. Finding effective measures
requires a detailed understanding of
how the dust and the material that produces
the dust behave when moving
from extreme temperatures in the furnaces
and going through the various
steps to the finished product.
Elkem’s sustainability report 2012 23

Environment, health and safety (EHS)
One year without any permanent injuries
Elkem has a vision of zero
injuries or work-related illnesses.
All personal injuries
requiring medical treatment
and all serious near-accidents
are evaluated by Group
management, so that Elkem
can learn from them and thus
continue to reduce the number
of injuries. Nevertheless,
the current trend shows that
the strong rate of improvement
Elkem had until
2007/2008 has tapered off.
In addition to having a continuous
focus on injuries, Elkem has initiated
extensive work to reduce employees’
exposure to dusts, and to reduce
Elkem’s environmental footprint. This
work is discussed elsewhere in this
report.
A review of the undesired events registered
in 2012 shows that Elkem avoided
permanent injuries but that there were
a number of near-accidents with a
high injury potential. Most injuries were
cuts and burns, and typically involved
fingers, feet or the face. All of these
injuries could have been avoided.
The reporting and investigation of
absolutely every undesired event is at
the core of the improvement of EHS in
Elkem. A report detailing all undesired
events is prepared each month for each
business area. Detailed presentations of
the course of events, including lessons
to be drawn, are prepared for all serious
events. In this way, the experiences can
be shared with other plants and Elkem
avoids having similar events occur
again. The status of the EHS work and
serious events are discussed weekly at
the Group management level.
After the fatal accident at Thamshavn
in 2011, in which a strong current went
through the body of an employee,
an extensive programme to improve
safety in Elkem’s high voltage system
has been completed. The ELSAFE
programme has evaluated the safety
of the high voltage system and has
established a Group standard for design
and operating procedures, in addition to
identifying and correcting deviations in
the existing system.
Following serious fires at three plants
in 2011, Elkem has also implemented
extensive work to reduce the risk of fire.
New standards for and organisation of
fire prevention work have been approved
and are being implemented at the
plants, along with employee training.
Sick leave
Elkem employees had an average
sick-leave rate of 3.9 per cent in 2012,
against four per cent in 2011. This is
higher than the 2007-2010 average,
when the sick leave rate was between
3.3 and 3.7 per cent. Studies of the
2012 sick leaves do not suggest that the
increase can be linked to issues in the
workplace. Ongoing activities to reduce
the sick leaves include close follow-up
of each employee during periods of
absence and making adaptations
to enable graduated sick leaves.
24
Elkem’s sustainability report 2012

Significant effort must also be expended
to improve the working environment.
The focus must be on noise and dust
reduction, improved work positions,
and further strengthening the control of
employees’ exposure to chemicals.
Safety in the workplace
Elkem’s production involves many
potentially dangerous situations:
People interact with large quantities
of raw materials, chemicals, powerful
machinery and very high temperatures.
In an environment with liquid metals,
machinery and vehicles, it is vital that
everyone is aware of the dangers and
that guidelines for safe behaviour are
followed. Elkem’s goal is to conduct
its operations without any injuries or
occupational illnesses. In addition to this
being important from an ethical point
of view, Elkem believes that time and
resources spent on safety work form
the basis for a more efficient production
and less waste. In performance evaluations,
injury prevention is emphasised to
the same extent as production, quality,
sales, delivery times, efficiency and cost
control.
«Focus»
«Focus» is Elkem’s programme for HSE
in the workplace. ’Focus’ is closely connected
with the Elkem Business System
(EBS), and emphasises continuous
improvement and each employee’s
responsibility for contributing to good
results. ’Focus’ has five foundational
principles:
1. Work on improvement has no limits.
2. All events and injuries can be
prevented (target of zero injuries).
3. All events and injuries have causes.
• Event reports provide an opportunity
to study the course of events, learn
from the event and implement
measures to prevent recurrence.
• Events are always caused by
dangerous conditions, dangerous
actions or a combination of these.
• Causes are rarely singular. To prevent
recurrences, we must always find and
remove the root cause of the event.
All preventative efforts are founded on
identifying dangers, risk assessments
and implementing measures to reduce
risk to an acceptable level.
Success depends on all employees
being actively involved in EHS work and
sharing responsibility for ensuring a safe
work environment.
Case:
Cut to the head
after falling one
metre
All injuries and serious near-accident
in Elkem are reviewed in detail and
reported to Group management for
review.
An example of such a case is an
injury that occurred at one of the
plants when an employee replaced
batteries in a clock that was hanging
high up on a pole. To reach the clock,
the employee stood on a pallet that
was raised by a forklift. On the way
down, he lost his balance, fell one
metre from the forklift, and cut his
head. The cut was not serious, but
the event had significant potential for
serious injury: in the area where he
fell, there were a number of sharp
items that could have resulted in
permanent injury if he had landed
differently.
Lessons:
• Did not choose a safe solution
• Did not see the danger/risk
• Violated safety rules
• Always take the time to complete a
Safe Job Analysis before performing
the job
• Choose safe solutions over quick
solutions.
Development in the number of injuries
40
35
30
25
20
15
10
5
0
2000 2002 2004 2006 2008 2010 2012
Number of injuries per million work hours with absences
Number of injuries with medical treatment and/or work limitations per
million work hours
Sick leave as a percentage
8
7
6
5
4
3
2
1
0
2000 2002 2004 2006 2008 2010 2012
Elkem’s sustainability report 2012 25

Elkem Silicon Materials
Large sustainable improvement projects
The list of products in which
silicon is a component is
long and very varied. Elkem
Silicon Materials produces
silicon of different qualities,
specially developed to
make other products
lighter, stronger, more heat
resistant and thus also more
sustainable. The goal is
produce silicon in an evermore
sustainable way.
There are three plants in Elkem Silicon
Materials: Salten, with three furnaces;
Thamshavn, with two furnaces; and Bremanger,
with one furnace. The plants
supply different qualities of silicon for a
large number of very different end products:
Chemical industry converts silicon
to silicone; the electronics industry uses
silicon in computers, telephones and
other electronics; the car industry needs
silicon to be able to use aluminium
in car manufacturing; and microsilica
is used to make products more heat
resistant and concrete stronger, among
other things. Microsilica is also used
as a replacement for asbestos in heat
resistant materials (such as linings in
oil wells), in fertilisers and in plastic.
Research is also being carried out on
the use of silicon in batteries, which can
revolutionise where batteries may be
used and make electric cars more user
friendly. The use of silicon in batteries is
discussed in a separate article.
Elkem is a world leader in microsilica
and had a turnover of 250,000 tonnes
in 2012, of which half is from our own
production and the rest is refined dust
from other producers. Elkem developed
the cleaning technology that captures
microsilica particles from the chimneys
of silicon furnaces. Elkem’s substantial
investment in product development has
also established an important market
for this product, which was originally
considered an annoying and polluting
waste product.
Energy recovery
The plan is for all of Elkem’s silicon
plants to install energy recovery facilities
and to introduce modern technology
that reduces the emission of dust, NO x
and other gases as much as possible.
Sustainable production, with a focus on
energy utilisation, is a consistent theme
in the planning of all activities.
Elkem is at the planning stage of a
project for the construction of an energy
recovery facility for more than 300 GWh
tied to the three furnaces at Salten. This
means that of an electricity consumption
of 1,000 GWh, a third will be returned to
the electricity network. Enova awarded
this project a subsidy grant in 2012. The
energy recovery facility at Salten will
cost about NOK 1 billion. Elkem expects
a need for more planning before the
project may be realised.
In 2012, the upgrade of the recovery
facility at the Thamshavn plant was
completed, increasing capacity from 90
to 165 TWh annually. Energy recovery is
also planned for the Bremanger plant.
Cutting-edge furnace
In 2013, the reconstruction of a furnace
at Salten began. The reconstruction
will allow it to supply 99 per cent pure
silicon (Si99) from the summer of 2013;
it has previously supplied ferrosilicon.
This is an important milestone for
the company. The reconstruction has
cost NOK 250 million and resulted in
a cutting-edge furnace. Installing new
technology has been an important
part of the reconstruction, and this will
result in NO x emissions from the new
furnace to be much lower than from the
old furnace. The introduction of similar
technology at other plants will follow
once the results at Salten have been
documented.
New furnace reduces NOx
emissions
Development Manager Nils Eivind
Kamfjord at Elkem Salten has a
doctorate in the reduction of NO x
emissions from smelting processes.
As part of his doctoral work, Kamfjord
measured various emissions from
the Salten furnaces. Among other
things, the measurements showed
that emissions were much higher than
previously thought based on estimates.
The differences were so large that the
measurements were repeated, but the
results remained the same.
The doctoral work shows how NO x is
formed in the furnaces. NO x is formed
in «pockets» of especially high temperatures
to a much larger degree than previously
thought. After having run tests in
a trial facility, researchers found another
way of operating the furnaces that lower
NO x emissions without reducing the
effect of the furnace.
This is expected to result in significant
reductions of NO x emissions. The scope
of the reduction will only be clear once
the reconstructed furnace has been in
operation for a period and new measurements
have been taken.
If the NO x project is successful, the new
technology will be significant for the
environment and the smelting industry.
Improved knowledge of the relationship
between process design and NO x emissions
will contribute to better standards
for the silicon and ferrosilicon industry
with subsequent reductions of NO x
emissions worldwide.
Development Manager Nils Eivind
Kamfjord at Elkem Salten has a
doctorate in the reduction of NOx
emissions from smelting processes.
26
Elkem’s sustainability report 2012

Silicon in processed form is used in all kinds of electronic equipment.
Silicon is the most important input in the production of solar panels.
Chemically treated silicon forms silicone, which is used in everything
from cosmetics to lubricants, medical supplies, paints, sealants, kitchen
utensils and other products where silicone’s heat resistant and waterproof
properties are helpful.
The automotive industry needs silicon to use aluminum in car production,
and in volume the aluminum industry is the main user of silicon.
Elkem Microsilica ® is used as an additive in high performance concrete,
lining of oil wells, as an asbestos substitute, in refractory materials,
fertilisers and plastics.
Elkem’s sustainability report 2012 27

Elkem Silicon Materials
This is how silicon and ferrosilicon are produced
Silicon is formed in a chemical process
under high temperatures, where
the silicon in quartz is released from
the oxygen because the oxygen in the
quartz binds to carbon. Quartz and
different types of carbonaceous material
(such as coke, coal, charcoal and woodchips)
are fed into the smelter. Three
electrodes made from a carbonaceous
material are lowered into this mixture.
Elkem Carbon is the world’s leading
producers of such electrodes and
supplies Elkem’s silicon plants. When
electricity is turned on, a powerful arc is
formed between the electrodes, causing
the oxygen in the quartz to react with
the carbon in the carbonaceous material
and form CO 2 gas. The CO 2 gas rises
while the silicon is tapped from the
bottom of the furnace.
Elkem Foundry produces ferrosilicon.
Here, iron (ferro-) is added in the production
process.
Therefore, CO 2 is always produced
when silicon and ferrosilicon are
produced. If we are to reduce net CO 2
emission from the production process,
we have to find ways to capture and use
the CO 2 gas. At Elkem Salten, research
is being done on how both CO 2 and
NO x can be used in the production of
biomass.
28
Elkem’s sustainability report 2012

