Smelter faces closure under ETS

The true dangers of being a “world leader” instead of moving in pace with our major trading partners was exposed yesterday as the owners of the Tiwai Point aluminium smelter near Invercargill announced they would move to close the smelter if the Emissions Trading Scheme is passed in its present form.

The plant is the largest employer in Southland and its closure would result in more “not bad news” with an estimated 3,000 job losses.

Now some would say that is the price Southlanders must pay, to help the environment.

But here is the madness. It would merely reopen it in China – which is not affected by Kyoto. So there would be no reduction in emissions – in fact an increase as the China plant would be less “clean” than the one in NZ which is one of the cleanest and greenest smelters in the world. The owners say the Tiwai Point smelter would be the first in the world to face such costs due to an ETS.

The Herald reports on what the owners would like:

Mr Deacon said it was to replace the arbitrary straight-line phase-out of free allocation of emissions units from 2018 by a series of reviews that would only discontinue that protection for trade-exposed industries when their international competitors faced a comparable carbon price.

In other words don’t tax our industries into the ground so they move to a country which are not paying a price for carbon. This has nil environmental impact then, and a negative economic impact. Kyoto excludes countries like China – the world’s largest emitter.

If the Government proceeds with the ETS without changes, and Tiwai Point is put on a path to closure, it will devastate Invercargill and Southland.