Tomago Aluminium smelter gets green investment

The Australian and NSW Governments have jointly contributed $2.5 billion to secure the future of aluminium smelting in the Newcastle/Hunter region.

As Tomago Aluminium is Australia’s largest single electricity user, securing a long-term renewable energy pathway for the smelter is critical.

The governments said in a statement that the joint investment will deliver a long-term renewable energy solution for the Tomago Aluminium smelter that supports commercially sustainable operations beyond 2028 and accelerates decarbonisation of more than 10% of the state’s electricity grid.

Tomago Aluminium has agreed to invest at least $1.1 billion in the facility as part of the deal. This includes $100 million to drive further decarbonisation activities at the smelter and undertake a demand-response program to support the NSW grid.

As part of the agreement, the NSW Government’s contribution is capped at $1.225 billion over 10 years from 2029.

As a result, Tomago Aluminium will continue operating beyond the expiry of its current electricity supply contract on 31 December 2028. The joint investment will underpin nearly 3 GW of new renewable generation and firming capacity.

The investment will also secure 1000 direct jobs at Tomago aluminium and 5000 indirect jobs across the Hunter region.

“This site isn’t just important for Newcastle and the Hunter, it’s a critical asset for the country and our manufacturing future,” said Prime Minister Anthony Albanese. “I’m proud of the work we’ve done with the company, with the Minns Labor government, with local members and with the workers here onsite to secure Tomago’s future beyond 2028.”

NSW Premier Chris Minns said, “The Hunter has powered NSW and helped build this country for generations. This agreement is about making sure it remains an industrial and manufacturing powerhouse for generations to come.

“This is part of our bigger plan for the Hunter, securing the good jobs and industries that are here today, while investing $12 billion to bring train manufacturing back to the Hunter and create good, secure jobs for decades to come.”

Climate Council Senior Advisor Ben McLeod welcomed the governments’ investment into clean energy for the smelter, and said: “Powering our single-largest electricity user with wind, solar and storage is a light bulb moment for clean industry.

“This deal to lock in the future of the Tomago Smelter shows what renewable power makes possible: secure jobs, a stronger grid and less climate pollution. As our old and increasingly unreliable coal-fired generators close, reliable renewables are powering manufacturers into a cleaner, stronger future.”

Image credit: iStock.com/D. Lentz. Image used for illustrative purposes only.