The future of Victoria’s Portland aluminium smelter has been secured – and around 500 jobs secured – after an electricity deal was struck with the nation’s biggest energy retailers. This is in addition to support pledged by the Federal Government in December.
Friday’s announcement that Alcoa will keep the smelter operating until 2026 will also protect many other jobs in the region that rely on the plant’s continued operation. The smelter accounts for 14 percent of jobs in the Portland area, which is around 300km from Melbourne.
The prospects for the Portland smelter had looked grim since October 2019, when Alcoa launched a program to close smelters that were financially and environmentally uncompetitive.
Participation in scheme to stabilise state’s power grid
The Government will provide up to $76.8-million over four years to secure Portland’s participation in the Reliability and Emergency Reserve Trader (RERT) scheme. The scheme supports the state’s power grid at times of peak demand.
Under the agreement, the Alcoa-operated facility will reduce its energy demand at peak times, making more electricity available to the grid and helping Victoria avoid blackouts. Alcoa is compensated for the reliability services it provides to avoid shutdowns.
Prime Minister Scott Morrison said the announcement was welcome news not only for the 500 local employees and the region, but also for the Victorian electricity system.
Shows confidence in the country’s post-Covid economy
“Our support means keeping jobs and keeping the lights on,” the Prime Minister said. “This demonstrates the real confidence that industry, manufacturers and businesses have in Australia as we emerge from Covid-19.”
Morrison said the Government’s support for Portland recognises its important position, not just as a large employer and key manufacturer, but also for its vital role in keeping the lights on in Victoria.
He added that the number one focus of the National Economic Recovery Plan is jobs and it was important to secure jobs like those at Portland and create new ones.
Portland plant is state’s largest consumer of electricity
Minister for Energy and Emissions Reduction, Angus Taylor, said the agreement between the Commonwealth and Alcoa recognised the smelter’s important role in helping to stabilise the state’s electricity network and the jobs it supports.
“The Portland smelter is Victoria’s largest energy consumer and provides unique and valuable energy services to the grid” Taylor stated.
The facility accounts for around 10 percent of the state’s electricity demand each year and produces almost 20 percent of the nation’s aluminium output.