Business leaders urge governments to act as smelter power deadline looms

Pressure on governments as deadline looms for Bell Bay Aluminium power deal In short: Rio Tinto's deadline for a new power deal for its Bell Bay Aluminium smelter in Northern Tasmania is one week away. As the deadline nears, industry and community leaders have written to the prime minister and Tasmanian premier demanding urgent action to secure the smelter's future. What's next? A one-year power deal that Rio Tinto signed last year is due to expire at the end of 2026. Rio Tinto's deadline for a new power deal for its Bell Bay Aluminium smelter in Tasmania's north is just one week away, as business leaders step up pressure on the state and federal governments to help secure the smelter's future. The smelter, which directly employs about 550 people, is one of the biggest companies connected to Tasmania's power grid. Last year Rio Tinto signed a one-year power deal with Hydro Tasmania. That deal is due to expire at the end of the year. Last month, federal Bass MP Jess Teesdale said she understood Rio Tinto had set a deadline for the end of this month to secure a new power deal, with a "very high risk the smelter would close" if the deadline is not met. State-owned power company Hydro Tasmania has continued to negotiate a power deal with Rio Tinto, which was offering $60 million less than what Hydro Tasmania was asking for. Uncertainty over the deal and the smelter's future has prompted 13 northern Tasmanian industry and community leaders to write open letters to Prime Minister Anthony Albanese and Premier Jeremy Rockliff, calling for urgent federal and state action to secure the smelter's future. Industry, community leaders demand action Among the signatories were Bell Bay Advanced Manufacturing Zone chief executive Susie Bower and Tasmanian Minerals, Manufacturing and Energy Council chief executive Ray Mostogl. The letter to Mr Rockliff urged a new 10-year power agreement be signed as soon as possible. "In 2025, the smelter paid almost $76 million in salaries, invested $40 million in capital works and spent approximately $262 million with around 180 Tasmanian suppliers," the letter reads. Speaking at Bell Bay this morning, Ms Bower said the outcome of negotiations was critical to Tasmania's future. "We want to have the voices here of industry, unions and community, come together with business to say to our governments, 'this is critically important that you work together, you get a solution, and you get it done now'," Ms Bower said. "Hydro [Tasmania] is owned by the state government, so that is the critical negotiation that needs to occur. "But if there is a gap then the state government needs to be putting that on the table for the federal government to be able to come to a solution together." George Town Mayor Greg Kieser said if the smelter were to close, the impact on the George Town community, and Tasmania more broadly, would be "huge". "Both from the personal side and families who rely on that income, to the supply chain who rely on the business that keeps them viable," Councillor Kieser said. "You really just can't understate the impact that [Bell Bay's closure] will have on this immediate community. "So if you just looked at rateable revenue, the hole that it would leave in my community's finances would be massive,"he said. Government minister Jo Palmer said Hydro Tasmania had put a "very good" power deal on the table for Rio Tinto to consider. "Now we need the federal government to step in, just as it's done in New South Wales and in Queensland to actually bridge that gap between what Rio is saying it needs and what Hydro Tasmania is able to put on the table," Ms Palmer said. Asked if Hydro Tasmania would be willing to bridge the $60 million gap to secure a deal, Ms Palmer said that was not Hydro Tasmania's responsibility. A spokesperson for federal Industry Minister Tim Ayres said the Tasmanian government had "complete control" over the "supply of low-cost, renewable electricity for Tasmanian industry". "We encourage the Tasmanian government to use all the levers at its disposal to support its industrial base,"the spokesperson said. Deputy Tasmanian Labor leader Janie Finlay said the state government needed to secure a fair and competitive deal. "Once that deal is done, Premier Rockliff needs to take a clear package to Canberra and seek Commonwealth support," Ms Finlay said. According to its website, the Bell Bay Aluminium smelter produces roughly 190,000 tonnes of aluminium annually.