17 March 2023
Southland Business Chamber, Great South support smelter staying open
The Southland Business Chamber and Great South are backing that the NZAS aluminium smelter at Tiwai Point stays open saying “the jobs and GDP it produces are significantly higher than the alternatives that have been suggested”.
A hydrogen plant could potentially provide an alternative use for all the electricity used to power the smelter, depending on its scale, should the smelter close in 2024.
In mid-2021, Contact Energy and Meridian Energy announced two Australian partners were in the mix to develop the world’s largest green hydrogen plant in Southland, after a feasibility report noted a green hydrogen plant had the potential to earn hundreds of millions of dollars in export revenue and help decarbonise economies in New Zealand and overseas.
On Thursday, the chamber and Great South released a statement that said retaining the Tiwai Smelter and introducing other industries, such as hydrogen production, was not an “either-or” scenario, because both industries could coexist and complement each other, creating even more economic opportunities for Southland.
“The jobs and GDP produced by Tiwai smelter are significantly higher than the alternatives that have been suggested, such as data warehouses and hydrogen production.
“When you factor in the role it can play in the decarbonisation of New Zealand, and helping to bring new industries on stream, it is clear that having the smelter will drive even more economic opportunities for the region,” it says.
Great South chief executive Chami Abeysinghe said: “Growing the pie is a much better outcome for our region.
“Tiwai continuing in Southland will support regional development by encouraging other big players to invest here.”
Furthermore, the smelter was an important contributor to New Zealand’s decarbonisation journey.
It uses about 12% of the country’s electricity, which is turned into aluminium, “but it also helps provide critical inputs into our own energy security by dialling down its usage during peak energy periods”, the statement says.
In addition to aluminium production, the smelter has the potential to play a significant role in the emerging green hydrogen industry.
“As a large industrial user of energy, it can support the build of new renewables and green hydrogen facilities in Southland.
“Tiwai could potentially be a foundation customer for a green hydrogen facility with a potentially large annual demand for green hydrogen in its industrial processes.”
Chamber chief executive officer Sheree Carey said it was not about choosing between retaining the smelter or introducing new industries, it was about embracing both and creating a sustainable and prosperous future for Southland.
NZAS has been approached for comment.
The smelter provides jobs for about 1000 people and supports an additional 2500 jobs.
It produces about 330,000 tonnes of aluminium per year, with most of it being exported to countries like Japan.
In 2020, Rio Tinto announced plans to shut the smelter down in 2021, citing expensive electricity costs, but a year later it announced it had secured a deal with Meridian to keep it open until 2024.
The smelter has been in negotiations with the electricity generator about its future past that date.
NZAS has been approached for comment.
Source: stuff.co.nz – 16 March 2023