NSW Premier Chris Minns confirms talks to save Australia's biggest aluminium producer Tomago amid crippling power bills
Rio Tinto-owned Tomago, located north of Newcastle, is reportedly seeking billions of dollars in public funds to prevent collapse.
The producer uses about 10 per cent of NSW's power supply and makes about 37 per cent of Australia's primary aluminium.
Its collapse could lead to more than 1,000 people losing their jobs, while 5,000 indirect workers could suffer.
NSW Premier Chris Minns on Thursday stressed Tomago was a 'big employer in NSW, it's a dynamic part of the state, the Hunter and manufacturing is a big part of its future'.
'It's difficult for me to speculate about what the next steps are,' Mr Minns told reporters.
'In order for us to have an effective intervention, we need to have commercial discussions with the owners and operators of (Tomago). That's what we're doing.'
Tomago executives have reportedly asked the NSW and federal governments for assistance amid crippling power prices and as cost-effective and consistent renewable alternatives remain largely unavailable.
Rio Tinto's chief executive Jakob Stausholm earlier this year flagged concerns about the producer's electricity costs where he warned power price contracts beyond 2028 would render Tomago unviable.
The Premier acknowledged there remains 'challenges when it comes to big industries in manufacturing like aluminium and steel'.
He cited the soaring energy costs which hurt Australian manufacturers, but also noted the Trump Administration's decision to hit foreign-made steel and aluminium with a 50 per cent tariff.
'Part of it is energy costs, there's no doubt about it, part of it is also rapid and dramatic changes to the global trading system, particularly when it comes to (the United States') decision to slap initially a 50 per cent then 10 per cent hit on inbound steel and aluminium,' Mr Minns said.
'It may well be Australian aluminium and Australian steel is used domestically, or used in other markets across south-east Asia, South America and other places.
'The problem is that if Chinese steel and Chinese aluminium move to a third country and are dumped on another market, even if it's not Australia, it affects our trading partners.
'It's a complicated web, it's probably not going to be solved overnight. But we recognise it's an important employer, and we are having discussions with the owners.'
Tomago's struggle with power bills comes as the Albanese government has vowed to make the nation a 'renewable energy superpower' with an energy mix of 82 per cent renewables by 2030 and green energy driving local manufacturing.
Labor is looking to boost this through production tax credits for leading Australian aluminium smelters, including Tomago, and give $2 billion back to help with the energy transition.
A federal government source told the AFR it was involved in discussions with Tomago over the details of the tax credit design as it looks to alleviate the impacts of soaring power costs.
The Centre for Independent Studies' senior policy analyst Zoe Hilton said the government's energy policy was crippling the aluminium sector.
'With power prices in Australia rising higher and higher, it simply doesn't make financial sense to run a smelter here,' Ms Hilton told SkyNews.com.au.
'Tomago's current predicament is a direct result of state and federal government plans to shift our grid to mostly intermittent energy sources.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
West Australian
29 minutes ago
- West Australian
Anthony Albanese's China visit: Prime Minister set to travel to Beijing, Shanghai and Chengdu from Saturday
Anthony Albanese has confirmed his visit to China from Saturday, when he is heading to Beijing, Shanghai and Chengdu. The Prime Minister is expected to meet Chinese President Xi Jinping and Premier Li Qiang for the annual bilateral leaders' dialogue during the trip that will span nearly a week. Trade is expected to be high on the agenda, with these meetings the first since China lifted its final barriers on Australian exports. The ban on Australian lobsters was lifted in December. 'China's an important trading partner for Australia – 25 per cent of our exports go to China. What that means is jobs, and one of the things that my government prioritises is jobs,' Mr Albanese said on Tuesday. 'What we have done is to get rid of the more than $20 billion of impediments on goods that were stopped from going to China. 'It's made an enormous difference … products like wine and barley have not just bounced back, they've bounced back higher than they were before.' This will be the fourth time Mr Albanese has met Mr Xi. The talks come as uncertainty continues around US President Donald Trump's tariffs. The US President has publicly issued letters he has sent to several countries, including Japan, South Korea, Malaysia, Indonesia, South Africa and Serbia, informing them he will lift the rate of tariffs imposed on them from 10 per cent to a 'reciprocal' level from August 1. Australia, which has a trade surplus with the US, does not expect to be hit with anything higher than the 10 per cent base rate. China's ambassador to Australia, Xiao Qian, this week called for Australia to expand its trade deal with his country to include greater cooperation on artificial intelligence. Mr Albanese brushed off questions about his approach to this, saying Australia would determine its own policy. Australia is working with the US and UK to cooperate on developing AI and advanced military capabilities as part of AUKUS Pillar II.
