Australia energy target will cost thousands of aluminium jobs

Australia’s aluminium industry said that the Federal Government’s renewable energy target will cost it USD 700 million over the first decade of the scheme and threaten 5000 jobs in regional centers. In a submission to the Senate inquiry into the Government’s renewable energy legislation, seen by Business Day, the Australian Aluminium Council called for a true 90% exemption from the full costs of the RET. Under the Government’s proposal, Australia will have to source 20% of its electricity from renewable sources by 2020, equivalent to 45,000 GWH. The big polluters, which are deemed to be at a disadvantage to international competitors operating without an emissions trading scheme will be exempt from using renewable energy above a target of 9500 GWH. But the aluminium industry, which consumes about 15% of Australia’s electricity and contributes more than USD 5 billion to Australia’s exports each year, said that it will need to slash capital expenditure and jobs to meet the combined cost of the RET and the carbon pollution reduction scheme, estimated by the industry to cost it USD 4 billion over the first 10 years. The council said that ‘‘Each of Australia’s aluminium smelters spends in the order of USD 50 million annually on sustaining capital. Faced with additional RET costs, much of this local spend on regional employment, equipment and supplies will evaporate.” It said that ‘‘The RET bill does not provide a 90% exemption from RET to any industry due to the extension of original mandatory renewable energy target liabilities. The exemption figure for aluminium smelting is actually 55%.’’ The council said that a true 90% exemption would protect jobs, particularly those at the 6 regional smelters in Portland, Geelong, Hunter Valley, Tamar Valley and Gladstone which employ 5000 people. It said that ‘‘the alumina and aluminium industry accepts that Government intervention is justified in response to climate change. The position we have advocated would see additional costs of USD 1.3 billion imposed on the Australian alumina and aluminium industries over the first 10 years. ‘If un amended, this bill will have significant economic consequences for the aluminium industry.” (Sourced from theage.com)