31 May 2024
South exultant on Tiwai power deal
A 20-year electricity deal between New Zealand Aluminium Smelters and Meridian has drawn a thrilled reaction from Southland leaders.
Mayor Nobby Clark was “ecstatic”.
“It’s the best news this city has had in decades,’’ he said.
The Tiwai Point smelter employs about 750 people and supports an additional 2500 jobs in the region.
Invercargill deputy mayor and former smelter general manager Tom Campbell welcomed the ”absolutely fantastic news’’ for the smelter staff, and great news for the city and Southland as a whole.
“It means that Tiwai will underpin the economy of the city for another generation,’’ he said.
‘’Rio Tinto deserved thanks for showing confidence in Southland, long into the future,’’ he said.
The smelter had enhanced good times for the region’s economy, but had also been hugely important as a stabilising influence during bad times.
There was no bad aspect to the news, including for the future of renewable energy, where projects had been on hold amid the uncertainty. If the smelter had gone there would have been 600 megawatts spare in the electricity system, and prices would have collapsed around new generators “at least for a while’’.
Grant Shirley, co-owner of Invercargill firm Sheet Metalcraft which has done work for the smelter for 40 years, said the announcement meant security for its staff and business.
“We can look a man in the eye and say we have got work for so many years.”
Sheet Metalcraft replaced alloy cladding on the smelter’s roofs and walls and did sheetmetal, engineering and heavy fabrication work for the Tiwai site, he said.
Shirley anticipated work at the Tiwai plant would increase.
“It’s an old plant and I am guessing they will start spending money on the plant to future-proof it now.”
Southland District Mayor Rob Scott said the deal was positive for the Southland region, though he added some people may have wanted it to close.
“It’s a big industry in the area with a lot of employment and it’s positive news.”
Southland Business Chamber chief executive Sheree Carey said the announcement not only secured the future of the smelter, but it provided a foundation for the entire region to thrive.
It was a “monumental milestone for the region”, she said.
“The agreement, guaranteeing energy supply from three generators until at least 2044, brings unparalleled certainty to the community, staff, and suppliers for the next two decades.
“The chamber is ecstatic for the stability this announcement brings and the positive impact it will have on the wider Southland community.”
The announcement would set the course for Southland’s next 20 years, Carey said.
“We are confident that the future is bright.
“The security of the smelter operations had significant implications for Southland’s economy, employment opportunities, and community wellbeing.
“It ensures stability for the hard-working staff and suppliers who rely on the smelter for their livelihoods, fostering a sense of confidence and resilience in the region.”
Invercargill MP Penny Simmonds called the contract ‘’a shot in the arm’’ for Southlanders, bringing certainty in terms of employment, house prices and business confidence.
“Of course, the decision reaches even further across the community because Tiwai is such a strong supporter of the South – providing sponsorship and funding for many local groups, schools and organisations,’’ she said.
Tiwai management had confirmed to her that NZAS was committed to continuing remediation of contaminants on the site, she said.
“Further, the guarantee of energy supply, one of the conditions of this contract with Meridian Energy, Contact Energy, and Mercury NZ, which will see the smelter dial down a potline when electricity generation is tight – providing up to 185MW of demand response, is a hugely positive outcome.
“This will provide 20% of what the Onslow pumped hydro scheme would have done – without the $17 billion price tag.”
The decision was also hugely positive from an environmental perspective.
“Tiwai produces some of the purest, most carbon-efficient aluminium manufacturer in the world. To see that production remain in the South and not be undertaken by less efficient aluminium producers elsewhere in the world, is a great outcome for the environment and for the planet.“
On the streets of Invercargill, barber Paul McKinlay said it was the best news he’d heard in a long time.
“Being a business owner, I was concerned that if Tiwai closed, what flow-on effect it would have for me personally, and the rest of Invers, so – massive relief.”
Cafe owner Gareth Hamilton said he was “stoked” for the staff at Tiwai being able to keep their jobs, and it was “great for business in Southland”.
“Everyone will just be rapt, you know, it gives everyone a huge amount of certainty in these crazy times.”
Sales person Jane Cockburn said it was “fantastic” news for the region.
“It’s what we’ve been waiting for, across all industries, retailers especially, we’re feeling it. But I think this is exactly what we’ve needed … Especially for a lot of young families, feeling rather nervous with mortgages, and a lot of people that we know work at Tiwai, so I think this is the assurance that we’ve all needed.”
Source: The Southland Times – 31 May 2024