The RET helped to kill Alcoa’s Port Henry Aluminium Smelter & 980 jobs

Ron Boswell

Ron Boswell: you can have a RET or manufacturing & industry –
you can’t have both.

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Proving Ron Boswell’s statement that: “Australia can have a carbon price and renewable energy targets or viable manufacturing. We can’t have both” – aluminium refiner, Alcoa has just announced that it will pull the plug on its Port Henry smelter near Geelong – with the loss of 980 jobs.

Here’s The Australian on another RET disaster.

Point Henry ‘magnifies RET flaws’
The Australian
Annabel Hepworth
19 February 2014

AUSTRALIA’S aluminium smelters are urging the Abbott government to consider the “disproportionate” impact the Renewable Energy Target is having on their competitiveness.

The Australian can reveal the Australian Aluminium Council has told the Department of Industry’s energy white paper reference panel that the sector has paid more than $300 million in RET costs since it was introduced and “this is not sustainable”.

In a new submission, the council warns that high electricity prices have had “negative market consequences”. It points to Queensland’s Boyne Smelters, which is cutting aluminium production for the first three months of the year because of the high price of electricity over summer.

It also challenges the government to deliver a mechanism to offset the period of higher electricity costs if the carbon tax repeal is delayed after July 1, and to review energy efficiency programs that cost hundreds of thousands of dollars in company resources.

The warnings came as power stations reeled yesterday from Alcoa’s announcement of the Point Henry smelter closure, as it consumed 5.8 per cent of Victoria’s electricity demand.

(Alcoa’s Anglesea brown-coal power station supplies about 40 per cent of the power used by Point Henry.)

Electricity generators warned the rapidly declining demand for electricity had compounded flaws in the design of the carbon tax and the RET. National Generators Forum executive director Tim Reardon said: “The closure of the Point Henry smelter will magnify these. The closure also means that there are fewer customers paying for the cost of poles and wires and . . . the cost of networks to remaining customers will increase.”

EnergyAustralia, which owns the Yallourn power station in Victoria’s Latrobe Valley, said the Point Henry closure would have a “significant” impact. “The closure will exacerbate the oversupply of generation and place further financial pressure on Victorian electricity generators,” said group executive manager of strategy and corporate affairs, Clare Savage.

Alcoa has applied for an electricity-generation licence for Anglesea power station and The Australian has learned of industry concerns if it remains operational when Point Henry is closed it could add to the oversupply.

Alcoa has said it needed to get a generator’s licence for Anglesea to continue to supply electricity to Point Henry or to the grid when a long-term contract with the State Electricity Commission of Victoria expired on July 31.

The NGF says demand has declined since 2008 and at up to 3 per cent a year. Were it to continue at the rate of the past four years, emissions from power generation would be 5 per cent below 2000 levels by 2017-18 without government interventions via the RET or the Coalition’s direct action plan.

In a submission on the emissions reduction fund the NGF warns the oversupply of generation “limits the ability of all market participants, including renewable generators, to achieve a commercial return”.
The Australian

port henry smelter

Victims of the RET.

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Meanwhile, the Coalition are lining up the scrap the RET outright.

Coalition MPs push to halt subsidies for renewables
The Australian
Sid Maher
19 February 2014

TONY Abbott will face internal pressure to call a halt to subsidies for new renewable energy investments after the review of the government’s Renewable Energy Target reports in the middle of the year.

While some senior MPs believe the scheme should be largely maintained with the 41,000GW/h target pushed back to lower the scheme’s impact on electricity prices, others want the government to go much further.

One MP yesterday told The Australian that existing renewable energy investments should be “grandfathered” but there should be no support for new investments.

The RET adds between 3 and 5 per cent to the cost of household electricity bills, but opponents of the scheme argue the costs are higher for commercial users. Figures provided to The Australian say the RET adds between 10 and 13 per cent to the electricity costs of businesses who have discounted agreements with electricity retailers.

Environment Minister Greg Hunt and Industry Minister Ian Macfarlane on Monday announced a RET review panel to be headed by former Reserve Bank board member Dick Warburton.

Labor yesterday seized on Mr Warburton’s appointment as evidence of the government’s “lack of commitment to a clean energy future for Australia”.

“Mr Warburton has previously stated he does not accept the science of climate change and has today confirmed his scepticism of the contribution of human activity to climate change,” opposition climate change spokesman Mark Butler said.

“How can Mr Warburton be objective in his analysis of the renewable energy sector if he does not think climate change has any connection with emissions from burning fossil fuels?”

But Mr Warbuton told the ABC yesterday: “I am not a denier, nor a sceptic actually, of climate change per se. What I am sceptical of is the claims that man-made carbon dioxide is the major cause of global warming. I’m not a denier of that, but I am sceptical of that claim.”

He said he would treat the review with a “completely open mind”.
The Australian

Dick Warburton can be expected to bring a “completely open mind” when it comes to challenging the wild and unsupported claims made by the wind industry about its purported cost competiveness with conventional generation sources and about its unproven claims to abate CO2 emissions in the electricity sector (see our post here).

In a contest that’s squarely between the RET (and the wind industry) on the one hand and manufacturing, mining and industry on the other – with Dick Warburton as the umpire – there really is no contest.

dick-warburton

Dick Warburton – RET Slayer – will always side with real industry.

About stopthesethings

We are a group of citizens concerned about the rapid spread of industrial wind power generation installations across Australia.

Comments

  1. Keith Staff says:

    There is a great opportunity for Australia to learn from the mistakes of others. Just look at the hasty retreat going on in Europe, especially in Germany and the U.K.

    Renewables and the wind energy con trick.

  2. Jackie Rovenksy says:

    Is this RET review looking at the science of climate change? If not then why is his ability to head the review into the RET system in question, especially when he has only expressed a view many
    Australians have – perhaps its just another example of the fear the IWT industry and its supporters are feeling.

Trackbacks

  1. […] It’s the cost impact on power prices of that massive subsidy stream that has energy intensive industries – like aluminium processing and mining – lining up to ensure that the mandatory RET gets scrapped now (see our posts here and here). If the RET is retained, expect to see more industrial outfits close their doors, killing off real jobs in the thousands (see our posts here and here). […]

  2. […] Back in February, Alcoa announced it was shutting its Point Henry smelter (in Victoria) with the loss of 980 jobs. Alcoa made no bones about it: the mandatory RET is having a “disproportionate” impact on the Aluminium industry and is (unnecessarily) adding to the competitive pressures faced (see our post here). […]

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