INDEPENDENT NEWS

Pull The Plug On Corporate Welfare

Published: Wed 3 Oct 2007 09:37 AM
Chief Reporter
Tiwai Point Smelter: Pull The Plug On Corporate Welfare
Just when longsuffering domestic power consumers were asking: “How much longer do we have to go on subsidising one of the biggest transnational corporations in the world, which gets the biggest single chunk of NZ’s electricity at a secret rock bottom price while our power bills keep going up?”, we get the answer – at least until the end of 2030. That is the end year for the latest power price contract just signed by Rio Tinto Aluminium NZ (much better known by its former name, Comalco) and Meridian Energy.
Like all the Tiwai Point aluminium smelter’s previous power price contracts, over nearly 40 years, this one is top secret. The current contract price is estimated to be 4.7 cents per unit, or ¼ of the power price to the average home. And, as it always has done, the company issued threats in case it didn’t get what it wanted – this time it threatened to produce its own power from a coal fired station (just what NZ needs, another coal fired power station). It needn’t have worried, as Meridian has followed a long and dishonourable tradition, dating back to the NZ Electricity Department, of giving this transnational corporate bludger what it wants. It has run rings around all Governments, whether National or Labour.
This one smelter uses around 15% of all NZ’s electricity, 24/7. In 2006, Rio Tinto Aluminium NZ made a $277 million dollar profit, double what it made the year before. Why is the NZ public subsidising this transnational, owned by one of the world’s biggest (and nastiest) mining companies? Why are we allowing 1/6th of our total electricity to be dedicated to this one enterprise?
At the very least, charge it the going rate. It can definitely afford it, particularly when it’s being subsidised by everybody else (the Rogernauts seem to be conspicuously silent about the country’s biggest welfare recipient). Even better, shut it down and free up that massive block of electricity for something rather more useful. More than once the company has threatened to pack up and leave, if it doesn’t get its own way. CAFCA says: be our guest and don’t forget to turn off the light when you go, as you’ve wasted enough of our power already.
ends

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