Setback for granules producer

The company is a highly specialised producer of aluminium powder - a key ingredient in the making of climate change-busting solar panels.

The company said it was already noticing the impact of the tax before yesterday's start date.

``Unfortunately for us the householders are compensated, big business is compensated, but businesses like us, which are completely trade-exposed, don't fit under any of the compensation so we have to somehow carry all of these increased costs, which is difficult,'' general manager Michael Jones said.

``A significant portion of our business is about providing for renewable energy. You can't make a solar cell without aluminium powder. It's not possible - that's the strange bit.''

Like most metal makers, Ecka is a price-taker, with aluminium prices set largely on the London Metal Exchange.

Mr Jones's words echoed those of Bell Bay Aluminium general manager Ray Mostogl last week, who said the carbon tax was just another cost that the smelter would have to wear.

It comes on top of significant freight costs for the companies that must truck goods to ports in either Burnie or Devonport, as Bell Bay lacks a container shipping service after Agility Shipping pulled out almost a year ago.

Mr Jones said: ``Unfortunately for companies like us in manufacturing, we will see all the pass-through costs with no ability to offset . . . these are costs not reflected in our competitors.''

The federal government said it had handed out more than $20 million to 28 small and medium business and community groups to improve energy efficiency in round one of funding under the Energy Efficiency Information Grants.

More than 170 submissions for funding were knocked back, with advice to reapply in a further funding round in October.

The government said it was providing additional support to small and medium business, including an extra $5 million to improve delivery of clean technology advice and other non-grant support programs.

The government is also increasing the instant asset write-off for small and medium businesses with turnover of less than $2 million a year to $6500.