Plants
Bremanger, Norway
Established: 1928
Number of employees: 95
Produces: Silicon for electronics and
solar cells. Elkem Microsilica ® for concrete
and oil wells.
Certifications: ISO 9001 certified since
1990. ISO 14001 certified since 1999. ISO/
TS 16949 certified since 2007. Certified in
accordance with EN 13263-1:2005 Elkem
Microsilica ® for concrete.
Measures in 2012: Elkem Bremanger
produces super-pure silicon (Silgrain ® ) for the
electronics and solar cell markets. The plant
is continuously working to further develop
product quality and new areas of use.
In 2012, important focus areas have
included:
• Improvement of the plant’s production
processes to ensure competitiveness in a
challenging market for silicon for solar cells
and electronics.
• Investment in raw material systems and
cooling system for improved utilization of raw
materials and energy.
• Began sales of Silgrain ® e-Si, silicon for
next-generation of lithium-ion batteries.
Salten, NORWAY
Established: 1967
Number of employees: 170
Produces: Silicon for aluminium,
chemistry and electronics/solar cells. Elkem
Microsilica ® for concrete, refractory materials
and polymers (plastic/rubber).
Certifications: ISO 9001 certified since
1991. ISO 14001 certified since 1999
Certified in accordance with EN 13263-1:2005
microsilica for concrete.
Measures in 2012: Elkem Salten has a
broad portfolio of products both in silicon and
Elkem Microsilica ® . The plant has continued
its efforts throughout 2012. Investments in the
order of 250 million are under implementation.
In addition to improving the plant’s market
position, the investments will also provide
improvements in health and the environment.
Elkem Salten is the only silicon plant in the
world to produce Microsilica ® for the polymer
market (plastic and rubber).
Tana mines, NORWAY
Established: 1973 by Sydvaranger AS,
acquired by Elkem 1983.
Number of employees: 42 of whom 21
are employed by Elkem Tana and 21 by a
subcontractor.
Produces: Quartzite for ferrosilicon and
silicon industry, both for Elkem and for external
plants.
Certifications: ISO 9001
Measures in 2012: Elkem Tana AS is one
of the largest quartzite mines with an output
of around 1 million tonnes of quartzite in 2012.
The mine produces several grades and fractions.
In 2012 the plant worked to find use for
most of the mined material so that this natural
resource is exploited in a sustainable manner.
Work on further improving the quality and
increasing the mines operating life continued.
Thamshavn, NORWAY
Established: 1930
Number of employees: 150
Produces: Silicon for chemistry (silicone),
aluminium and solar cells. Elkem Microsilica ®
for concrete and refractory products.
Certifications: ISO 9001 certified since
1992. Certified in accordance with
EN 13263-1:2005 microsilica for concrete
Measures in 2012: In 2012 Thamshavn
conducted several extensive projects to
optimise the plant’s products to its customers
and enhance its competitive position.
Elkem Thamshavn has a strong position in
microsilica for delivery of refractory products.
Throughout 2012, the plant optimized and
maintained recycling including a new generator
that provides a recovery of close to 30% of
supplied electrical energy.
Elkem’s sustainability report 2012 29

Elkem Carbon
Becoming its own energy supplier
Elkem Carbon’s plant in Brazil has installed a facility for
biological treatment of contaminated rainwater. Rain that
falls in the factory area is polluted by dust, PAH and other
pollutants. In the tropical climate of Brazil, it is possible to
clean this rainwater biologically.
technology also requires less maintenance.
By eliminating complicated
maintenance tasks, the risk of accidents
has been reduced. This type of screen
will also be installed at Elkem Carbon’s
production facilities in South Africa and
Brazil.
When steel, aluminium,
silicone and other metals are
produced, Elkem Carbon’s
products are necessary in the
process. Elkem Carbon is
among the world’s largest
producers of electrical
calcined anthracite and
electrode paste. Continuous
improvement of both products
and process is very important
to Elkem Carbon.
Elkem Carbon has production in Norway,
Brazil, China and South Africa. Elkem
Carbon Ferroveld in South Africa is a joint
venture between Elkem Carbon and
Samancor Crome, with Elkem as plant
operator. Elkem Carbon has 408 employees
at five plants.
Energy. In 2012, a large energy recovery
project started at Elkem Carbon’s
production facility in Kristiansand. The
project receives funding from Enova.
The plan is to save up to 34 GWh. By
contributing to keeping pitch (a component
of Elkem products) liquid, heat from
the furnaces that calcinate anthracite is to
be used to reduce energy consumption in
other parts of the production. The plan is
for the heat from the calcination furnaces
to also be used to replace electricity and
oil as sources of heat for offices and
other buildings at Elkem’s industrial area
at Fiskå in Kristiansand. The energy
project is presented in a separate article.
Sulphur. The energy recovery facility to
be installed at Elkem Carbon’s calcination
furnaces in Kristiansand reduces the
temperature of the gas from the furnaces
from 1,000 to 200 degrees Celsius. This
makes it possible to significantly reduce
sulphur emissions from the factory.
Smart buildings. As part of the large
energy project in Kristiansand, Elkem
Carbon is considering building indoor
silos for the storage and drying of
anthracite coal. The silos will also protect
our coal stores from precipitation which
would otherwise add moisture to the coal
and thus lead to a more energy-intensive
calcination process. In winter, it has been
a labour-intensive problem that the coal
freezes in blocks of ice that are difficult to
handle.
Elkem Carbon’s new production facility in
Kristiansand, which started up in 2012,
has been built vertically. The production
process is thus helped by gravity when
the products are to be moved from one
step of the production to the next. This
saves labour and energy, and the plant
takes up less space.
Noise and dust. At Elkem Carbon’s
production facility in Kristiansand, the
amount of dusts and noise in the
production process has been reduced
significantly after a new type of screen
was installed in 2012. The improved
PAH. Elkem Carbon in Kristiansand is
testing a new mixer, which is where
calcined anthracite and pitch are mixed.
The mixer is smaller than the previous
one, which makes it easier to capture
PAH fumes from the mixing process. The
new mixer also has other advantages: It
produces less dusts, takes less space
and is more flexible with regard to
producing different product mixes.
Elkem is working on developing ramming
paste that does not emit PAH. The
product is being tested by customers.
Rain that falls in the factory area is
polluted by dust, PAH and other pollutants.
In the tropical climate of Brazil, it is
possible to clean this rainwater biologically,
using three pools:
• One filled with old trees with bark
• One filled with special plants
• One filled with bacteria that eat
products containing oil
Colorir
Fourteen years ago, Elkem in Brazil
started the neighbourhood project Colorir.
The project was aimed at school-aged
children in the local communities around
the plants. The goal was to reduce
violence and vandalism in poor neighbourhoods
characterised by crime and
poverty. Since its inception, more than
10,000 children have completed the
programme. Elkem has developed the
teaching materials, and Elkem employees
in Brazil participate as volunteers. In
2011, Colorir won the prize for Brazil’s
best project in the socio-economic development
category, and placed second in
the education and development category.
Colorir is now registered as an independent
organisation in Brazil, and several
companies participate as sponsors when
the project is rolled out in other areas in
Brazil.
30
Elkem’s sustainability report 2012

