Alcoa's position on Climate Change
 
Alcoa has long recognised the need to respond to the challenge of climate change.  We took an early voluntary global leadership position on addressing climate change and reducing greenhouse gas emissions and have been successful in reducing our greenhouse footprint.  
 
In Australia, Alcoa is reducing greenhouse gas emissions through energy efficiency, productivity improvements and new technology.  In 2003, we achieved our target of reducing global direct greenhouse gas emissions by 25% from a base year of 1990.  Since 2003, we have further reduced global direct greenhouse gas emissions to 44% below 1990 levels.
 
Our position around action on carbon emissions
Alcoa supports an economy-wide response to the challenge of climate change and has maintained a clear consistent position throughout the past two and a half years: the company supports actions that deliver reductions in greenhouse gases without compromising the international competitiveness of Australian industry and jobs. 

Alcoa believes this is achievable and will continue working cooperatively with Government, and other members of parliament, to ensure the position of our industry is well understood.

Striking the right balance is critical to ensure there are not significant impacts on Australia’s alumina and aluminium industries.

Australia can provide leadership on climate change while protecting jobs, vital industries and the communities that rely on their presence.
 
It is essential that any price on carbon does not drive business offshore to countries with no carbon price. This would simply shift emissions to another part of the world, rather than reducing global emissions, and lead to job losses in Australia.

Read Alcoa's most recent media statement in relation to this issue.
 
International Competitiveness - It is important to understand that implementing a carbon price scheme in Australia represents an international competitiveness challenge for Alcoa and other companies that are Emissions Intensive & Trade Exposed (EITE).  Alcoa cannot pass on an increase in costs to our customers.  We do not set our own alumina or aluminium price - the price is set by the London Metals Exchange (LME) which is independent of Alcoa.  This means Alcoa will have to absorb the cost increase resulting from a price on carbon.   If we are absorbing a cost, that our competitors overseas are not, we are at an international competitiveness disadvantage.
 
Carbon Leakage - 'Carbon leakage' is one of the other significant issues the Federal Government is being urged to consider under any price on carbon.  If Australian companies cannot remain internationally competitive they will be forced to move their businesses offshore to countries which do not have a carbon tax, emissions trading or similar schemes in place. In some cases this could lead to greater carbon emissions and be more damaging to the environment - this is 'carbon leakage'. For example, Alcoa’s alumina refineries in Australia are amongst the most greenhouse and energy efficient in the world. Every tonne of alumina made by Alcoa in Australia produces less than half the greenhouse emissions and uses just over half the energy than alumina made in China.  For these reasons, it is important EITE industries are recognised under any price on carbon.