The Te Rapa plant in Waikato, New Zealand has been operating since 1999 and provides steam and electricity to the world's biggest dairy exporter Fonterra's Te Rapa dairy factory under an ongoing agreement expiring in June 2023.

After shutting down the plant, Fonterra will buy its auxiliary boiler and continue to use these assets for its dairy operations, it said.

"There will be some opportunities for people to move across to Fonterra's Te Rapa team or be redeployed elsewhere within Contact," said Chief Executive Officer Mike Fuge.

The shortfall in energy output due to the Te Rapa shutdown will be covered by new, renewable generation that will ramp up over the next years, Fuge said, noting that 83% of Contact's electricity supply is renewable.

(Reporting by Roushni Nair in Bengluru; Editing by Richard Chang)