Prime Minister Anthony Albanese has personally intervened in negotiations with NSW Premier Chris Minns to finalise a support package aimed at securing the future of Tomago Aluminium, Australia’s largest aluminium smelter.
The discussions centre on how the federal and NSW governments will share the financial responsibility for ensuring the Hunter Valley facility can access reliable and affordable electricity beyond the expiry of its existing power arrangements.
Tomago Aluminium has warned that without a competitive long-term energy solution, the smelter’s future could be at risk. The facility is one of Australia’s biggest electricity users and supports more than 1,000 direct jobs, along with thousands of additional roles through contractors and regional suppliers.
The proposed agreement is expected to involve government-backed energy arrangements, including support for renewable generation, storage and transmission infrastructure to provide more stable power costs for the smelter.
The negotiations have been politically sensitive, with both governments working through funding responsibilities. The federal government has pushed for a shared approach, while NSW has sought clarity on the scale of its contribution.
Supporters of the deal argue that protecting Tomago is critical for Australia’s manufacturing capability, regional employment and supply chain resilience. The aluminium produced at the facility is used across industries including transport, construction and advanced manufacturing.
Critics have questioned the level of taxpayer support required, arguing governments must ensure that assistance to major industrial companies delivers long-term economic benefits and does not create ongoing dependence on subsidies.
The final agreement is being closely watched as a test of Australia’s strategy for protecting strategic industries while transitioning towards cleaner energy.