Perth Now
31 minutes ago
- Perth Now
Update for Aus as Trump sends tariff letters
Australian goods may not be getting slugged with higher US tariffs, but that does not mean the country is getting the best deal possible, the opposition says. Donald Trump has begun sending out letters to countries that failed to lock in new trading terms with the US. The letters informed them their exports to the US would be hit with new tariff rates from August 1. The countries included close allies Japan and South Korea, which both face 25 per cent imposts. For others, the new rate is as high as 40 per cent. Australia was not named among those facing 'reciprocal tariffs' announced in April but was instead subjected to the universal 10 per cent taxes on all foreign imports – a position Anthony Albanese has said he did not expect to change. Opposition finance spokesman James Paterson said on Tuesday any tariffs on Australia were unacceptable but the Prime Minister had not given Australia the 'best chance' of getting a carve out. 'The only fair tariff on Australia would be 0 per cent, and I hope that's what we get,' Senator Paterson told Nine's Today. 'But we haven't given ourselves the best chance of securing that from the Trump administration because the Prime Minister has not even met President Trump now, seven months after he was elected. 'In stark contrast to other world leaders, like the UK Prime Minister Keir Starmer who did secure an exemption from steel and aluminium tariffs for the UK because of the personal relationship that he formed with President Trump. 'I really hope the Prime Minister doesn't leave it any longer before he forms that relationship and argues for the best case possible for our country.' Opposition finance spokesman James Paterson says the 'only fair tariff for Australia' is 0 per cent. David Crosling / NewsWire Credit: News Corp Australia The UK and Vietnam are the only countries to secure deals with the Trump administration. Though, neither have escaped the US President's levies altogether, with Vietnam still subject to 20 per cent duties. UK Prime Minister Keir Starmer has said his efforts to build a strong personal relationship with Mr Trump helped secure tariff leniency, particularly on automakers. British cars were facing a 25 per cent rate, but that was dropped to 10 per cent. Similarly, British steel and aluminium have remained at the initial 25 per cent rate, while Australian steel and aluminium have been swept up in the 50 per cent rate. But speaking to Sky News, Assistant Treasurer Dan Mulino insisted the Albanese government was 'clearly continuing to argue for the best possible deal'. 'My understanding is that we are still at the position of having a 10 per cent tariff imposed, but the good news is that that is the lowest rate that any country has been able to secure,' he said. 'So we'll continue to argue for the best possible deal, and we'll continue to argue for it to be lower than that.' Mr Mulino went on to cite Productivity Commission analysis that suggested Australia could have an advantage over other countries because 'if we're lower than other countries, that might present opportunities for us to increase our trade with the US'. 'In some situations, the tariffs the US imposing might also offer opportunities for us to secure goods from other countries that might be redirecting their trade to other parts of the world,' he said.
The Advertiser
32 minutes ago
- The Advertiser
'Turning point': Kurri Kurri gas plant fired up for the first time
The gas-powered Kurri Kurri station has fired up for the first time. Snowy Hydro's Hunter Power Project team said they successfully ignited one of the station's two gas turbines and reached full speed late last week. "First fire is a turning point in the power station's development that confirms the design, construction and cold commissioning of the turbine has been successful," Snowy Hydro CEO Dennis Barnes said. The gas-fired project entered the national grid in March, two years after it was meant to begin operating. The 660-megawatt plant was originally intended to be built in time for the closure of the Liddell coal-fired power station in April 2023. In a statement, Snowy Hydro said the gas supply infrastructure was now complete with the station expected to reach full commercial operation the coming months. They said the project had been impacted by 69 days of bad weather in 2025, which had caused delays. The plant will only be used for about five per cent of the time, when electricity demand is high and renewable generation is limited. "Every megawatt of capacity provided by Kurri Kurri enables three megawatts of renewable wind and solar to come online and replace increasingly unreliable coal generation," Mr Barnes said. Snowy Hyrdo stated that the power station remained on track to be delivered within it's target of around $1.3 billion but in March the Newcastle Herald reported that costs could be closer to $2 billion. On the eve of the 2022 federal election, Prime Minister Anthony Albanese, along with Hunter MPs, committed an additional $700 million towards a green hydrogen project at the plant. Mr Albanese conceded in January that the green hydrogen vision had not gone to plan, however, he had not given up on eventually using green hydrogen in the plant. He did not put a timeline on the project, but Mr Albanese confirmed the government's $700 million green hydrogen commitment remained. The gas-powered Kurri Kurri station has fired up for the first time. Snowy Hydro's Hunter Power Project team said they successfully ignited one of the station's