Facts
Electrical calcined anthracite
Anthracite, which is the purest form of
coal, are found naturally in coal mines
and has a carbon content of 92-98 per
cent. Calcination is the heat processing
of solid raw materials. The heat
processing turns the anthracite into an
electroconductive, clean and resistant
material.
Pitch
Coal tar pitch is used as a binding
agent in various carbon materials,
including ramming paste and electrode
paste. Tar is the raw material used to
produce pitch. Tar, in turn, is a by-product
from the production of metallurgical
coke, which is used in furnaces for
the production of iron.
Electrode paste
Electrode paste consists of calcined
anthracite coal and pitch. It is supplied
as briquettes, blocks or cylinders, and
is part of self-baking electrode systems
in smelters. The smelting plants
need the electrodes to conduct electricity
and to help provide sufficient heat
energy to the smelters. The electrodes
are also necessary where production
is based on smelting electrolysis,
which are chemical processes created
using electricity, with the production of
aluminium being a prime example.
Ramming paste
Ramming paste seals joints and prevents
the furnace from being harmed
by liquid metal. The paste is installed
by ramming, i.e. by vibrating and
pressing it. The ramming paste is then
«baked» at 960°C so that it becomes
firm and fully sealed.
Calcined anthracite and pitch are the
main components of the ramming
paste. Elkem Carbon’s products are
developed to give the best possible
work environment and are so-called
cold ramming pastes, which are installed
at room temperature. The exposure
to potentially dangerous PAHs from the
binding agent is thus minimal. Elkem
Carbon is working systematically to
develop new and more environmentally
friendly solutions, and also offers products
with alternative binding agents
that do not contain PAHs.
Carburisers
The manufacture of castings in iron
foundries using electric furnaces
and relying on scrap as raw material
requires the addition of carbon
material. These are called carburisers.
The further development of technical
solutions at Elkem Carbon’s plant in
Kristiansand has resulted in the Elkem
product Elgraph ® , which is a very high
quality carburiser. Elgraph ® has low
levels of sulphur, nitrogen and volatile
organic compounds content, and satisfies
the increasingly strict requirements
to such products from iron foundries
and steel manufacturers.
PAH
PAHs (Polycyclic Aromatic Hydrocarbons)
include many different
compounds. PAHs are formed during
all incomplete combustion of organic
materials. The aluminium industry and
the use of wood for heating are the largest
sources of PAH emissions. PAHs
consist of many different compounds
that are built from several benzene
rings. How poisonous and hazardous
the PAH compounds are varies.
Plants
Elkem Carbon in Kristiansand,
norway
Established: 1904
Number of employees: 69
Apprentices: 9
Certifications: ISO 9001:2000, ISO 14001,
ISO 18000.
Produces: Electrical calcined
anthracite, Söderberg
electrode paste, carburisers
(Elgraph ® ), ramming paste.
Measures in 2012: Energy recovery facility
being tested.
Elkem Carbon Ferroveld in
wItbank (South Afrika)
Established: 1974. Joint Venture
between Elkem Carbon
and Samancor Chrome;
Elkem operates the plant.
Number of employees: 69
Certifications: ISO 9001:2000,
ISO 14001, ISO 18000.
Produces: Electrical calcined
anthracite, Söderberg
electrode paste.
Measures in 2012: Reduced use of water.
Elkem Carbon China in
Shizuishan
Production start: May 2000.
Number of employees: 111
Certifications: ISO 9001:2000, ISO 14001.
Produces: Electrical calcined
anthracite, Söderberg
electrode paste, ramming
paste.
Measures in 2012 Energy recovery from
three calcination furnaces, in which recovered
energy is replacing energy from coal.
Elkem Carbon China won an award for being
a ’Responsible Citizen’ from among ISO
14000 companies in the area.
Elkem CarboIndustrial in
vItoria (Brazil)
Established: 1976
Number of employees: 99
Certifications: ISO 9001:2000,
ISO 14001, ISO 18000.
Produces: Electrical calcined
anthracite, Söderberg
electrode paste, electrodes,
ramming paste.
Elkem CarboDerivados, Vitoria
(Brazil)
Established: 1976
Number of employees: 47
Apprentices: 2
Certifications: ISO 9001:2000,
ISO 14001, ISO 18000.
Produces: Pitch and other raw
materials for the production
of electrode paste and
ramming paste.
Measures in 2012: Elkem Carboderivados
and Elkem Carboindustrial established a joint
biological water treatment plant in 2011.
Elkem’s sustainability report 2012 31

