Gladstone could be a ‘model’ for sustainable heavy industry
WITH Boyne Smelters Limited consuming the most power in Queensland, a new report has examined how the industrial giants of the Gladstone region could be a model for sustainable growth.
The demand for electricity by Gladstone’s industry is a key focus of the Institute of Energy Economics and Financial Analysis report by Clark Butler
“Sustainable heavy industry is a key opportunity for investment, jobs and growth,” Mr Butler said.
“With the aluminium sector failing, now is the time to reimagine Australian industry and to put it on a path to sustainability.
“By focusing on large scale, low cost of capital, zero-emissions renewable infrastructure tied to significant energy users with long-term growth prospects in a low-carbon economy, there is a real chance to build momentum.”
The cost of electricity is putting the future of the aluminium industry in jeopardy, Mr Butler claims, and Boyne Smelters Limited is Queensland’s biggest power consumer.
“About 4500 jobs are vulnerable if the Gladstone region’s heavy industry cannot compete internationally,” he said.
Mr Butler said Australia’s aluminium sector was losing money and considering closure.
Coupled with the huge power consumption, Mr Butler said was the fact Australia’s aluminium industry was a large polluter.
“This failure is linked to their enormous electricity demand which has historically been tied to Australia’s largely fossil fuel-based electricity generation,” he said.
“But instead of closing the smelters, the aluminium sector could move to low-cost, zero-emissions electricity and invest in plant upgrades to support demand response management, and profit from the long-term growth by value-adding in metals and industrial processing markets.”
In the report, Mr Butler found that if electricity could be generated and delivered to Gladstone at $40 to $50 per megawatt hour, this would support increased export competitiveness and jobs growth, not just in aluminium but in all of Gladstone’s heavy industry sectors, including cement and help establish a the platform for a new green hydrogen industry.
“Gladstone has four major hydrogen projects in the planning stages and has a number of competitive advantages when it comes to developing a green hydrogen industry – world class solar energy, available land, a major export port and an established energy exports industry,” said Mr Butler.
“It is also well located geographically to supply green hydrogen to potential hydrogen importing countries such as China, Japan, South Korea and Singapore.”
The report details a number of strong reasons for focusing on transforming Gladstone now.
“COVID-19 has focused attention on investment for recovery, and supply chain security is a key theme,” Mr Butler said.
“Also, the Queensland government will be establishing three renewable energy zones which creates an opportunity to repower the region’s key heavy industries at sustainably lower cost.
“Finally, aluminium is one of several foundational industries that could fail or prosper depending on electricity costs.
“Manufacturing has already taken a heavy blow from high electricity costs in Australia.”
Mr Butler said the Gladstone plan could be a template for expansion across the aluminium sector, and was also applicable in Victoria and New South Wales.