- High Taxpayer Cost: BlueScope’s potential acquisition of the Whyalla steelworks could cost Australian taxpayers up to $2 billion in extra subsidies over the next decade.
- Expert Analysis: A new report from think tank Climate Energy Finance has detailed the potential financial burden of the gas-led rescue plan.
- Funding Breakdown: The subsidies would likely support gas supply from Santos and fund a new 160km pipeline to the facility.
- Economic Concerns: The analysis raises questions about the long-term public cost of propping up the ailing steelworks with a fossil-fuel-based strategy.
A proposed buyout of the struggling Whyalla steelworks by a consortium led by BlueScope could leave Australian taxpayers with a hefty bill, a new analysis has found. According to a report by the think tank Climate Energy Finance, the gas-powered rescue plan may require an additional $1.7 billion to $2 billion in public subsidies over the next ten years.
The $2 Billion Price Tag
The report from Climate Energy Finance highlights serious concerns about the financial implications of the proposed acquisition. The think tank estimates that the total cost to the public will skyrocket if the deal proceeds, placing a significant burden on taxpayers to support the transition and operation of the South Australian facility.
This analysis brings to light the hidden costs associated with the “gas-led” recovery strategy for the iconic but financially troubled steelworks.
Where Would the Subsidies Go?
The projected costs are tied to two major components of the rescue plan. A significant portion of the funds would be directed towards subsidizing the gas supply required to power the plant. The report identifies oil and gas giant Santos as a likely recipient of these payments.
Furthermore, substantial public funding would be necessary to develop new infrastructure. A key project would be the construction of a 160km pipeline expansion to transport the gas to the Whyalla steelworks, a critical but expensive piece of the puzzle.
A Gas-Led Future in Question
The findings from Climate Energy Finance cast a shadow over the proposed buyout, shifting the focus to the long-term economic viability and public responsibility of the plan. As the BlueScope consortium moves forward with its bid, the potential for a multi-billion dollar taxpayer-funded subsidy package is now a central part of the conversation surrounding the future of Australian manufacturing and the Whyalla community. The debate now centers on whether this is a sustainable investment or a costly commitment to a fossil-fuel-dependent future.
Image Referance: https://www.afr.com/companies/manufacturing/gas-led-rescue-of-whyalla-steelworks-may-cost-taxpayers-extra-2b-20251113-p5nf1w