Here's why a key smelter will get multi-billion bailout

Australia and the NSW government will jointly provide A$2.5bn (A$1.76bn) to support Tomago Aluminium’s smelter operations past 2028. A 10-year power purchase arrangement begins after the current contract ends on 31 Dec 2028, with NSW support capped at A$1.22bn from 2029. Tomago’s owners include Rio Tinto (51.55%) and Norsk Hydro (12.4%).

Rio Tinto said it supports a deal among Tomago Aluminium, the Australian Government and New South Wales to secure the Tomago aluminium smelter’s long-term future. The plan includes A$1.1 billion investment to 2038, including A$100 million for decarbonisation, and a 10-year power purchase agreement to 2038 with 100% renewable power from 2033, cutting scope 1 and 2 emissions by 7.1 million tons annually.

Rio Tinto-backed Tomago Aluminium agreed with Australia’s federal and NSW governments on a power deal through 2038. Tomago will sign a 10-year power purchase agreement after its AGL contract ends in 2028, targeting fully renewable electricity from 2033. It plans A$1.1bn investment, including A$100m for decarbonisation, and expects Scope 1 and 2 emissions to fall by 7.1m tonnes annually.

Rio Tinto says Australia’s Tomago aluminium smelter will run on renewable power by 2033 after a 10-year, below-market power supply guarantee worth $2.5bn from the federal and NSW governments. The guarantee starts after its AGL coal contract ends in Dec 2028. Governments cite nearly 3,000 MW of new renewable and firming capacity. Rio Tinto expects 7.1m tonnes/year lower emissions.

Australian Prime Minister Anthony Albanese announced a 2.5 billion Australian dollar, 10-year bailout to keep Rio Tinto’s Tomago aluminum smelter near Newcastle operating from 2029 to 2039. The federal and NSW governments will split funding evenly. Rio Tinto warned the plant could close in 2028 when its electricity contract ends due to higher energy costs.

New South Wales and the Commonwealth will provide a $2.5 billion, 10-year bailout for the Tomago Aluminium Smelter near Newcastle, according to Prime Minister Anthony Albanese. The governments split the cost, with Tomago Aluminium (majority owned by Rio Tinto) investing $1.1 billion. The deal targets closure risk from higher energy prices and includes renewable power plans.