AURORA Energy and the Tasmanian Government have issued brief statements to New Norfolk and Derwent Valley News in response to union claims that the state-owned power company had put 300 jobs at risk by demanding a $7m bank guarantee from the Boyer paper mill near New Norfolk.
“Aurora has inexplicably demanded $7m in bank guarantees from the new owners of the Boyer paper mill which could force its closure,” the Communications, Electrical and Plumbing Union (CEPU Tasmania) and the Australian Manufacturing Workers’ Union (AMWU) said in a statement this morning.
“It stems from an obscure condition in which Aurora can demand bank guarantees for the provision of energy to a site if there is a change in ownership. If the new owners of the site don’t comply within a matter of days, they have threatened to cut supply to the site which would be the end of the operation which has continuously run for over 80 years,” said CEPU state secretary Chris Clark and the AMWU state secretary Jacob Batt, when condemning the demand from Aurora.
A Tasmanian Government spokesperson said: “We are aware of the ongoing discussions between Aurora and Boyer, which have been underway for several months. We expect them to continue in good faith.” The government noted that Aurora Energy had credit security requirements with all its major customers.
An Aurora Energy spokesperson said the matter was highly commercial and sensitive but the power company had several points to make:
Since June 2025, Aurora Energy has been engaged with the new owners of the Boyer Mill on the provision of “credit security” for its electricity costs.
Throughout these discussions Aurora Energy has been constructive and flexible with Boyer management on the timing and parameters of credit security.
The credit security requirements applied to the Boyer Mill are entirely consistent with the treatment of all other large electricity users in Tasmania.
Aurora Energy will continue to work with the owners of the Boyer Mill and engage productively on the future energy use at the New Norfolk site.
The union spokespersons said the issue raised many questions about the way public assets were managed. “Why didn’t Aurora do this with the previous owner – that foreign owned shell company which owned Boyer – as opposed to having local ownership trying to map out an actual future for the site?” Mr Batt said.
The Unions understand that the company is calling a meeting on site next week to update workers on the situation. “The government has a big decision to make: allow our energy retailer Aurora to be the latest government owned business to make another woeful call against the interest of Tasmania, or treat Boyer the same way it has for 60 years and give it the best chance to succeed and provide employment to over 300 people and their families, as well as 1000 indirect jobs? Let’s not forget, the mill also contributes $180M to the local Tasmanian economy,” Mr Batt said.
“It’s well past time for an inquiry to be held into the conduct of our government owned utilities. They all used to operate to provide the cheapest services and good jobs and now they seem to work in the opposite,” Mr Clark said. “The mill already pays $44m in energy costs annually, it’s ridiculous that this site’s history of compliance for a critical resource would be ignored at such an important time while it gets back on its feet.”
“Everyone knows the mill was in strife and the new owners are trying to turn things around after years of neglect and mismanagement by the former owners, but its beyond strange now for a government to put a $7m gun to the head of rebuilding business and given it would effectively sink the company, it simply cannot happen,” Mr Clark said.
“This would be one of the worst breaches of trust and betrayal of Tasmanian workers by a government that we’ve seen,” Mr Batt said. This view was echoed by the State Opposition: “Labor is calling on the government to ensure operations and jobs at the Boyer paper mill aren’t impacted after unions today raised the alarm about power supply contracts to the site. The mill employs 300 workers and contributes $180 million to the local economy,” opposition energy and renewables spokesperson Janie Finlay said.
“Aurora may be taking a zero-risk approach to its bond negotiations, but by doing so, it is greatly risking Tasmania’s economy and the contribution the Boyer paper mill makes to it. Tasmanian Government businesses should be working for the best interests of the state. This is not the first time we’ve heard of Aurora being inflexible in bond negotiations with key employers. The Premier and Minister for Energy should step in and make sure a resolution can be found,” Ms Finlay said.
“Tasmania’s major industrials are our economy’s engine room. One of the levers government has to support them is energy, and they should be doing everything they can to encourage growth and support jobs. Boyer’s efforts to future-proof the mill by converting boilers from coal to electricity have already been hampered by a lack of available power under this government. Tasmania’s economy can’t afford to lose the contribution of our major industrials, and the Government must ensure operations and jobs at the Boyer paper mill aren’t impacted.”
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[SRC] https://newnorfolknews.com/2025/10/paper-mill-reeling-from-power-bill-shock/
