Meridian Energy seeks 15 years of operational commitment from Tiwai aluminium smelter

Meridian Energy, New Zealand's most significant renewable energy generator and Rio Tinto, the majority owner of the Tiwai Point aluminium smelter, have made predominantly positive comments about their anticipation of attaining a deal to keep the smelter open after 2024.

In spite of the Electricity Authority's announcement last week that it would veto any supply deal that it considered unfair to other prospective power users, the deal looks to proceed regardless.

The island country in the southwestern Pacific Ocean, New Zealand’s only aluminium smelter requires a new power supply deal if it desires to remain open after its current supply agreement expires at the end of 2024.

On 24th August 2022, Neal Barclay, the CEO of Meridian Energy, said, "The power firm required a contract that would see the smelter remain for at least another 15 years."

"We would need to see a long-term commitment to New Zealand, so we are talking, obviously, 15 to 20 years. I think it needs to be at least that," he said.

However, the Merdian chief executive of New Zealand's energy supplier did not indicate that Meridian and the Tiwai Point aluminium smelter were close to dealing on any new price the smelter might pay for power supply.

"There was an immense gap between the price the aluminium smelter was currently paying for power – approximately 3.5 cents per kilowatt-hour – and what Meridian considered a sustainable price", he said.

Barclay said, "Whether the aluminium smelter runs or shuts down become much less relevant in my view as far as Meridian was concerned."

No comment has been made from the global aluminium giant Rio Tinto on this issue. But the Anglo-Australian company earlier stated, “We continue to see a positive pathway for a longer future for the aluminium smelter."