Elkem Foundry Products
Major improvements in energy efficiency
An important measure to increase the
overall energy efficiency in 2012 was the
construction of the energy recovery system
at Chicoutimi in Canada, which delivers
210 GWh to the nearby Rio Tinto Alcan
aluminum plant. Here you see the pipeline
that transports steam to the aluminum plant.
Photo: Pascal Nadeau, Elkem
In 2012 Elkem Foundry
Products made major
improvements in terms of
productivity and energy
efficiency.
Reducing waste of all kinds is the key
element in the Elkem business system
(EBS). In 2012, Elkem Foundry Products
increased its productivity by eight
per cent without having to make new
investments.
The improvement is a result of larger
loads in the existing furnaces (three
per cent); increased efficiency of the
furnaces (three per cent) and remelting
of fines (two per cent).
Fines are leftovers from the ferrosilicon
crushing process. Up until now
they have been sold at a relatively low
market price. The fines come in different
sizes depending on the crushing
size of the finished product sold. The
fines are collected and reinjected into
the ladle, where they are remelted in a
high-temperature liquid metal. In order
to minimize the use of energy, Elkem
has carried out research to identify the
optimal casting temperature for the
ferroalloys – the temperature at which
the fines can be reinjected into the ladle
without having to add more energy to
the process.
The energy efficiency of the production
process has improved with about five
per cent. This has a direct impact on
the electricity consumption needed to
run the furnaces. Hence, the energy
consumption per ton of finished product
has been reduced by five per cent.
Another important measure to increase
the overall energy efficiency in 2012
was the construction of the energy recovery
system at Chicoutimi in Canada,
which delivers 210 GWh to the nearby
Rio Tinto Alcan aluminum plant.
Elkem Foundry Products relined two of
its furnaces in 2012. Three furnaces are
scheduled for relining in 2014 and 2015.
New linings extend the lifetime of a furnace
with 15-20 years and are necessary
to ensure an optimal process, which
is crucial both for economical and en
environmental reasons.
Elkem Foundry Products has been run-
32
Elkem’s sustainability report 2012

ning without any market-induced idling
in 2012.
World leading producer
Elkem Foundry Products is the world’s
leading producer of ferrosilicon and
ferrosilicon-based metal alloys. Ferrosilicon
is an important raw material for the
steel and foundry industry, and helps
to ensure that the windmill, vehicle and
engineering industries can manufacture
well-functioning products. Elkem is a
major global producer of inoculants.
The distinguishing feature of Elkem’s
inoculants is that the end user can
reduce the amount of material added
and end up with equally good working
properties, and the proportion of scrapped
product is often reduced as well.
This helps to improve the customer’s
productivity, while reducing total energy
consumption.
Elkem Foundry Products has five plants
– two in Norway (Bremanger and Bjølvefossen),
one in Iceland (Grundartangi),
one in Canada (Chicoutimi) and one
in China (Shizuishan). Elkem Foundry
Products has sales offices or agents
around the world, and also has its
own product development department.
Facts
Ferro is a prefix that indicates a link
to iron, and ferrosilicon is an alloy
consisting of a combination of iron
and silicon. Ferrosilicon is produced
by carbothermal reduction. Quartz
reacts with carbon (in coal, coke,
wood chippings) under high temperatures,
and iron is added during the
process. There are two primary areas
of application for ferrosilicon:
The product is most commonly used
in the steel industry, where oxygen is
removed in furnaces (deoxidation). It
is also used as an alloying addition to
make various steel grades.
Elkem Foundry has a significant market
share in Europe.
The amount added depends on what
the steel is going to be used to make
later: e.g. stainless steel (sinks, cutlery,
and kitchens), steel for electrical
purposes (motors, generators, and
transformers), carbon steel (railway
tracks, coils) or speciality steel (ball
bearings, tools).
Inoculants are ferrosilicon-based
alloys that contain iron, silicon, and
other minerals such as barium, strontium
and cerium. These are alloys
that are added to foundry products
to improve their working properties,
thermal conductivity, and strength.
Ferrosilicon-magnesium contains
iron, silicon, magnesium and rare
earth elements. The alloy is added to
foundry products for a number of reasons,
amongst other things to make
them stronger.
Plants
Bremanger in norway
Established: 1928
Number of employees: 75
Produces: Ferrosilicon-based alloys
(inoculants)
Certifications: ISO 9001, ISO 14001,
ISO TS 16949.
Measures in 2012: Furnace 2 relining with
new design lining to give a new lifetime to the
furnace of 15-20 years. Plan to reline furnace
4 in 2014. Began the start-up of the new caster.
Work on post tap hole improvement.
Bjølvefossen in norway
Established: 1905
Number of employees: 144
Produces: Ferrosilicon-magnesium
and various ferrosilicon
grades.
Certifications: ISO 9001, ISO 14001
(ISO TS 16949 planned
for 2013/2014)
Measures in 2012: Furnace 5 relining
with new design lining for FeSi 50 production
to give a new lifetime to the furnace of
15-20 years. Plan to reline furnace 1 in 2015.
Concept study to increase furnace 1 capacity.
Concept study to improve electrical turbine
efficiency.
Grundartangi on Iceland
Established: 1975
Number of employees: 177
Produces: Various ferrosilicon grades
Certifications: ISO 9001
Measures in 2012: Main focus on furnace
operation improvement and post-taphole
improvement. Strategy to penetrate the
electrical steel market.
Chicoutimi in Canada
Established: 1966
Number of employees: 80
Produces: Ferrosilicon-magnesium
and ferrosilicon-based
alloys (inoculants).
Certifications: ISO 9001, ISO 14001
Measures in 2012: IInstallation of the heat
recovery system (210 GWh) delayed due to
deliveries, but started up in spring 2013. Plan
to reline furnace 1 in 2014. Concept study
to increase furnace capacity during the next
relining.
Shizuishan in China
Established: 2005
Number of employees: 50
Produces: Ferrosilicon-magnesium.
Certifications: ISO 9001:2000, ISO14001
Measures in 2012: Installation of a second
induction furnace. Concept study to increase
capacity to 9000 MT.
Elkem’s sustainability report 2012 33

