The Corporate Business Case for Recycling 17 May,

A Word About Alcoa in Ohio! Approximately 1700 employees, most in Alcoa’s EPS Group  AFE Cleveland Works  APP’s Howmet  Tempcraft (Cleveland)  AWTP: Cleveland, Barberton and Chillicothe  Independence Business Unit HQ office Cleveland works celebrated 55 th operational anniversary Major recycling investment announced at Barberton Investment in community recycling initiatives 2 Alcoa invested in public space recycling bins at Cleveland-Hopkins Intl.

Key Global Megatrends Are Shaping The Future Population Growth Urbanization Environment 3 Energy consumption rising  Increase of 54% by 2025  Driven by developing countries Personal transport rising  Increase of 40% by 2030 Greenhouse gas regulation Global population rising  2006: 6.6 billion  2025: 7.9 billion  2050: 9.1 billion Population in cities  2006: > 50%  2030: > 60%

Miracle Metal - Unique Value For Diverse Applications Lightweight Recyclable Non corrosive Fuel efficient Durable High strength Highly conductive Malleable 4

Recycling is a core strategic imperative 5 Alcoa Wheels Alcoa Consumer Electronics Alcoa Aluminum Packaging

 Increase payload by 3%  Save per year:  $1.3M in maintenance  $120K in fuel costs  $100K in tire costs  Capture $5.3M in residual value Product Innovation Continuing To Reinvent The Wheel Wheel Torque Solutions Dura-Flange® Dura-Bright® Calculighter™ LvL ONE™ Dura-Bright® XBR On a fleet of 3,000 trucks, aluminum wheels would: 6

Our Latest Reinvention – Wheel Recycling in Ohio! $21mm Barberton Green Expansion adds advanced recycling and casting to reduce energy consumption and GHG 30 new full-time jobs and supports 350 existing positions First of its kind in NA; uses innovative new technology to produce billet for new wheels from re-melted scrap aluminum 7

8 Infinite Recyclability Surface Finish Attributes High Strength Formability Thermal Management Light Weight The Alcoa Aluminum Proposition Aluminum: Making Consumer Electronics “Cool” and Recyclable “The MacBook Pro starts life as a single piece of aluminum… the breakthrough aluminum unibody” “Sony’s Kindle Competition-- The Daily Edition--Boasts Attractive Aluminum Body” “Tablet sales on the rise, led by Apple’s aluminum-backed iPad” “Scary good looks for Nokia N8 thanks to aluminum” “Amazon uses aluminum in newest Kindle making it thinnest, lightest, most affordable” “HP ProBook 4520s gives business professionals aluminum good looks, durability”

Leveraging Aluminum’s Recyclability in a Growing Market New EcoWise TM product offers high recycled content without sacrificing surface finish or strength demands of competitive industry Addresses growing concerns about E- Waste issue by closing the loop 9

Alcoa’s Investment in ERI 10 ERI has largest E-Waste shredding and recycling system in the world. R2, E-Steward certified; BAN Founder 10% Alcoa stake in the company – investment in CE product responsibility

ERI’s Expanding National E-Waste Recycling Network 11

Aluminum Packaging - Sustainability Driven by Recycling Beverage Can Light Weighting (ounces per can) 12 Less material means less weight, less fuel, less waste… creating less impact. Aluminum cans have the highest recycled content and recycling rate Aluminum: True Green Infinitely recyclable – back on store shelf in only 60 days Today’s aluminum can is  40% lower GHG  30% less energy  15% lighter-than in 1993 Alcoa certified Cradle to Cradle

Background: Global Recycling Rates 13 Source: IAI

So - What is the Problem? 14 U.S.: 97 billion ROW: 99 billion Half the world’s cans are consumed in the U.S., yet 42% of them are still going into the trash We have the largest market for these cans, but one of the lowest recycling rates among developed countries. The result? About 1.3 billion lbs or 575 KMT of metal with a strong market is being buried in U.S. landfills  Equivalent of 2 smelters are buried in U.S. landfills  Equivalent of >27,000 Airbus A320s… In Ohio – 4.2 billion cans used  88mm lbs - Almost 3 billion trashed  Equivalent to 1875 Airbus A320s  $48-50mm Total Market – 196 billion 41 billion trashed ~70% recycled

Meanwhile, the nearby aluminum industry is short of cans! 15

Recycling = Jobs! 16 Export Source: Container Recycling Institute FLOW CHART: DOMESTIC LABOR (USA) DIRECTLY RELATED TO COLLECTION OF BEVERAGE CONTAINERS FOR RECYCLING AND DISPOSAL

Recycling = Jobs! 17 CRI’s recent study supports a view that up to 7 FTE in collection jobs are created per 1000 mt of beverage container material alone. Aluminum Association estimates recycling jobs would increase to > 100 if 75% rate achieved. Tellus Institute Report – 2.3mm jobs created at a 75% recycling rate. Source: Container Recycling Institute

Industry Collaboration Outreach and Education  Social shift campaign - KAB  CVP -  SERDC  Alcoa Foundation Grants Policy – Policy – Policy  Must drive change to provide necessary incentive 18 “…unprecedented industry event. Nothing like this has been organized before.” “I am impressed with how much you have accomplished in such a short period.” What can be done to create step change improvement?

What can be done? Policy support is imperative  Disposal bans  Mandated or incentivized recycling/enhanced incentives  PAYT  EPR? Not clear what EPR for packaging means

NC Plastic Bottle Recovery Rate NC Plastic Recovery Rate – since passage of disposal ban… NC Division of Environmental Assistance & Outreach

PAYT Effects 21  Demonstrated in cities  DOUBLES recycling  Diverts 1/5-1/6 from landfill!  Most effective strategy 3x more effective than dozens of other program options assessed)  Strong job creation (13:1) YW Recy Source Red’n (SR) 3 PAYT effects Source for graphs and figures: Skumatz Economic Research Associates, © all rights reserved; jobs data computed using ILSR data.

Let’s make aluminum recycling as automatic as fastening a seatbelt!