Carbon crunch

By MELISSA MEEHAN
SOUTH east manufacturers face yet another tough year ahead as the carbon tax pushes up energy costs, according to its peak body.
South East Melbourne Manufacturing Association (SEMMA) executive officer Paul Dowling this week raised its concerns that the direct impact of carbon pricing on industrial electricity costs would work out to an increase of between 22 and 28 per cent compared to the government’s previous assurance that it would not exceed 10 per cent.
Mr Dowling said manufacturers faced some tough times.
“For many of our members the negative impact of this increase will be significant, particularly at a time when business levels are subdued,” he said.
SEMMA has just completed its electricity group purchasing deal for its members, which is designed to reduce the rates of small to medium sized members pay for their electricity.
Mr Dowling said manufacturers had faced many crippling and constant price increases over the past few years and were worried about the impact of the changes. They called on the government to subsidise the increases, as they will for individuals.
“The carbon tax – imposed as a flat rate per kWh – impacts manufacturers and households completely differently,” he said.
“While we (SEMMA) have no doubt that the government’s intentions were honourable when previously advising the carbon pricing impact on their energy costs would be 10 per cent, we believe they have not taken into account the impact of introducing this as a flat amount.”
He said the government did not have a plan in place to generate immediate relief to manufacturers and called on them to rethink their approach to how they would assist the industry during the transition.
When contacted by the Star on Wednesday, the government was unable to provide a response by time of print.