The Victorian Greens want to secure jobs at the Portland Aluminium smelter with $50 million worth of site upgrades to help scale down its electricity use on days of high demand and power it with renewable energy.
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Acting Victorian Greens leader Ellen Sandell is calling for the state government to invest the money in the Alcoa site for technology that would turn it into a "reverse battery".
"It's quite unusual for the Greens to be calling for government money to be spent on Alcoa, we are actually flipping that around now and saying actually we could keep an aluminium smelter here," Ms Sandell said.
"We know that Alcoa internationally is saying they want to reduce their carbon emissions, that means dirty plants like the one in Portland they will shut, and those jobs will go offshore, but we don't want that."
The Greens also want five to 10 new renewable energy projects to supply the smelter's energy needs.
Ms Sandell said the state government was already subsidising Alcoa's energy use in an arrangement worth millions set to expire next June.
She said if the site could act like a "reverse battery" it would prevent a repeat of incidents when the state's electricity network failed and caused molten aluminium at the smelter to solidify.
"We wouldn't have to rely on our gas peaking plants, or ageing coal power stations," Ms Sandell said.
The site is currently the state's single biggest electricity consumer and Alcoa sparked fears last year that it could close the Portland smelter after it announced a review that "would "pursue non-core asset sales".
"The Greens believe that instead of closing the Portland operation and laying off its 1500 workers, the government could help it transform into a 'reverse battery'," Ms Sandell said.
She said she had spoken to energy researchers about the project, but not Alcoa.
Ms Sandell said the proposal would not necessarily mean the site would produce less.
"Over a whole year they would be producing the same amount just at different times, they don't have the capacity to do that now because they haven't had that upgrade," she said.
"There are smelters overseas that allow them to scale up and down and don't have that issue of the pots cooling and causing damage."
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