Huon Aquaculture says there is no likelihood of salmon farming ever becoming entirely land-based in Tasmania for economic and environmental reasons.
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A House of Representatives committee in April established an inquiry on Australia's aquaculture sector following a referral from Tasmanian Liberal senator Jonathon Duniam.
The Tasmanian Alliance for Marine Protect and Neighbours of Fish Farming in a joint submission to the inquiry said it recommended the federal government push the salmon industry to move to self-contained onshore facilities.
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It said this would enhance Tasmania's environmental reputation as well as its tourism and hospitality industries.
But Huon Aquaculture's Peter and Frances Bender said the experience and reliability of completely growing salmon entirely on land in commercial volumes was not yet proven.
They said the land, electricity and water resources required to house enough facilities to end sea-based operations were not feasible or financially viable.
"The industry would require the same energy needs as that of a city of 1.2 million people," they said.
"If land-based salmon farming became commercially viable, it would make sense to establish these facilities closer to market areas on the mainland.
"As a proud and fiercely Tasmanian company, we want to avoid moving our assets and employees to the mainland and keep Tasmanians employed in Tasmania."
Petuna in a submission to the inquiry said land-based facilities had strict environmental licences with no additional support for capital investment into waste management.
"The Tasmanian salmon industry is expected to be at the forefront of wastewater re-use and processing in aquaculture, yet there is little subsidy or investment to assist in upgrading these systems when it is realised that the regulations are some of the most stringent in the world," it said.
The company recommended support through research grants or subsidies.
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