Point of Order: Price of power looks likely to become an issue, now that the Tiwai Point smelter wants to keep operating

A shot in the arm for the province of Southland came this week with the news that the Tiwai Point aluminium smelter will not shut down in 2024 — and could have a long term future.

Since the global giant Rio Tinto renegotiated the last electricity contract, extending the life of the smelter for three years from 2021, the price of aluminium soared as high as $US3800 a tonne, and although it has retreated from those levels, it is still high at around $US2400.

And because the aluminium produced at Tiwai Point is among the purest in the world, it is not surprising that Rio Tinto, and its Japanese partner, Sumitomo, want to continue production.

Bob Edlin: Rio Tinto deal with the Ardern govt includes Ngai Tahu

Rio Tinto strikes a deal with the Ardern govt on cleaning up its mess – and it brings Ngai Tahu into an array of commitments.

Should we really be cheering news of a giant global company picking up the tab for cleaning up its own mess? Surely that’s what it should be doing.

But hey, we are talking about Rio Tinto, a company widely criticised by environmental groups around the world and at least one national government for the environmental impacts of its mining activities. Or so we are told by Wikipedia.

And it has been a dab hand at persuading governments in this country to help power its aluminium smelter operations near Bluff at a modest cost.

But the PM, helped by some of her ministerial team., has urged the company to do something about its toxic waste and – hurrah – the company  has obliged.

The company has made a raft of commitments, including recognising Ngai Tahu (a least by the looks of things) as an organisation akin to a co-governor.

Mike Hosking: Rio Tinto's relationship with Govt feels like a hostage negotiation

 I think we can all agree that Tiwai going nowhere is a good thing. But that’s not the real story - or at least it shouldn’t be.

Tiwai is a lesson in why this country in parts needs to get its act together.

The clue here is the balance of power - no pun intended.

Does Tiwai need Southland or New Zealand? No. Does Southland and/or New Zealand need Tiwai? Yes.

And in that is the clue as to why they’re not going anywhere.