Rio Tinto has said it will consider closing its ISAL aluminum smelter in Iceland if the Icelandic Competition Authority (ICA) does not address the high energy prices imposed by energy provider Landsvirkjun.
The global miner filed a formal complaint to the ICA on Wednesday, alleging “anticompetitive conduct” by Landsvirkjun. The company said that the energy provider’s long-duration power contracts and “discriminatory pricing practices” were affecting the cost-effectiveness of the products produced at the smelter and at other similar facilities across Iceland.
The company told the ICA that the high energy costs prevented Rio Tinto and other Icelandic companies to compete in the export market, which in turn, would be detrimental to the country’s economy. Moreover, the high energy costs are proving unsustainable for ISAL to continue operations, Rio Tinto said in its filing with the ICA.
The aluminum smelter currently employs around 500 people and has the capacity to produce around 212,000mt of aluminum per year.