Aluminium contract to provide returns and certainty to Tasmania

Hydro Tasmania and Rio Tinto Alcan signed a new electricity hedge contract for the Bell Bay aluminium smelter in December 2010.

The 11-year contract will take effect from 1 January, 2015, when the current arrangements expire. Under the contract, Hydro Tasmania will provide hedging arrangements for 322 MW of baseload electricity.

Hydro Tasmania CEO, Roy Adair said the prices and terms negotiated were consistent with those commercially obtainable by similar large customers in the National Electricity Market.

Mr Adair said Hydro Tasmania welcomed the conclusion to intensive commercial negotiations that began earlier in 2010. The agreement is welcome news to the smelter’s employees and the local community and provides a boost for the state’s economy.