Australia's Last Paper Mill Told Power Grid Can't Support Electric Conversion

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The Boyer paper mill in Tasmania, one of Australia’s oldest industrial sites and the country's last remaining newsprint manufacturer, is planning a major shift away from coal. Since opening in 1941, the mill has relied on coal-fired boilers to generate steam essential for producing paper. But now, new owner David Marriner wants to transition the facility to electric boilers in an effort to drastically cut emissions. The proposed change is expected to reduce the mill’s on-site carbon output by around 95 percent—an amount comparable to taking a third of Tasmania’s cars off the road.

Marriner has alredy sourced the new boilers from a Norwegian company, and they are set to be installed in roughly 15 months. However, there’s a major hurdle: Tasmania’s electricity grid doesn’t currently have the capacity to meet the mill’s increased energy demand. The electric boilers will need an extra 45 megawatts on top of the 100 megawatts the mill already consumes. Hydro Tasmania, the state’s main energy provider, has told Marriner that the only immediate options to cover the shortfall are activating gas-fired generation or importing electricity from Victoria—both of which would raise costs.

This has created significant uncertainty for the mill’s future. Marriner warns that without affordable electricity, the entire operation could become unviable, putting the jobs of nearly 300 workers at risk. He expressed frustration at the lack of grid readiness, particularly as the planned shift aligns with broader state and national emissions reduction goals. Hydro Tasmania CEO Rachel Watson said the island’s power system is currently in balance, and large new industrial loads would require interim solutions until more local renewable generation is available.

Despite the challenges, Marriner remains committed to removing coal from the site. But without a viable power supply plan in place, the transition could stall—potentially jeopardizing one of Tasmania’s key manufacturing assets.

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Should governments and utilities be required to fast-track grid upgrades for industrial decarbonisation projects like this?