Rio Tinto's Bell Bay Smelter Faces Uncertain Future Amid Power Pricing Dispute in Tasmania

Published: Aug 11, 2026 15:13

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[SMM Aluminum Express News] The future of Rio Tinto’s Bell Bay aluminum smelter in Tasmania remains uncertain as negotiations over a new 10-year electricity agreement with Hydro Tasmania face an estimated A$60 million annual pricing gap. Tasmania Energy Minister Nick Duigan said the difference is between the power price Rio Tinto says it needs to keep the smelter viable and the lowest price Hydro Tasmania can commercially offer. The current power agreement expires on 31 December 2026, putting more than 550 direct jobs at risk if a new arrangement cannot be reached. The Tasmanian government is calling for federal support to help bridge the gap, while uncertainty has emerged over Bell Bay’s access to Australia’s A$2 billion Green Aluminium Production Credit scheme. The federal government had previously indicated Bell Bay would be eligible, but recent comments suggested the credits are primarily intended for smelters transitioning from fossil-fuel power to renewables, whereas Bell Bay already operates on hydroelectricity. Hydro Tasmania said it has pushed its offer as low as commercially sustainable and indicated government support may be required to close the remaining gap.

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