New milestone in Tasmania’s power landscape
A major turning point has arrived for Tasmania’s energy sector and its largest industrial users. The Boyer pulp and paper mill at New Norfolk, owned by Melbourne businessman David Marriner, has secured a power supply agreement with the state-owned energy retailer, Aurora Energy. The breakthrough ends months of public and private discussions focused on a security deposit and credit arrangements that underscored the broader challenge of keeping critical industry online while advancing a costly electrification agenda.
From friction to footing: the security deposit dispute
Earlier this year, the negotiations were overshadowed by a contentious demand for a $7 million bank guarantee from Boyer to cover energy costs. Mr. Marriner criticized the figure as “obscene” and countered with a $2.5 million offer, which Aurora Energy declined. The exchange highlighted not just a single credit line, but the livelier question of how energy reliability and commercial prudence intersect in a small market with a heavy industrial footprint.
What the agreement means for Boyer and Tasmanian energy
The terms of the compromise have not been made public, but the government and stakeholders welcomed the outcome as a sensible balance between Aurora’s fiduciary duties and Boyer’s need for predictable energy pricing. State Energy Minister Nick Duigan said the arrangement provides “a workable solution for Boyer” while meeting Aurora’s commercial obligations. For Boyer, the deal is a crucial step in an ambitious plan to electrify the site and reduce its reliance on coal-fired boilers.
Electrification on the horizon
Mr. Marriner has consistently framed electrification as essential to the mill’s future viability and environmental goals. The plan aligns with a broader Tasmanian push to decarbonize heavy industry through electrification and potentially renewable energy integration. With the new security arrangements in place, Boyer can focus on transitioning boilers away from coal while maintaining uninterrupted production for customers and communities that rely on paper products.
Impact on jobs and the grid
Local industry advocates emphasize the broader significance of the deal. The mill is among Tasmania’s largest electricity users, and its continuity influences the state’s energy grid and transmission economics. The Tasmania Chamber of Commerce and Industry and others argue that safeguarding major industrial customers helps balance transmission costs across consumers, ensuring that households do not bear disproportionate charges when industrial load holds steady or grows.
Local voices and national relevance
Industry leaders highlighted that keeping a paper mill operational supports jobs in southern Tasmania and preserves Australia’s manufacturing capability. The Tasmanian Chamber’s president noted that maintaining such facilities has national resonance—supporting local employment while contributing to a resilient domestic paper supply chain.
What’s next for the site and the state
Beyond the financial mechanics, the agreement signals momentum for Tasmania’s energy strategy. The state’s approach to energy security involves navigating a complex policy environment, balancing the needs of large consumers with the imperative to transition to cleaner energy sources. The site’s 310 workers on site will benefit from greater certainty as the company proceeds with electrification plans, while Aurora Energy sustains service to a major industrial customer in the community.
stakeholder reflections
Mr. Marriner thanked the many stakeholders who helped reach a mutually acceptable outcome, underscoring the critical role of collaboration in a market with intricate credit and energy considerations. Aurora Energy’s chair, Trevor Danos, welcomed the deal as affirming the bankability of a valued customer and the ongoing partnership with Tasmania’s energy system. The timing and parameters of credit security had been the subject of constructive dialogue since June, with both sides emphasizing practicality and long-term viability.