Elkem Solar
Lower energy consumption and a better
utilisation of solar energy
Independent tests show that modules produced with ESS produce about
2.5 per cent more electricity than modules produced with standard polysilicon.
Elkem Solar’s process for
making silicon for the solar
panel industry reduces
energy consumption by
75 per cent compared to
traditional processes. Elkem
Solar is also working to
reduce energy consumption
and simplify the process
further. At the same time,
tests from India show that
Elkem Solar Silicon ® produces
more electricity at high
temperatures and high solar
radiation than solar cells
made from polysilicon.
Elkem Solar’s production facility at
Fiskaa in Kristiansand has just over
200 employees. Global competition is
stiff in the solar cell industry, and 2012
was a challenging year for Elkem Solar.
Production was halted temporarily, and
employees have focused on technology
development and support for continuous
improvement in other Elkem units.
One of the main points of electricity
produced by solar panels is to reduce
climate gas emissions. When creating
a climate account for solar panels, it is
therefore important both to look at how
much energy has been consumed in the
production of the solar panel, and how
much electricity it produces through its
lifespan.
Comparing the energy consumption
during the production of Elkem Solar
Silicon ® (ESS) with polysilicon produced
in the traditional way (Siemens
method), it is clear that Elkem Solar
only uses a quarter of the energy. The
main reason for this is that Elkem Solar
cleans the silicon without transforming
it to a gas before returning it to silicon
metal, which is very energy-intensive
method.
Elkem Solar has now developed a new
process that will reduce energy requirements
by another 50 per cent. This
is a revolution compared to traditional
processes (Siemens method), and at a
comparative level the production of new
ESS will consume about 11 KWH per
kilo, against between 60 and 120 KWh
per kilo for polysilicon.
In short, the new process will simplify
the value chain and eliminate a directional
solidification. The energy benefit
originates in not having to reheat the
metal to a liquid form and then solidifying
it. The yield is also increased. Elkem
Solar is well underway with the new
process, but some development and
verification remains before it is ready for
industrialisation.
ESS produces more electricity
In addition to a less energy-intensive
production process, independent tests
indicate that Elkem Solar’s ESS
material produces more electricity.
Since August 2012, ESS has been
34
Elkem’s sustainability report 2012

tested at an independent research
institution in Hyderabad, India. Thus far,
the tests show that modules produced
with ESS produce about 2.5 per cent
more electricity than modules produced
with standard polysilicon. The cause of
this is not fully understood, but is partly
due to a better temperature coefficient,
i.e. less loss of efficiency at increasing
temperatures and less loss of electricity.
This is likely because of the composition
of trace materials in ESS, which polysilicon
does not contain. This appears
to increase electricity production at high
temperatures and direct solar radiation.
Tests also show that ESS is as durable
as polysilicon.
70 000
60 000
50 000
40 000
30 000
20 000
10 000
0
There are differences in solar
cell electricity
Japan is an important market for Elkem
Solar. In 2012, Japan introduced a system
of CO 2 labelling of all types of products,
so that customers can consider
climate effects when choosing between
different products. A large plant based
on ESS will be built by the multinational
company Kyocera in Kitakyushu
in Japan. Elkem will secure an official
approval of the CO 2 content of ESS
and use this actively in its marketing.
ESS will be part of the «foot print» of
the electricity that is produced, so that
solar electricity produced with ESS as
an input will have a climate advantage.
Installed global solar panel capacity per year in GW
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Strategic partner
Elkem Solar is looking for a partner
who will enable the company to fully
utilise the technological and climate
advantages of Elkem’s production process.
Energy consumption is already
just a quarter of the competitors’ consumption,
but to exploit the potential
further halving of energy consumption
Elkem is looking for a partner who
produces wafers, cells and panels.
The market for solar panels has grown
enormously in the past decade, from
2 GWh in 2002 to 28 GWh in 2012.
Market growth slowed down from
2011 to 2012, but the market did grow
in 2012 too. In the years ahead, an
annual growth of about 20 per cent is
expected, from a much higher base.
Thus far, Germany and Italy have
been the largest markets. Germany
is expected to continue to be a large
market, but will likely be passed by
China, the USA, Japan and other
countries outside of Europe. By 2017,
it is expected that the market for solar
panels will be more than double the
2012 market.
Source: IEA and Solarbuzz (prognosis)
Outline of the production process for Elkem Solar Silicon ®
Silicon
production
Quartz is converted
to silicon
in a smelter
with the use of
coal, woodchips
and electricity
Slag treatment
Boron is
removed in
a multi-step
purification process
by mixing
silicon with slag
in specially designed
reactors
Leaching
Silicon in solid
form is
submerged in
various acids.
Phosphorus is
removed
Smart solidification
Molten silicon
solidifies slowly
by cooling from
below. Remaining
impurities
floats to the
top and edges
Finished
Elkem Solar
Silicon ®
The top and
sides are cut
away, and super-pure
silicon
is ready
for delivery
Currently performed by customer
Casting Wafer block Finished
wafers
Ongoing technology process to remove
two steps of the production process in
collaboration with a downstream partner.
Silicon
production
Slag treatment Leaching Casting
Wafer block
Finished
wafers
Elkem’s sustainability report 2012 35

