Alcoa of Australia has announced a renewal of its partnership with AGL Energy that will see the energy provider supply electricity to the future operations of Alcoa’s Portland Aluminium Smelter in Victoria.
The nine-year agreement covers 300MW of power supply and takes effect from 1 July 2026 when the existing contracts with AGL end. This volume represents approximately 50 per cent of the energy required to meet the facility’s nameplate capacity of 358,000t of aluminium per year. The smelter is currently producing about 75 per cent of that volume.
Alcoa Australia President, Matt Reed, said that the agreement was welcome news for the smelter’s workforce of more than 760 employees and contractors.
“On behalf of the Portland Aluminium joint venture partners, we are pleased to continue our longstanding relationship with AGL with this agreement that provides a strong platform for the long-term future of the smelter, which is central to the social and economic fabric of the region,” Mr Reed said.
As well as producing around 20 per cent of Australia’s aluminium, the smelter makes a significant contribution to the Victorian economy, with more than $68 million in direct salaries, wages and benefits, and $179 million in local supply contracts paid in 2022.
As a cornerstone of energy demand in Victoria, the smelter also continues to provide important market services and helps provide stability to the electricity network as more renewables enter the system.
Currently, approximately 40 per cent of the smelter’s consumed electricity is derived from renewable sources including electricity from the nearby Portland wind farm.
Mr Reed said Alcoa was pursuing options for the smelter’s remaining electricity requirements from mid-2026, with a strong focus on renewable energy, aligned with the company’s ambition to achieve net zero carbon emissions by 2050.
“South-Western Victoria has been identified as a renewable energy zone with several emerging projects that could potentially provide green power to the smelter and the wider region.”
Featured image: The Portland Aluminium Smelter. Image credit: Alcoa of Australia.
