Gladstone's Boyne Island aluminium smelter is set to shed jobs and cut $100 million-worth of production because of soaring Queensland power prices.

Boyne Smelters Ltd general manager Joe Rea said it was the second time in three years the facility had cut production due to "uncompetitive electricity prices".

Boyne Smelters Ltd is set to shed jobs and cut production due to "uncompetitive" power prices. Credit:Boyne Smelters

"BSL is paying more than 500 times more than what it costs to generate electricity," he said in a statement.

"The decision to curtail production is a very difficult one. It takes months, not weeks, to bring the smelter back to a stable full capacity, and that can only happen if and when power prices become competitive."