Stalemate ends as Tasmania’s Boyer mill renews power supply with Aurora Energy
A long-running negotiation over a security deposit has culminated in a power supply agreement between Tasmania’s last remaining paper mill, Boyer in New Norfolk, and the state-owned energy retailer Aurora Energy. The deal ends months of public and private standoffs that threatened to disrupt energy supply for a major industrial employer in the state.
What triggered the dispute?
The conflict centered on the level of credit security that Boyer would provide to Aurora Energy to cover electricity costs. Aurora sought a $7 million bank guarantee, a figure that Boyer owner David Marriner described as “obscene.” In response, Marriner offered $2.5 million, which was rejected by the energy retailer. The disagreement reflected the broader tension between industrial users and the formal credit requirements of a state-owned utility.
The broader business context
Boyer is among Tasmania’s largest power consumers and has been negotiating a new electricity supply agreement with Aurora Energy throughout the year. The mill’s owner, a Melbourne-based businessman, has indicated a strategic shift away from coal-fired boilers toward electrification and cleaner energy sources as part of a broader modernization and decarbonization plan for the plant.
Details of the new arrangement
On a Saturday morning, Tasmania’s State Energy Minister announced that the agreement had been reached and that it balanced Aurora’s fiduciary and commercial duties with a workable framework for Boyer. The precise terms have not been made public, but the parties described the outcome as a mutually acceptable solution that supports the mill’s ongoing operation and its transition to electrified processes.
Implications for electrification and jobs
Both sides highlighted electrification as a central objective of the deal. For Boyer, converting boilers from coal to electricity is a strategic priority that aligns with broader environmental and economic goals for Tasmania. The agreement is seen as a catalyst for the plant’s modernization, enabling continued employment for hundreds of workers and preserving local industry in a state where major power users play a pivotal role in the grid.
Industry and political reactions
Tasmanian industry groups welcomed the outcome, noting that the survival of major industrial employers helps stabilize energy prices and transmission costs for consumers across the state. The Tasmanian Chamber of Commerce and Industry emphasized that high-energy users subsidize transmission costs, meaning the loss of such industries could push bills upward for households and smaller businesses alike. The resolution was also praised by Labor’s Energy and Renewables Minister for providing needed certainty for workers on site.
What happens next?
With the security issues settled, Boyer and Aurora Energy can move forward on the commercial terms of the power supply agreement. Industry observers expect continued collaboration on the plant’s electrification program, grid resilience, and Tasmania’s long-term energy strategy. While the public release of the deal’s specifics remains pending, the consensus across stakeholders is that the arrangement maintains energy reliability while supporting a critical regional employer and its workforce.
Conclusion
The end of the security deposit dispute marks a significant milestone for Tasmania’s energy landscape. By enabling Boyer’s transition to electrified operations while sustaining a major industrial employer, the deal supports grid stability, jobs, and the broader goal of cleaner, more reliable power for the state.
