Tomago Aluminium, near Newcastle, uses about 10% of NSW's electricity and supports around 1,000 jobs.

With its long-term coal power contract running out in 2028, the smelter said it would be forced to close.

The federal and NSW governments have committed $2.5 billion to keep it open, with Snowy Hydro buying power from new wind and solar farms and selling it to the smelter at a fixed price.

The smelter's owners, including Rio Tinto, invest $1.1 billion back into the plant, and the government takes a cut if aluminium prices rise.

The National Account's Archie Milligan has the rundown: