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Brislen on Tech: A future without Tiwai Point

Paul Brislen, Editor. 10 July 2020, 2:00 pm

Putting aside for the moment the US$8 billion profit Rio Tinto made last year, the company has decided to pull out of New Zealand and to close its Tiwai Point aluminium smelter.

The immediate impact will be around 1000 full time staff will lose their jobs, the listed companies in New Zealand's electricity sector will lose value on the stock market and countless dozens of people on the internet will become overnight experts in carbon emissions, employment law, legal requirements around mothballing a smelter, electricity transmission and goodness knows what else.

While it is desperately unfortunate for those people who are directly affected, in one of the areas of the country with high unemployment rates already, for the country as a whole this move requires some serious decision making by our political leaders.


Tiwai is one of the smaller smelters in the world and has been deemed borderline for many years. Every election cycle for as long as I can remember the company has pulled a PR stunt "review" of its operation and eeked another year's worth of subsidies out of central government. Every year government says that's that, and this time round the current lot seemed quite firm on the idea, so that's probably that. Never mind US$8 billion in profit, Rio Tinto has shareholders to consider.

But Tiwai also uses around 14% of New Zealand's electricity (although not as clean and green as it should be) and freeing that up for other uses offers some tantalising opportunities.

First off, an old chestnut. In 2012 (the last time I wrote about Tiwai bailing out) I suggested we build some giant datacentres in New Zealand and ship data to the rest of the world.

Mega datacentres are typically based in Oregon because it's cold (good for the air conditioning costs), remote and the land is cheap. The downside is the power is incredibly dirty (mostly coal powered) and for some of the world's tech companies that's not a good look, brand wise. You've seen them building giant solar arrays in the desert - that's to balance out the noxious power used in these kinds of facilities.

We don't have to worry about that. Land in Southland is very cheap, it's cold and inaccessible and Southland is more stable than most countries both politically and geologically (well, for New Zealand levels of stability of course).

In 2012 there were two problems with the idea. Three if you count the lack of political will to think about it for one second.

The first was that we had precisely one company providing internet access into and out of New Zealand - The Southern Cross Cable Network. Two cables landing on either side of an active volcanic field less than 30km apart.

Not a terribly resilient set up.

That's been largely resolved as today we have multiple networks and not all land in Auckland, so that's one problem ticked off.

The second problem is tougher - it's the speed of light. It's pretty fast but there is a noticeable lag when accessing data that's too far away from the user and most users are in that strange place called "not New Zealand". Latency is a killer in any real-time applications and these days even web browsing is considered real time.

But there are ways round that. Newer threaded browsing apps allow multiple streams to open up so users are watching the start of the video content while the rest still downloads in the background. And not all content needs to be actually "real time". For plenty of our content fake real time is good enough. You press play, it buffers, then starts up. Or you download your document and it downloads and then you open it.

It simply isn't the game killer it once was.

However, we are late to the party and since writing in 2012 Australia (hot, dry Australia) has convinced most of the big guys to set up over there.

So what else can we do with an extra 14% electricity production overnight? Well we could smooth out some of the peaks and troughs of our current delivery system, which has high dramas in summer and winter. We could reduce the price right across the board, once we've invested $500 million in getting the power out of Southland (work that's already underway, so someone's been thinking).

We could take the opportunity this presents and start looking hard at upgrading our vehicle fleet to all-electric ahead of anywhere else in the world. Cars, buses, trains, bikes, scooters, even ferries, they're all electric now. If we made a leap like that off the back of extra supply being made so readily available we could put a real dent in our carbon emissions and lead the world in reducing our footprint.

I think that's got my vote, because while COVID is all consuming now, we really need to not forget about climate change and what that means for the next 100 years of human civilisation. The outbreak is everything right now but we can get over it - having a cinder instead of a planet might be a tad more difficult.


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