Co-existence proposed for Tiwai smelter

The NZAS aluminium smelter at Tiwai Point could co-exist with a proposed hydrogen plant, rather than one or the other, according to Southland business leaders.

The Southland Business Chamber and Great South have announced their support for retaining the Tiwai Point aluminum smelter in the region.

In 2021, Meridian and Contact Energy proposed building the world’s first large-scale green hydrogen plant, potentially providing an alternative use for the electricity consumed by Tiwai Point aluminium smelter should it close in 2024.

Tiwai smelter plays an important role in Southland’s economy, providing jobs for 1000 people and supporting an additional 2500, though its potential closure has been a near constant threat for several years.

In a joint statement released on Thursday, the chamber and Great South said it was not an "either-or" scenario, and both industries could coexist and complement each other in generating economic opportunities for Southland.

Great South CEO Chami Abeysinghe said growing the pie was a much better outcome for the region.

"Tiwai continuing in Southland will support regional development by encouraging other big players to invest here."

The jobs and GDP produced by the smelter would be significantly higher than the alternatives that have been suggested, such as data warehouses and hydrogen production, she said.

"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."

"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."

Southland Business Chamber Sheree Carey said embracing both sectors would create a sustainable and prosperous future for the region.

The smelter uses about 12% of the country’s electricity and helps provide critical inputs into the country’s energy security by dialling down its usage during peak energy periods.

It produces around 330,000 tonnes of aluminium per year, with most of it going to export.