Solar, wind, pumped hydro in $2.5 billion funding mix to help decarbonise Tomago

The Rio Tinto, Gove Aluminium Finance and Norsk Hydro joint venture (JV)-owned Tomago Aluminium Smelter in the Hunter region of New South Wales (NSW) has entered into a 10-year power purchase agreement with the federal and NSW goverments to shore up its future to 2038.

As part of the $2.5 billion (USD 1.7 billion) agreement, shared equally by the federal and NSW state governments, Tomago will also tip in a $1.1 billion investment on the smelter, including $100 million for decarbonisation intiatives and demand response capability.

Tomago has roughly 22.8 GWh of electricity demand per day, and a near constant power demand of 950 MW or the equivalent of 10% of NSW total electricity demand.

At an official announcement at Tomago on 13 August 2026 Federal Minister for Climate Change & Energy Chris Bowen said Jerome Dozol, Chief Executive Officer of Tomago Aluminium revealed a lack of confidence that enough renewable energy was in the pipeline to keep Tomago alive and nor could the facility rely on coal-fired power anymore.

“And we agreed with him. And so, we worked on a very innovative arrangement together with NSW, working with our government agencies, Clean Energy Finance Corporation (CEFC) and Snowy Hydro, to bring on that renewable energy—three GW,” Bowen said.

Bowen added the energy generation for Tomago will take various forms and won’t all be located in the Hunter.

“It’ll be spread predominantly out through NSW. It will take projects which have been worked on in the pipeline that maybe have already received environmental approval but haven’t reached final investment decision,” Bowen said.

“Some will be wind farms, others will be solar backed by batteries. The combination of a portfolio put together, as I said, working with the CEFC and Snowy Hydro to make sure, as Jerome said, the future of aluminium is decarbonised, and we are going to help Tomago make sure that they are an essential part of that future globally.”

Dozol said the agreement provides the certainty needed to invest in the future of the smelter.

“Over the coming years, we will invest $1.1 billion to improve reliability and performance, extend asset life, and strengthen our competitiveness.”

Smart Energy Council Chief Executive Officer David McElrea said the agreement aligns directly with the federal government’s Future Made in Australia strategy, positioning Australian heavy industry to compete in a rapidly decarbonising global economy.

“Retaining our renewable-powered industrial base here in Australia is crucial to securing jobs and anchoring our place at the centre of the growing global green metals supply chain,” McElrea said.

“By contracting new clean energy supply to the smelter, this agreement will enable billions of dollars of investment into renewable generation and energy storage. That investment will drive massive cuts to carbon pollution while cementing NSW as a global clean energy powerhouse.”