Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search


$225,000 per job annual subsidy at smelter

Government plans $225,000 per job annual subsidy at Aluminium smelter

Protecting Rio Tinto’s Tiwai Point aluminium smelter from the full impacts of the emissions trading scheme will cost New Zealand $225,000 a year for every job at the smelter.

The country’s only specialist carbon market information service, Carbon News (www.carbonnews.co.nz), reports Kent Duston of Wellington-based Autonomic Consulting as saying the subsidy will cost $209 million a year.

“It would be cheaper for the New Zealand taxpayer to pay every single Tiwai Point worker and contractor $200,000 per annum for the rest of their lives to simply stay home," Duston says.

Duston bases his calculation on the $14.13m a year worth of free carbon credits Rio Tinto will get a year under proposed changes to the emissions trading scheme, plus the opportunity cost of using the Manapouri hydro power scheme to power the smelter instead of using it to replace the Huntly coal-fired power station.

He told Carbon News that he did the numbers after hearing Climate Change Issues Minister Nick Smith say during his road-show to set New Zealand’s 2020 emissions reduction target that subsidies were need to protect New Zealand jobs.

Duston said: “Anybody with access to the internet and a pocket calculator could have performed the same calculation, and I’m astounded that nobody has. We keep hearing that it’s jobs, jobs, jobs, but nobody is asking the questions about the cost of those jobs.”

In his submission, Duston says that based on a formula of 1.9 tonnes of carbon dioxide for every tonne of the 330 kilotonnes of finished aluminium the smelter produces each year, the plant has an emissions profile of 627,000 tonnes per annum.

“At the proposed capped price of NZ$25 per tonne, these emissions represent a liability to the smelters’ owners of $15.675 million per annum.

“Under the proposed changes to the ETS, 90 per cent of the emissions units would be given to the smelter free of charge, subsidising its operations by $14.13 mil¬lion per annum courtesy of the New Zealand taxpayer.”

Dustan says that the smelter’s emissions level is artificially low because it gets subsidised electricity from the Manapouri hydro power scheme.

“However, if this electricity were to be diverted to the national grid, the 850MW produced by Manapouri would be sufficient to decommission the coal-burning Huntly power station, which produces up to 15 per cent of New Zealand’s electricity.”

Replacing the emissions-intensive Huntly with Manapouri would result in a net decrease in liabilities to taxpay¬ers of $209 million per annum, made up of the non-payment of the Rio Tinto subsidy ($14 million) and the non-payment of the Huntly subsidy ($195 million),” he said.

“There are 800 staff and 130 contractors employed at Tiwai Point. The Government argues that subsidisation of the carbon emissions for export industries is necessary to protect jobs. However it is obvious that the cost of retaining these jobs is exceptionally high – a stunning $225,000 per job per annum.”


© Scoop Media

Parliament Headlines | Politics Headlines | Regional Headlines

Election Day Results

National won 46% of the vote with Labour on 35.8%. NZ First won 7.5%, with the Greens on 5.8%. ACT held on to Epsom, but failed to get more MPs. The Maori Party were wiped out of Parliament.

There are still special votes to be counted, but clearly National is in the box seat to form the next Government.

The Greens can not contemplate a deal with National. So, Winston Peters will have to make a choice and could back National or a combined Labour/Green coalition. Full preliminary results >>


Lyndon Hood: Election Lists

While the ship of state is listing, so I thought I would make some lists as well. More>>


Targetting: ACC’s Computer-Aided Decision-Making Questioned

University of Otago researchers are warning of the potential pitfalls in government departments using computer-based risk prediction models, as has been recently revealed through a controversial new tool used by the ACC... More>>


From The Hood: The Campaign Strategist’s Lament

"This election is a chance to really work the record of what nine years of National-led government has done to improve the country for everyone. Or will do. Another three years, maybe six. Thirty-three years, tops. You don’t want to risk that, do you? More>>

PSA Report: National Gets An ‘F’ For Health Funding

"Seeing National’s record on health collected in one place is quite sobering - it’s clear that underfunding is having dire consequences on both patients and staff, who are having to do more than ever with less," says Glenn Barclay, PSA national secretary. More>>


Children With Disabilities: Education Crisis Unaddressed

In 2008 IHC lodged its complaint against the on-going failure of New Zealand Governments and the Ministry of Education to ensure that disabled children access a quality education on an equal basis to others in New Zealand schools. More>>

Gordon Campbell: Ten Reasons For Not Voting National

if anyone you know is thinking of voting National in Saturday’s election, there’s still time for an intervention. You owe it to your friends and relations to intercede. Because there’s plenty of evidence on National’s mediocre-to-awful track record over its nine years in power. We can’t afford another three years of drift. More>>


Suffrage Day: PSA National Secretaries Vote For Equal Pay

PSA national secretaries Erin Polaczuk and Glenn Barclay are advance voting for the 2017 election alongside their daughters, with equal pay and fairness in mind on the 124th anniversary of women’s suffrage in New Zealand. More>>


Charge Protests: Dairy Farms Use Same Amount Of Water As 60 Million People

Using Dairy NZ numbers, economist Peter Fraser and agricultural consultant Dr Alison Dewes calculate the water consumption of New Zealand dairy farms is equivalent to the residential use of 60 million people. More>>





Featured InfoPages

Opening the Election