Alcoa Locks in Long-Term Power Supply for Portland Smelter, Securing Future Production
Alcoa of Australia has extended power supply arrangements for its Portland Aluminium Smelter through mid-2035, securing new agreements with AGL that will allow the facility to approach full production capacity. The smelter, which is currently operating at around 80% of its 358,000-ton annual capacity, now has greater certainty about its long-term prospects.
The newly announced 287MW power deal, effective from July 2026, follows a previous 300MW agreement struck last year. Together, these contracts are expected to enable the smelter to produce up to 95% of its total capacity. Alcoa Australia's interim president, Tanya Simmonds, highlighted the importance of the deal, stating that it would provide stability for the smelter’s 760 employees and numerous local suppliers.
The Portland Aluminium Smelter, which generates about 18% of Australia's aluminium, has faced threats of closure twice in the past decade. Government interventions in 2017 and 2021 provided a total of $385 million in subsidies and financial support to keep the smelter operational, following a power outage and challenges related to energy costs.
Currently, about 40% of the smelter’s power comes from renewable sources, including the Portland wind farm. Alcoa has also established agreements with Kentbruck Green Power Hub and Alinta Energy to explore collaboration on the Spinifex offshore wind farm, which, if approved, could supply 1.2GW of electricity. This would equate to around 10% of Victoria’s electricity needs, potentially powering 650,000 homes.
Further energy stability for the region is also in development with Pacific Green’s proposed 1GW battery project at the Portland Energy Park. This large-scale energy storage facility would help manage electricity from renewable sources and support Victoria's energy transition.
