A major Illawarra polluter says its annual carbon tax bill is likely to be double what it originally thought, possibly threatening feasibility studies for new projects.
Illawarra Coke Company expects its annual carbon liability to be more than $500,000 per year rather than the $200,000 to $250,000 it had predicted earlier.
Managing director Rex Wright said the difference emerged due to the complex nature of the formula used to calculate assistance for high-emissions industries such as coke making.
‘‘It takes away our ability to fund projects and do other things within our business because we have to find another quarter of a million dollars which purely comes off your bottom line,’’ he said.
As a trade-exposed company, Illawarra Coke is eligible for assistance to cover 94.5 per cent of the industry-average carbon costs in the first year of the tax.
But without further government grants or funds, the 100-year-old cokemaker might not be able to afford feasibility studies for projects that could help reduce its carbon footprint, Mr Wright said.
The company wanted to conduct studies into power generation using waste heat from its coke ovens as well as options to reduce moisture in the coal it used to increase yields, he said.
It had scheduled a meeting with the Department of Industry, Innovation, Science and Research to see if any possibilities existed to help fund the studies, which could cost about $100,000 to $150,000.
One project would look at co-generation technology using heat from the coke-making process to generate electricity, potentially reducing costs and allowing the company to sell power back to the grid.
‘‘They’ve given money to the steel industry ... they’ve also given money to the coal industry and we’re saying ... are there any funds around that we might be able to tap into to help us with these sorts of things,’’ he said.
BlueScope Steel and a number of the region’s coalminers will receive significant assistance to adjust to carbon pricing.
Illawarra Coke produces about 170,000 tonnes of emissions each year and employs about 50 people at its facilities in Corrimal and Coalcliff.
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