The history of Elkem
Technology development and improvements
Elkem’s history started in
1904, when the industrial
entrepreneur Sam Eide
(1866-1940) established
Det Norske Aktieselskap for
Elektrokemisk Industri. The
goal was to create a new
Norwegian business based on
Norwegian natural resources.
Elektrokemisk’s mission statement was
that it was to create new companies, and
this was a goal that was taken seriously.
A diary entry describes the atmosphere
in the offices of Elektrokemisk in 1911:
«Yesterday, Smidth left at 5 ¼ saying
’now I want to go home before a new
company is established.’»
In 1919, 51 companies were included in
the Elkem sphere. Elkem developed most
of these companies. Elkem has left its
mark in Norway: Norsk Hydro (renamed
Yara), Kristiansand Nikkelraffineringsverk
(now Xstrata), Lysefallene,
Kraftselskapet Bjølvefossen, Arendals
Fossekompani, Arendals Smelteverk,
Det Norske Nitridaktieselskap (DNN),
Skorovas Gruber, Titan (in Tyssedal) and
Norsk Sprængstoffindustri AS.
The competition for engineers was
just as fierce then as now. This is how
Conrad Wilhelm Enger, who later
became the director of Elkem, described
how he was hired in Elkem in 1906:
«While I was strolling along the platform
at a station in North Germany, a man
came towards me. ’I am Sam Eyde’,
he said, ’would you like a place at my
engineering office in Oslo’»
In 1917, the company made a technological
leap that was to be very significant
both for Elkem and for smelters worldwide.
The Elkem engineer Carl Wilhelm
Söderberg invented the continuous
electrode, which meant that smelters
no longer had to cool the furnaces
down each time the electrode paste
was exhausted. Continuous heat saved
labour and energy. Elkem’s Söderberg
patent is currently in use at about 75 per
cent of smelting plants worldwide.
During the depression in the 1920s
and 30s, nearly all of Elkem’s companies
were sold, and when the Second
World War started in 1940, Elkem only
had two sources of income: The rights
to the Söderberg patent and the production
of ferrosilicon at Fiskaa Verk in
Kristiansand.
After the war, Elkem saw a continuous
expansion, both in Norway and internationally.
In 1972, Elkem merged with
Christiania Spikerverk and became
Norway’s largest industrial company. At
the same time, the company actively
encouraged the introduction of corporate
democracy, which ensured
employee representation on the Board
from 1974. In the same period, there
was a strong focus on improvements of
the internal and external environment.
Elkem was also a pioneer in formulating
an approach to social responsibility.
Karl Lorck, Elkem’s CEO from 1971 to
1980 said «It is therefore necessary to
consider the company’s place in society
in the short- and long-term. In addition to
the economic factors, ethical, social and
environmental issues are also included in
this picture. These must be part of each
company’s goals.» (from EKKO, Elkem’s
company magazine, 1971)
From the early 1970s, Elkem started
installing filters on the chimneys of its
plants, which led to the disappearance
of troublesome industrial smoke from
industrial areas throughout Norway. The
filter technology has since been sold
worldwide. The cleaned dust - Elkem
Microsilica ® - is a valuable and useful
material that has many areas of application,
including in making concrete more
robust.
36
Elkem’s sustainability report 2012

