A New Zealand firm promises its Potline technology could rescue Rio Tinto to keep Tiwai Point open, support the Government to cut carbon emissions and help Meridian's bottom line.
The distressed aluminium smelter uses about 12% of New Zealand's electricity every year, pays tens of millions of dollars every year for electricity infrastructure, while it doesn't use and employs even 1, 000 Kiwis. In late October’19, its multinational owners, Rio Tinto, declared a strategic review of Tiwai.
The Kiwi firm Energia Potior, who has been hired to execute the EnPot at a smelter in Germany and coming up with a smelter in Australia, states that it has a solution to everyone's problems, addressing Meridian’s power needs, the Government’s decarbonisation goals and Rio Tinto’s concerns about profitability.
Rio Tinto surprised by sending everyone last October from Wellington to Invercargill scrambling.
In the New Zealand Parliament, Energy Minister Megan Woods told reporters that the Government wouldn't ask the Electricity Authority to speed up its transmission pricing review to give the smelter some relief from burdensome transmission fees. She also said it was "highly unlikely" that the Government would bail out Rio Tinto, which paid nearly $10 billion in dividends to shareholders in February.
NZAS, the Kiwi subsidiary to Rio Tinto that runs the smelter, communicated that there was a real possibility that Tiwai would close up shop. "The strategic review is quite serious. It's more significant than our previous discussions around the ownership. It's the first time that Rio Tinto has announced a strategic review of its interests in the smelter," NZAS chief executive Stew Hamilton said at the time.
Shutting down Tiwai would leave a thousand New Zealanders jobless and many other contractors & vendors would lose work. But it could also lower power prices for Kiwis in the rest of the country because the plant wouldn't be hogging so much electricity.
In Energia Potior's submission to the ICCC, the firm says that "Meridian Energy has shown interest in how the EnPot technology works as, if Rio Tinto was prepared to install the technology at Tiwai, it might allow Meridian to contract directly with the smelter for dry year support thus removing or reducing any need for Meridian’s current Swaption contract with the thermal generator Genesis".
"Meridian had said publicly to the ICCC that fitting EnPot to Tiwai would be a potential solution for switching off the coal units at Huntly and it would allow Meridian to deal directly with the smelter to purchase that backup in a dry year," Matthews, Global Head of Strategy, Energia Potior, said.
"Meridian is aware of the Enpot technology and we have been talking to Rio Tinto about its application at the Tiwai Point Aluminium smelter for some time to understand what potential it might have for the smelter and as a means to integrating an innovative demand response mechanism into the New Zealand market," a spokesperson said.
"For our part, we will continue to work with Rio Tinto to see if we can find a way that it might be applied effectively."
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