Watch: Hundreds of jobs under threat as rising power prices could close two mills

Monday, 5 August 2024

Workers at Winstone’s pulp and timber mills have been told to lay down their tools.

The two mills employ around 300 people.

Soaring electricity costs mean it has become too expensive to keep the mills running.

Families in Ruapehu are on tenterhooks.

The workers of Winstone’s pulp and timber mills, almost 300 of them, have been told to lay down their tools.

For Ohakune, home to about 1000 people - the loss of up to 300 jobs has locals worried.

The two mills, which sit on State Highway 49, between Ohakune and Tangiwai, are vital employers for the Ruapehu District. The Karioi Pulpmill produces 220,00 metric tonnes of high yield pulp.

The Tangiwai Mill produces timber needed for housing, farming, and pallets - which is exported across the globe.

But the soaring price of electricity means it’s too expensive to keep the mills running, according to its owner.

The company now has two weeks to try and find a plan to remain in operation.

Winstone chief executive Mike Ryan said they can’t go on with electricity now 600 per cent more expensive than it was in 2021.

Regional Development Minister Shane Jones said the price of electricity needed to lower. Last week, he said New Zealand was paying the most for electricity in the developed world.

In a statement, Ryan said his team had done everything possible to stay in business. This involved investing into new equipment, cutting electricity use by 30%.

But even then, he said that wasn’t enough when overseas competitors were still paying less than $100 per mega watt hour.

Winstone’s leaders would meet with ministers later this week.

But it’s unclear if the Government is willing to step in to save these jobs.

Jones said there needed to be pressure, potentially an inquiry, to push down power prices.

For the workers, and families of Winstone, it is an anxious wait to see if the power brokers will save their livelihoods.