In 1980, Elkem made huge expansions
in ferrosilicon and steel, but at the same
time China took the leading role as a
producer of ferrosilicon and steel based
on its low costs. In the 1980s and 90s,
Elkem was again in crisis and needing to
stake out a new course.
Elkem’s new course was to focus on
special products based on silicon, in
addition to aluminium production. At
the Bremanger plant, a wet process for
the production of clean silicon, called
Silgrain ® , was developed as in 1965.
This process was part of the technological
foundation when Elkem Solar was
created in 2009, producing Elkem Solar
Silicon ® . This is silicon for the solar panel
industry, produced with a quarter of the
energy Elkem’s competitors use in the
traditional silicon manufacturing process.
In 2004, Orkla and Alcoa fought to
acquire Elkem. The fight resulted in Orkla
purchasing Elkem in 2005, and de-listing
the company. Orkla sold Elkem’s aluminium
production to Alcoa in 2009.
In April 2011, China National Bluestar
acquired Elkem, which consisted of
Elkem Silicon Materials, Elkem Carbon,
Elkem Foundry Products, Elkem Solar
and Elkem Technology.
Technological breakthrough with environmental benefit
Continuous process saves labour
and energy
In 1918, Elkem patented a brilliant
method that freed smelters from having
to cool down the furnaces and stop
production when the electrodes were
exhausted and had to be replaced. This
method is called the Söderberg electrode,
after the electro engineer Carl
Wilhelm Söderberg (1876-1955), who
had the original idea. The invention led
Elkem to become a worldwide technology
company. Even today, approximately
75 per cent of all smelters and
smelting furnaces worldwide have purchased
the technology and equipment
from Elkem.
Environmental problem becomes
a profitable product
The thick white smoke from the silicon
smelter’s tall factory chimney that some
remember from the 1970s turned out to
be waste of the worst kind: The smoke
contained a profitable product with fantastic
characteristics. Elkem Microsilica ®
is an emissions problem that was turned
into a profitable product with good
environmental characteristics. Elkem
developed the cleaning process and
identified uses for the silicon dust. In
the 1970s, Elkem worked to install the
filter technology everywhere quartz was
converted into ferrosilicon and silicon.
Later, the authorities made cleaning a
statutory requirement.
Even smaller CO 2 footprint for
electricity from solar panels
Elkem Solar, which was established in
2009, produces super-pure silicon for
the solar panel industry. This product,
ESS, uses a quarter of the energy
consumed by its competitors. Ongoing
development will reduce energy
consumption further. This makes solar
energy cheaper to produce and makes
solar power even more climate friendly.
Independent tests also show that
ESS produces more electricity than
competing materials under conditions
characterised by high temperatures and
direct sunlight.
Elkem’s sustainability report 2012 37

Chairman of the board
Investing in a sustainable future
During 2012 Elkem has
invested heavily in new
technology that will prepare
us for sustainable growth in
the decades to come.
We have finished the new energy recovery
facility at Chicoutimi in Canada, the
existing facility in Thamshavn has been
upgraded, and we are considering a
1 billion NOK investment in energy
recovery at Elkem Salten in Norway. If
realized, the Salten facility will recover
more than 300 GWh of electricity
annually.
We have an ongoing project that will
make it possible to reduce the amount
of dust particles inside the plants. In
the 1970s Elkem successfully developed
a filter technology that captures
the dust from the chimneys. This gave
us the profitable product microsilica.
After many years of research it is clear
that the fugitive emissions from the
process may have a negative effect on
the lung capacity of the workers. We
have established a close cooperation
with the Norwegian authorities and will
start implementing measures to reduce
the amount of dust, and at the same
time introduce technology that will save
operating cost.
At Elkem Salten in Norway, we have
rebuilt the old ferrosilicon furnace into a
first class and unique furnace producing
Si99. This will enhance the economy
of the plant, but it will also reduce the
emissions of NO X . The new furnace
will be operated on the basis of new
scientific results developed by an Elkem
employee to minimize the generation
of NO X . This technology will most likely
turn into mandatory regulation for other
actors of our global industry in the years
to come, based on the EUs principle of
Best Available Technology (BAT).
All such projects competes with other
investments necessary to secure the
future growth of the company, but projects
that enhance net energy efficiency,
reduce waste and negative effect on
both people and the environment will
always prevail.
Elkem’s most important market is
Europe, which is affected by the five
year long downturn of the economy.
Part of our efforts to strengthen the
company is a successful penetration of
other faster growing markets, especially
in Asia. This is particularly important
for Elkem Solar, which has developed
the unique product ESS for the solar
industry. ESS is produced with a fraction
of the energy necessary to produce
standard polysilicon, and the energy
efficiency of the process will increase
further. Independent tests done in India
also show that solar panels based on
ESS produce more electricity than
panels based on standard polysilicon
under conditions characterized by direct
solar radiation and high temperatures.
This is of course of great importance
and will further enhance the prospect for
ESS.
During the last two years the growth of
the solar market has slowed down, but it
is still growing, and the growth will pick
up in order to meet the need for new
energy solutions. I am confident that we
will soon find a strategic position that
will secure growth and a strong position
for Elkem Solar.
I am especially pleased to note that we
have been able to cooperate within the
Bluestar company and secure a transferring
of best practices and competencies
from Elkem to other units. A group
of high-skilled employees from Elkem
have been working with colleagues at
Bluestar’s silicon plant at Yongdeng for
two years now. I am happy to say that
there have been great improvements
achieved in both operational and environmental
standards at Yongdeng.
Another important co-operation project
is the streamlining of the production
of silicone in our two French plants in
Roussillion using silicon from Elkem’s
Norwegian plants as input. The project
is called BluElco and is also based on
Elkem Business System (EBS). This
project will go on until 2014.
The Elkem Business System (EBS) has
been key in developing Elkem into a
world class producer of silicon materials.
EBS is a tool for human resourcing
as well as for achieving operational
excellence and reducing emissions and
waste of all kinds. This is a good way of
developing a company and in a broader
context its principles should be part of a
policy for a more sustainable world.
Robert Lu
Chairman of the Board and CEO of
China National Bluestar Group Co
38
Elkem’s sustainability report 2012

Editor: Daniel Ingebricson, communications adviser Elkem
Text and project management: Stakeholder AS
Design: F’design
Photos: Photographer Nicolas Tourrenc /Elkem archives/ Aptum

Contact information
Visiting address:
ELKEM AS
Hoffsveien 65 B,
Oslo, Norway
Postal address:
ELKEM AS
P.O. Box 5211 Majorstuen
NO-0303 Oslo, Norway
Tel + 47 22 45 01 00
Fax + 47 22 45 01 55
info@elkem.no
www.elkem.com