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🇦🇺 Australia /Economy & Trade

NSW Unclear on Cost of Saving Australia's Largest Aluminium Smelter

From ABC Australia · (11m ago) English Mixed tone

Translated from English, summarized and contextualized by DistantNews.

TLDR

  • The New South Wales government is committed to saving Australia's largest aluminium smelter but has not yet determined its financial contribution.
  • The federal government is reportedly seeking a deal similar to one for the Boyne smelter, involving a $1 billion contribution each from federal and state governments.
  • The Tomago smelter employs over 1,000 people, and its future is uncertain due to rising energy costs, with negotiations ongoing for a support package.

The future of Australia's largest aluminium smelter, Tomago Aluminium, hangs in the balance as the New South Wales government navigates the complex financial commitments required to secure its operation. Premier Chris Minns has affirmed the state's dedication to preserving this vital industrial asset, which is also the nation's single largest electricity consumer. However, the exact cost of the state's contribution remains unclear, with Minns indicating that the government is awaiting the federal government's proposed figures.

We're definitely going to put money into saving it and we've committed to doing that. But as it stands today I don't know how much [the federal government] is asking for.

— Chris MinnsNew South Wales Premier Chris Minns explaining the state's commitment but uncertainty regarding the financial contribution to save the Tomago Aluminium smelter.

This situation echoes the recent rescue package for the Boyne smelter in Queensland, where both the federal and state governments agreed to a $1 billion, 50:50 split to support its transition to renewable energy. Industry and Innovation Minister Tim Ayres has suggested this model could serve as a 'useful road-map' for Tomago, emphasizing the potential for joint investment to stimulate further private sector confidence. The federal government, through Minister Ayres, has expressed optimism that New South Wales will recognize the economic benefits of such a partnership, likening it to an 'economic slam dunk.'

It worked for Queensland jobs and it will work here in the Hunter too.

— Tim AyresIndustry and Innovation Minister Tim Ayres referencing the successful deal for the Boyne smelter as a potential model for Tomago.

However, Premier Minns has highlighted key differences between New South Wales and Queensland, particularly concerning the state's reliance on privately owned electricity distributors. This structural difference means any financial injection into the Tomago deal must be sourced from elsewhere within the state budget. Minns is urging the federal government to utilize its dedicated industry grants, designed to support major employment centers, to fund its share of the proposed agreement. With over 1,000 jobs at stake, the urgency for a clear and equitable funding solution is paramount for the Hunter region's economy.

Every dollar I put into this agreement has got to come from somewhere else.

— Chris MinnsNew South Wales Premier Chris Minns highlighting the fiscal challenges the state faces in contributing to the smelter's support package.
DistantNews Editorial

Originally published by ABC Australia in English. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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