Aluminium smelter to shed load to protect the power grid

Alcoa Corporation has announced new agreements with multiple power generators for the Portland Aluminium Smelter in the Australian state of Victoria. The five-year agreements with AGL, Alinta Energy and Origin will each commence August 1, 2021, when an existing agreement with AGL expires on July 31, 2021.

The Australian Federal Government has committed, subject to approval, to provide up to AUD $19.2 million per year for four years to underwrite the smelter’s participation in the Reliability and Emergency Reserve Trader scheme.

The arrangement will recognize the smelter’s ability to rapidly shed load when required to help protect the power grid from unexpected interruptions when it is under duress. In addition, in recognition of the valuable contribution Portland Aluminium makes to the Victorian economy, the Victorian Government has agreed in principle to a funding package to match the Federal Government contribution.

As a stable baseload energy consumer, the smelter will continue to provide important market stability as more renewables enter the system. Currently, more than 30 percent of the smelter’s consumed electricity is derived from renewable sources, including electricity from a nearby wind farm. This figure is expected to grow with implementation of the Victorian Renewable Energy Target that aims to reach 50 percent renewables by 2030.

Portland Aluminium is an unincorporated joint venture between Alcoa of Australia Limited 55%, CITIC Nominees Pty Ltd 22.5% and Marubeni Aluminium Australia Pty Ltd 22.5%. Alcoa of Australia Limited is owned by Alcoa Corporation 60% and Alumina Limited 40%. Current production is approximately 85% of the smelter’s total nameplate capacity of 358,000 tonnes per year.

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