The World Today – Victorian power deal locks in decades of brown coal use 02/03/2010

ELEANOR HALL: Two of Victoria’s biggest energy users have signed a deal that will guarantee the state’s reliance on brown coal fired electricity for decades.

The state’s largest exporter, Alcoa, has signed a deal with the Loy Yang Power Station, to supply electricity for its aluminium smelters until 2036.

The Victorian Government says it had nothing to do with the deal, but Green groups say they are not convinced and that it's insane to lock in such a polluting power supply now.

Kellie Lazzaro reports…

MARK WAKEHAM: I fear that this is a signal that they want to continue operating for another 25 years but it’s actually a bargaining chip in the broader play about compensation under an emissions trading scheme.

If they can present this contract as something that’s set in stone then Loy Yang’s future operations are affected when we do get serious about climate change. I wonder whether there’s going to be a very big ask on the taxpayer’s dollar in the form of compensation…

via The World Today – Victorian power deal locks in decades of brown coal use 02/03/2010.