“The Albanese government’s bailout of the Tomago Aluminium Smelter is a damning indictment of the government’s net zero agenda, and further proof that we can’t have a future made in Australia with net zero,” said Saxon Davidson, Research Fellow at the Institute of Public Affairs.
It was announced today that the Tomago Aluminium Smelter has been granted a $2.5 billion bail out to ensure that it stays operational until 2038. This is a joint bailout from the Albanese and Minns governments.
“This is a clear admission that Australian manufacturing cannot survive the renewable transition.”
“To have a thriving manufacturing base in Australia we must have affordable power prices and a reliable supply of energy, both these things are put at risk by the policy of net zero.”
The Safeguard Mechanism is the federal government’s marquee net zero policy that mandates large projects and facilities to reduce their emissions or purchase carbon credits to continue to operate. Previous IPA research found that facilities will incur a safeguard carbon tax cost between $7.1 billion and $11.7 billion by 2029-30.
Using the same methodology, the IPA calculates that the Tomago Aluminium Smelter faces a safeguard tax cost of up to $114 million to 2029-30.
“The Safeguard Mechanism is a danger to our sovereign capability, as almost nine-in-ten of all the facilities targeted are in critical industries we need to survive as a self-reliant nation, including mining and manufacturing,” Mr Davidson said.
“While a carbon tax of $114 million is significant, it is only one cost the smelter incurs on top of ever-expanding red tape, emission reduction requirements, and net zero caused rising power prices.”
While the Safeguard Mechanism is a direct burden on our sovereign capability, the underlying policy of net zero is the catalyst for Australia’s decline.
“You can’t have a future made in Australia with net zero, and if the government really supported manufacturing jobs, they would admit their net zero failure and dump the policy.”
“Australia must be a country that takes advantage of our natural resources and services the needs of our country first, this means abandoning emission reduction targets set by global conferences.”
To download the IPA’s research on the Safeguard Mechanism click here.
