The London Metal Exchange (LME) had announced a register to digitally store the sustainability credentials and other characteristics of metals trading on its platform. This begins with the energy-intensive aluminium. The register is known as the LME passport. It will transfer Certificates of Analysis, based on a metal’s size, shape, purity etc. main thing here is the change from the traditional paper method to a digital system.
Users are allowed to disclose information on Environmental, Social and Governance credentials, including carbon footprint, water use and social impact. Aluminium is particularly energy intensive, which means that it has a high carbon footprint. In the auto sector, it is valued for being lighter than steel. And so, it can allow cars to burn less fuel, as it is infinitely recyclable.
The LME said that the aluminium producers will be able to use the register from Oct. 1. The other metal producers will follow from Jan. 1. The exchange is also launching a spot trading platform for lower carbon aluminium, which is made using renewable power. Disclosure on the sustainability of LME-listed brands will at first be voluntary. But the LME said that it will liase with the market to monitor take-up, and decide next steps appropriately.