The move by the Australian Workers Union comes ahead of talks on a new workplace agreement at Portland and amid concern the smelter could be shut.

Fairfax Media revealed earlier this year that the Portland smelter was running at a loss and facing a huge surge in costs. The smelter employs directly about 540 people and supports 2000 jobs, and is crucial to the Portland economy.

AWU state secretary Ben Davis, in a letter to Alcoa, said the union understood it was a "difficult year" for the smelter with the "cessation of legacy subsidies" and a challenging commercial environment.

Mr Davis said a meeting of union members at Portland this week agreed to support a wage freeze and proposed a one-year deal with no changes to wages and conditions.

A 2 per cent pay rise for the Alcoa workers, with on-costs, would be worth about $1 million.

It is unusual for unions at large workplaces to offer wage freezes. It occurred occasionally in Australia during the global financial crisis.

The aim was to reduce uncertainty around Portland's future.

"We also believe that in the current uncertain environment that bargaining would be clouded for both sides in light of the other issues that confront us," Mr Davis wrote.

Mr Davis, in his letter, said the wage freeze offer was "in recognition of the uncertainty that exists about the future of the Portland smelter and our desire to see the smelter continue into the future".

Alcoa's Portland smelter manager Peter Chellis praised the union's "responsible approach" ahead of the EBA negotiations.

"It demonstrates that all parties remain focused on the smelter's viability in tough market conditions in order to help protect the approximately 2000 direct and indirect jobs associated with the smelter," he said.

Sharemarket analysts estimate the Portland smelter's electricity costs will rise by $50 million to $90 million as a government subsidy is ended and a new power contract starts with AGL in November.

Alcoa has been trying to offset that rise in costs and has also held numerous meetings with state and federal politicians to press for assistance.

The Andrews government would be alarmed if Alcoa was to shut the smelter. It would come amid an exodus of manufacturing jobs in Victoria including the departure of the large car makers.

Macquarie analysts estimated earlier this year that without the subsidy and the rising power contract from November, the Portland smelter could lose more than $100 million a year.

Alcoa's global business made a large loss at the end of 2015 and has been shutting or part-closing smelters around the world. Portland has been listed in company documents with six other Alcoa plants with "idled" production. In 2014, Alcoa shut its Point Henry smelter near Geelong.

The Portland smelter is responsible for almost 10 per cent of Victoria's electricity demand.