Rio Tinto to Ramp Up New Zealand Aluminium Smelter as Hydroelectric Supply Recovers

Rio Tinto, New Zealand Aluminium smelter

Early Production Increase at Tiwai Point Eases Winter Power Constraints

Rio Tinto to ramp up New Zealand aluminium smelter operations at its 335,000 t/yr Tiwai Point facility from 16 June, ending a temporary electricity demand reduction agreement with utility Meridian Energy. The plant is set to reach full capacity by August, two months earlier than originally planned, following a sharp recovery in New Zealand’s hydroelectric reservoir levels.

The ramp-up comes after an April–May surge in rainfall in the country’s North Island, which replenished hydro lakes to 92pc of their historical seasonal averages by 25 May, easing electricity security concerns. These reservoirs supply a significant portion of New Zealand’s base-load power, enabling Rio Tinto to adjust its agreement with Meridian and accelerate production.

From Energy Shortage to Output Recovery

In March, Rio Tinto had agreed to run Tiwai Point at a reduced rate throughout the winter to support national energy stability. The facility had been operating at one-third reduced capacity since June 2024, producing 290,000 t of aluminium last year — down from its full potential.

The cutbacks were prompted by an electricity shortage caused by low hydro inflows and natural gas supply constraints, which strained the national grid. The recent rainfall reversed these conditions, allowing a return to full aluminium output. However, Meridian retains the right to request further electricity reductions two months after the ramp-up completes.

Sustainability Profile of Tiwai Point Operations

Tiwai Point is powered entirely by hydroelectric energy, enabling Rio Tinto to report zero scope 2 emissions in 2024. Nevertheless, the site emitted around 500,000 t of CO₂ equivalent scope 1 emissions from direct operations last year, according to the company’s annual report. The reliance on renewable electricity underpins the smelter’s low-carbon credentials in the global aluminium supply chain, a competitive advantage in an industry facing increasing ESG scrutiny.

The Metalnomist Commentary

The early ramp-up at Tiwai Point reflects the volatility of energy-dependent smelting operations and the importance of renewable power resilience. With aluminium demand driven by transport, construction, and renewable infrastructure, maintaining stable production from low-carbon sources will remain strategically critical for Rio Tinto.