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Reducing the demand for electricity in NSW by 950 megawatts won’t solve all of Bowen’s problems but it will make it easier to close the Eraring Power Station, which will result in a reduction of about 10 million tonnes in our annual carbon footprint.

That prospect may explain the Climate Change Authority chairman’s sanguine response to the Tomago announcement. Tomago had to compete in international markets, Matt Kean wrote in The Australian Financial Review.

China had more than 70 Tomagos, most of which were newer and more efficient. “Any energy-intensive industry is ultimately more likely to be viable where it can access low-cost power,” Kean wrote.

His solution for saving the strategically critical industry is as glib as it is predictable: “more – not less – renewable energy”. Kean might have been able to get away with that lazy answer 15 years ago when the challenges of decarbonisation were less well understood and Chinese foreign policy was in the pragmatic and predictable hands of president Hu Jintao. Yet it should not go unchallenged today.

The warning from Tomago that it will be unable to continue when its current energy contract expires in 2028 should prompt us to take Australia’s industrial future seriously. Bowen’s hopes of turning Australia into a world leader in the production and export of green hydrogen were dashed because private sector developers could not secure supply contracts for renewable energy at the quantity or price they needed.

Now, aluminium smelting has run into the same problem. Tomago’s only chance of surviving is subsidies.

We can no longer deny the glaring truth that while solar may be a viable option for the family caravan, it is no solution to powering the energy-intensive industrial processes we can ill afford to lose.

Tomago consumes as much electricity as a city of a million homes. Power must be supplied around the clock, since the molten aluminium running through the potlines cannot be allowed to cool. The technical challenges of running such an operation on intermittent renewables are immense, the engineering challenge of scaling up overwhelming, and the commercial challenge insurmountable.

Bill Gates’s reassessment of the correct response to climate change has been driven in part by the difficulty of decarbonising emissions-intensive economic sectors. The development of artificial intelligence has made the production of plentiful and inexpensive clean energy a matter of great importance to the tech industry.

In an open memo last week to delegates to the Intergovernmental Panel on Climate Change’s 30th annual conference, Gates called for a “strategic pivot” away from the obsession with near-term emission reduction to the cost-effective improvement of human lives.

“When someone tells you they know how to curb emissions, the first question you should ask is: What’s your plan for cement and steel?” Gates asks rhetorically. He might have added aluminium and hydrogen also. “They’re hard to decarbonise on a global scale because it’s so cheap to make them with fossil fuels.”

Gates has been experimenting with ways to produce firm, or baseload, power using low-carbon technology. His company, TerraPower, is constructing an advanced reactor demonstration project in partnership with GE Hitachi Nuclear Energy in Lincoln County, Wyoming, next to a retiring coal-fired power plant.


It will use a sodium-cooled fast reactor with a continuous output of 345MW, featuring an integrated molten salt energy storage system that can boost production to 500MW when needed, allowing it to manage intermittency from renewables. For Gates, the key to success for such a project is to get rid of what he calls “the green premium”, the cost difference between clean energy and energy from fossil fuels.

Gates publishes data estimating the green premium on concrete to be as much as 131 per cent. The premium for steel is 28 per cent and for jet fuel 317 per cent.

“Sustainable” is an overused and much-abused word. Yet if there is a sustainable solution to climate change, it must come with a green premium of zero or preferably less. Burying the green premium in subsidies, sneakily passing it on to consumers, or rationing power by making it expensive puts us on the fast-track lane to economic doom.

Yet the government’s breezy narrative that renewable energy is practically free refuses to acknowledge the green premium at all. The Gillard government at least conceded that there was an effective carbon price and referred to it as a carbon tax. The recent Productivity Commission report on the path to net zero acknowledges this by showing that there are cheaper ways to abate carbon than, for example, electric cars.

The Treasury recognises this, albeit tucked away in Technical Appendix C of its modelling of the government’s net-zero strategy, disguised as a “marginal abatement incentive”.

Anthony Albanese and Bowen, however, remain inveterate carbon price deniers. They assured us before the 2022 election that increasing the concentration of renewable energy would bring our annual power bills down by $275. Instead, our power bills have risen.

Anthony Albanese announced as recently as January that the $2 billion the Government would pump into supercharging the production of green aluminium would benefit both the economy and the environment.

“It will lower the costs and make them (the smelters) more competitive and ensure that these high-value jobs can continue,” he said.

Tomago chief executive Jerome Dozol stated the blunt truth in his statement last week. “Future energy prices are not commercially viable, and there is significant uncertainty about when renewable projects will be available at the scale we need.”

If Australia’s largest aluminium smelter continues to operate beyond 2028, NSW taxpayers will be paying the premium.

“It will ultimately be up to the Minns government in NSW and its federal counterpart to decide how much they’re willing to pay for a Tomago lifeline,” writes Kean. “It could be a lot.” Bowen’s refusal to release the unredacted departmental advice he was handed in May can only mean there are other inconvenient facts.

Scandalously, the Queensland government has refused to disclose the premium its taxpayers will pay to keep the Boyne smelter running in Gladstone. The deal was stitched up by the outgoing Labor government last year, which hid the details behind the fig leaf of commercial confidentiality.

Net zero has become an ideological goal sustained by wishful accounting, false narratives and official concealment. Every economic warning is brushed aside, every cost buried in the fine print, every failure redacted.