two gas turbines and reached full speed late last week. "First fire is a turning point in the power station's development that confirms the design, construction and cold commissioning of the turbine has been successful," Snowy Hydro CEO Dennis Barnes said. The gas-fired project entered the national grid in March, two years after it was meant to begin operating. The 660-megawatt plant was originally intended to be built in time for the closure of the Liddell coal-fired power station in April 2023. In a statement, Snowy Hydro said the gas supply infrastructure was now complete with the station expected to reach full commercial operation the coming months. They said the project had been impacted by 69 days of bad weather in 2025, which had caused delays. The plant will only be used for about five per cent of the time, when electricity demand is high and renewable generation is limited. "Every megawatt of capacity provided by Kurri Kurri enables three megawatts of renewable wind and solar to come online and replace increasingly unreliable coal generation," Mr Barnes said. Snowy Hyrdo stated that the power station remained on track to be delivered within it's target of around $1.3 billion but in March the Newcastle Herald reported that costs could be closer to $2 billion. On the eve of the 2022 federal election, Prime Minister Anthony Albanese, along with Hunter MPs, committed an additional $700 million towards a green hydrogen project at the plant. Mr Albanese conceded in January that the green hydrogen vision had not gone to plan, however, he had not given up on eventually using green hydrogen in the plant. He did not put a timeline on the project, but Mr Albanese confirmed the government's $700 million green hydrogen commitment remained. The gas-powered Kurri Kurri station has fired up for the first time. Snowy Hydro's Hunter Power Project team said they successfully ignited one of the station's two gas turbines and reached full speed late last week. "First fire is a turning point in the power station's development that confirms the design, construction and cold commissioning of the turbine has been successful," Snowy Hydro CEO Dennis Barnes said. The gas-fired project entered the national grid in March, two years after it was meant to begin operating. The 660-megawatt plant was originally intended to be built in time for the closure of the Liddell coal-fired power station in April 2023. In a statement, Snowy Hydro said the gas supply infrastructure was now complete with the station expected to reach full commercial operation the coming months. They said the project had been impacted by 69 days of bad weather in 2025, which had caused delays. The plant will only be used for about five per cent of the time, when electricity demand is high and renewable generation is limited. "Every megawatt of capacity provided by Kurri Kurri enables three megawatts of renewable wind and solar to come online and replace increasingly unreliable coal generation," Mr Barnes said. Snowy Hyrdo stated that the power station remained on track to be delivered within it's target of around $1.3 billion but in March the Newcastle Herald reported that costs could be closer to $2 billion. On the eve of the 2022 federal election, Prime Minister Anthony Albanese, along with Hunter MPs, committed an additional $700 million towards a green hydrogen project at the plant. Mr Albanese conceded in January that the green hydrogen vision had not gone to plan, however, he had not given up on eventually using green hydrogen in the plant. He did not put a timeline on the project, but Mr Albanese confirmed the government's $700 million green hydrogen commitment remained. The gas-powered Kurri Kurri station has fired up for the first time. Snowy Hydro's Hunter Power Project team said they successfully ignited one of the station's two gas turbines and reached full speed late last week. "First fire is a turning point in the power station's development that confirms the design, construction and cold commissioning of the turbine has been successful," Snowy Hydro CEO Dennis Barnes said. The gas-fired project entered the national grid in March, two years after it was meant to begin operating. The 660-megawatt plant was originally intended to be built in time for the closure of the Liddell coal-fired power station in April 2023. In a statement, Snowy Hydro said the gas supply infrastructure was now complete with the station expected to reach full commercial operation the coming months. They said the project had been impacted by 69 days of bad weather in 2025, which had caused delays. The plant will only be used for about five per cent of the time, when electricity demand is high and renewable generation is limited. "Every megawatt of capacity provided by Kurri Kurri enables three megawatts of renewable wind and solar to come online and replace increasingly unreliable coal generation," Mr Barnes said. Snowy Hyrdo stated that the power station remained on track to be delivered within it's target of around $1.3 billion but in March the Newcastle Herald reported that costs could be closer to $2 billion. On the eve of the 2022 federal election, Prime Minister Anthony Albanese, along with Hunter MPs, committed an additional $700 million towards a green hydrogen project at the plant. Mr Albanese conceded in January that the green hydrogen vision had not gone to plan, however, he had not given up on eventually using green hydrogen in the plant. He did not put a timeline on the project, but Mr Albanese confirmed the government's $700 million green hydrogen commitment remained.
