AGL won’t subsidize Tomago Aluminium’s new energy contract, risking its future despite government support.

AGL has confirmed it will not cross-subsidize Tomago Aluminium’s next energy contract, insisting future deals must reflect market prices after the Liddell power station’s closure. The smelter, a major Hunter region employer, faces uncertainty as its current contract expires in 2028, with high energy costs and global competition threatening its viability. AGL’s outgoing COO said it won’t absorb higher costs for Rio Tinto, its co-owner. The federal government has pledged $2 billion in production tax credits to help four Australian smelters, including Tomago, transition to renewables by 2035. Both federal and state leaders support preserving the plant but stress Rio Tinto must decide its future by year-end amid global trade pressures and potential Chinese dumping.