NSW could face future energy supply challenges if one of the state’s largest coal-fired power stations shuts down.
The Liddell Power Station at Muswellbrook in the Hunter region today, after owner AGL delayed its planned closure by a year.
AGL initially announced the closure in 2015 after the operator discovered that the plant had ‘reached the end of its technical life’.
The closure means there is 1260 MW less electricity in the NSW grid as three of the remaining seven power sources are decommissioned.
The Liddell plant supplies power to 10 percent of NSW, about eight million people, and those households will instead receive energy from Queensland and Victoria.
“The challenges are great, but the work can be done,” said Penny Sharpe, NSW’s new energy minister.
Ms Sharpe said the network would manage as it lost input from Liddell, but the closure could spell problems for base load power requirements.
The Liddell Power Station in Muswellbrook (pictured) supplied 10 percent of the energy to NSW residents, with around eight million residents expected to be affected by the closure
The plan closure is part of AGL’s commitment to reach net zero emissions by 2050, but everyday Aussies are wondering if the move will push energy prices up (stock image)
‘The net can handle it. Yes, it’s more challenging. But this has been a planned closure for more than seven years, so it’s no surprise,” she said.
“Renewables have come online as well as the other work that is being undertaken.
‘We have to ensure that households and companies in particular can remain connected to the grid, and hopefully not pay too high prices.’
The government has also not ruled out intervening to keep another aging coal station, Eraring, near Lake Macquarie, open beyond its planned 2025 closure date.
Ms Sharpe said the government would work with the operator for years to come.
“The problem here with Eraring is we need to keep the lights on in NSW,” Ms Sharpe said.
“That’s my main job and the job of the Minns Labor government.
“We’ve said all options are on the table as we make this transition, so we’re not saying we’re going to close it in 2025.”
This work would occur at the same time that the government is working on renewable energy technologies, including battery storage technology, she said.
But Nationals Senator Matt Canavan claimed NSW was not ready for the shutdown and warned that utility bills will rise again.
“We’ve got some experts saying there’s enough power, but we heard all these things before the Hazelwood Power Station closed in Victoria a few years ago,” Canavan told Sky News on Tuesday.
The closure is reminiscent of the closure of Hazelwood Power Station in Victoria’s Latrobe Valley in March 2017, which saw power prices double (pictured is Liddell site)
The shutdown, which has been going on for eight years, has sparked fears that the wholesale price of energy will now skyrocket and fall directly on customers (Pictured is the Liddell factory)
“After that closed, we had an absolute energy crisis – electricity prices soared, factories closed and let’s hope history doesn’t repeat itself here.
He said Australia is not replacing decommissioned coal plants with “reliable energy sources” and that efforts to replace them with renewables are not working.
‘Coal power can almost always be on, but investments in solar and wind cannot. In every country in the world where they’ve tried to rely solely on solar and wind investments, you’ve seen higher energy prices and lower reliability,” he claimed.
“What we need now to drive down electricity prices, to ease the cost of living for the Australian people, is to invest in reliable power.
“That must mean coal, gas, hydro or nuclear power.”
The closure of the Hazelwood Power Station in March 2017 doubled or increased power prices to 85 percent – equivalent to an additional $1.8 billion a year falling directly on Victorians.
The station was closed due to rising operational costs, and the site needed a $400 million cash injection to keep it safe and efficient.
Two-thirds of the 180 workers who worked at the Liddell site have been transferred to nearby Bayswater Power Station.