Editorial by Barry Prismall
The Bell Bay power deal is a solid outcome for Tasmania.
Cynics have questioned the need to provide energy incentives for major industrial clients, but the notion of public incentives to attract and retain our manufacturing base is a fact of life across Australia.
Critics have always accused Tasmanian governments of providing cross subsidies for major companies, at the expense of individual and small business power consumers. Tariffs as low as 2.5¢ per unit have been mentioned. That certainly was the case with Comalco at Bell Bay in the 1990s.
The state government has facilitated a deal between Hydro Tasmania, TasNetworks and Bell Bay Aluminium to deliver an extra 33 megawatts of power to the smelter. It underpins more than 1500 jobs.
The commercial arrangement increases the amount of power to the smelter by around 10 per cent, allowing Bell Bay Aluminium to increase production.
In return the company will embark on a $30 million investment program, around half of which will be spent with local suppliers and contractors.
Tasmania's future includes a growing element of small, niche marketing commerce such as wineries and tourist functions and accommodation. It's getting bigger as the state moves from an economy based solely on resource sectors such as forestry.
But the trend won't replace the manufacturing sector in the medium term. Tasmania has a vibrant future in mining, manufacturing and a reconfigured forest industry. It is not something we can afford to replace. The alternative is nowhere near the panacea stage.
The critics should bear this in mind. We have an exciting clean, green future. We also have a thriving manufacturing sector and currently we need it all.
When the clean, green niche markets are able to fill the vacuum left by manufacturing, then we'll sit up and take notice of a major employment transformation under way.