Tasmanian companies accused of exaggerating RET costs

The large Tasmanian industrial firms complaining about the Renewable Energy Target (RET) are wrong and the scheme is actually good for the state, according to a report.

The report by the Australia Institute found that, under the RET, Tasmania generated about $125 million in renewable energy certificates in 2013, while costs from consumers were about $22.5 million.

As such, the report said, the RET delivers Tasmania a net benefit of around $100 million a year.

Bell Bay Aluminium, Grange Resources, Norske Skog and Nyrstar are four of Tasmania’s largest industrial firms, trading in aluminium, iron ore, newsprint and zinc, respectively.

The four companies have claimed that the RET deals a $20 million per annum blow to their combined productivity.

Matt Grudnoff, a Senior Economist at the Australia Institute and author of the report, rejected the claim and said they ignore the assistance afforded to the industry under the RET scheme.

“All four of these industrial firms receive assistance in the form of Partial Exemption Certificates, which entitle a firm’s energy supplier to be exempt from the cost of the RET, he said in a statement.

“RET assistance significantly offsets the pressure placed on industrial firms by the introduction of the RET. While rates vary annually, in 2014, Partial Exemption Certificates have covered 40 – 67 per cent of electricity costs for these businesses.”

The report finds that, when included in the big picture, this assistance more than halves the cost of RET claimed by the industrial firms. It finds the $20 million dollar claim to be bogus, with even a generous estimation of combined costs being more like $8.5 million per year for Tasmania’s large industrial firms.

According to the ABC, The head of the Tasmanian Minerals Council, Ray Mostogl, rejected the Australia Institute report and called for a 100 per cent exemption.

"There is no smoke and mirrors in RET costs, they are simply a function of electricity consumption and partial exemptions," he said in a statement.

"The continuation of RET costs must be absorbed by these businesses at a time when industry can least afford it."

Meanwhile, Sky News reports that Greens leader Christine Milne has requested meetings this week with crossbench senators Jacqui Lambie, Nick Xenophon and Ricky Muir to try and save the RET in its current form.

The Federal Government wants to cut the RET from 41,000 gigawatt hours to about 27,000. Given that projected energy is expected to drop, it claims the figure is a ‘true’ 20 per cent target.

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