Australia’s largest coal-fired power plant will close seven years earlier than planned, joining a growing list of plants forced to go offline in the country due to the rise of solar and cheap wind.
The plant’s owner, Origin Energy, a major gas and utility producer, said the 2.88 gigawatt Eraring power station, located in the coal-rich Lake Macquarie region north of Sydney, could not compete with ” renewable energy stream” and will close in 2025.
“The Australian energy market today is very different from what it was when Eraring went online in the early 1980s,” said Origin CEO Frank Calabria. “The reality is that the economics of coal-fired power plants are under increasing pressure, unsustainable by cleaner and lower-cost production, including solar, wind and battery power.”
The federal government, which has been trying to extend the life of the country’s coal plants on the grounds that they provide the basic energy needed, has called the decision “bitterly disappointing”.
Environmental and renewable energy groups welcomed the decision, but called for a more coordinated national approach to ensure an orderly transition.
“These accelerated retirements need to be coordinated to ensure our electricity system remains resilient through this rapid transition and,” said Kane Thornton, CEO of the Clean Energy Council. so that we maximize opportunities for local economies.”
Last week, utility giant AGL Energy announced it would close two of its coal plants. EnergyAustralia, the third of three major utilities, said last year it would decommission a coal plant in Victoria five years earlier than planned. All three companies have seen earnings from coal production plummet in recent years.
Australia depends on coal-fired power to nearly 60% according to World Bank data.
The country’s rapid move away from coal has raised concerns that there won’t be enough power to back up intermittent wind and solar power, leading to a rivalry between state and state governments. federally to fill the gap with batteries, pumped hydro and gas plants.
Tony Wood, energy analyst at the Grattan Institute, said the federal government has failed to develop a consistent national energy policy.
“In Australia, more than in most countries, even the United States, we have seen politicize of climate change. It becomes an important political weapon and when politicians have political weapons they use them,” he said. “Australia has abandoned more climate change policies than almost any other country in the world.”
This means Australia’s transition from a coal-dominated grid is increasingly disorderly, Wood added. “That doesn’t mean the lights will go out, but it does mean it’s going to be messy, ugly, unpredictable, and it’s probably going to be more expensive,” he said.
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