Australia’s position as the world’s sixth-largest aluminium producer could be put at risk by a shift to nuclear power due to higher energy prices and lower generation.

Three out of Australia’s four aluminium smelters would be “at severe risk of closure” under the change in energy policy which could affect thousands of jobs, a study warns.

A group of more than 70 organisations under the banner of Renew Australia for All released the report on Tuesday, analysing modelling conducted by Frontier Economics for the coalition.

The federal opposition has pledged to develop seven nuclear power plants in five states if it wins government, which its modelling indicated could cost 44 per cent less than Labor’s renewable energy plan.

But an examination of that modelling, conducted by Springmount Advisory, found it assumed industrial energy use would drop by 15 per cent in 2028 and 50 per cent by 2035, leaving little energy to power aluminium smelters.

Australia produces aluminium at facilities in Tomago in NSW, Gladstone in Queensland, Portland in Victoria, and Bell Bay in Tasmania.

While the Tasmanian plant relies on hydro-electricity, the other three smelters use electricity from coal-fired power stations, with the Queensland plant’s agreement due to expire in 2029 and the NSW plant’s contract ending in 2028.

The gap between these contracts and the arrival of nuclear energy could be many years, the study found.

Findings from the CSIRO’s GenCost report indicated nuclear energy could cost significantly more than aluminium producers could absorb.

The four aluminium smelters employed 7594 people directly, the report found, in addition to another 5886 people indirectly.

The loss of on-shore aluminium production and jobs could hit the local economy hard at a time of global uncertainty, Australian Council of Trade Unions president Michele O’Neil said.

“This new analysis has confirmed the real price of this policy – that nuclear power is not just expensive, but it puts at risk a critical industry and the well-paid jobs of thousands of Australians,” she said.

“It is reckless and dangerous to put such a critical industry at risk to pursue an expensive nuclear pipe dream.”

Climate Energy Finance founder Tim Buckley said adopting nuclear power would also force Australian industries to rely on coal-powered electricity and gas for longer and could undermine existing investments in renewable energy projects.

“This will further erode our manufacturing sector’s competitiveness,” he said.

The coalition policy has claimed small nuclear power plants could be operating by 2035, and Australia’s first large reactor could be working by 2037.

The policy has faced strong opposition in recent days, with Christian and Muslim leaders protesting against nuclear policies in Brisbane on Tuesday, and an open letter against nuclear power issued on Sunday by a group of 60 economists.

Coalition campaign spokesman James Paterson said claims about its nuclear policy, including cost estimates exceeding $600 billion, were “dishonest” and misleading.

“We think our nuclear plan is a better plan, but there’s no question Labor is running a scare campaign on that,” he said.

Jennifer Dudley-Nicholson
(Australian Associated Press)