Government seeks to delay coal-fired power plant closures

Aerial image of Origin Energy's Eraring Power Station (fire)
Eraring Power Station

The federal government is seeking to introduce new rules to force energy companies to provide five years’ notice before closing coal-fired power stations, with Energy Minister Angus Taylor saying earlier-than-expected closures could lead to electricity instability and price hikes.

Under the current rules set by the Australian Energy Market Commission (AEMC), electricity companies need to provide at least 3.5 years’ notice of an upcoming closure.

Related article: Australia’s largest coal plant, Eraring, to close in 2025

Minister Taylor says that period does not give the sector long enough to invest or develop new projects that could replace the electricity provided by closing plants.

“Without this rule change, there is a risk that retiring capacity is not replaced in time or is only able to be replaced with inadequate or inefficient options that are available in short time frames, risking the reliability, affordability and security of the system,” he said in a statement.

If accepted by the AEMC, the rule change would not affect closures that have already been announced, such as Eraring or Liddell.

The Australia Institute’s climate and energy program director Richie Merzian said the federal government’s proposed changes was no substitute for a real roadmap.

“What we are seeing is another knee-jerk reaction from Minister Taylor because Australia’s Energy Minister was left out of key negotiations on Australia’s largest coal plant closure in the country,” Merzian said.

”Minister Taylor must be suffering from a bit of FOMO with plant closure deals being stitched up behind his back.

“It raises eyebrows that a government so resistant to planning a roadmap for Australia’s coal closures is now apparently so keen for longer plant closure notice periods.

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“It is abundantly clear that coal plants are going to accelerate their closures, closing faster than their official retirement dates. If this government was genuine about providing certainty to coal communities, it would develop a national coal closure roadmap rather than attempting to strong-arm coal plants one by one.

“Failure to develop a coal closure roadmap leaves workers and communities without support or a plan for the future.”

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