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posted on:
February
17
2016

Alcoa considers closure of Portland smelter

 

Source: The Age, 17 February 2016


Alcoa's Portland smelter risks closure and a mass shedding of jobs, with the aluminum plant now running at a loss and facing a huge surge in costs later this year.


Analysts estimate the smelter's power costs will rise by about $50 million to $90 million as a government subsidy is removed and a new power contract starts with AGL in November.


The smelter is responsible for almost 10 per cent of Victoria's electricity demand.

Analysts at UBS, in a separate report, have suggested AGL could stand to lose at least $18 million in a year if the smelter shut.


Environment Victoria chief executive Mark Wakeham said any support should be short-term and dependent on the smelter's move to cleaner energy sources than brown coal power from Loy Yang. He said Western Victoria more broadly needed a plan for new jobs, which could be delivered via the Andrews government's upcoming renewable energy plan.


A spokesman for Victorian Treasurer Tim Pallas said its focus was on supporting jobs. "We will continue to engage positively with Alcoa to ensure the best possible outcome for Portland."


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