Jobs fear after Bell Bay aluminium smelter posts $25 million loss

The Bell Bay aluminium producer has reported a big loss for 2013 after warning it would have to reduce staff unless it was exempted from the Renew­able Energy Target.

Rio Tinto Aluminium (Bell Bay), holder of the investment in the Bell Bay smelter, reported a $25 million loss for 2013.

The result, a $36 million loss offset by a $10.9 million income tax benefit, follows a profit of $15.5 million in 2012.

The smelter employs about 500 people directly and another 500 indirectly.

Its principal activity, known as tolling, is to produce aluminium for associated company Pacific Aluminium Bell Bay Sales. Tolling revenue sank from $386 million in 2012 to $290 million in 2013 because of low aluminium prices and the strong Australian dollar.

Last week the smelter’s general manager, Ray Mostogl, made a submission to the Federal Government’s review of the Renewable Energy Target saying that it cost the company $8 million a year.

Mr Mostogl said the company could not afford that because of low aluminium prices.

“Manufacturing aluminium is highly electricity intensive and, as such, is very exposed to the cost of the Renewable Energy Target. Indeed, even after the current partial exemption the RET still costs [Bell Bay Aluminium] around $8 million per annum,’’ he said.

A panel is reviewing the ­requirement for 20 per cent of electricity to be generated by renewable sources by 2020.

Mr Mostogl urged the ­panel to support a full exemption for the industry, saying his company had already been actively reducing its workforce.