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Lights out at 1GW Wallerawang coal-fired power station

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The 1,000MW Wallerawang coal-fired power station near Lithgow has “switched” the lights out and ceased generation – the largest victim so far of the changing dynamics of Australia’s National Electricity Market.

The impending closure of Wallerawang – bought only recently from the NSW government by EnergyAustralia – was first signalled last year by RenewEconomy after the company informed market operator that it would be removing 1GW of capacity towards the end of March.

The intention was confirmed earlier this year, and on Monday the generation of electricity at the facility’s remaining unit was suspended. That unit, number eight, has been placed on a care and maintenance basis to return to service should demand increase.

Wallerawang is one of a number of coal-fired power stations that have been withdrawn permanently from service or mothballed. These include the Collinsville facility in Queensland, and two units from Tarong, along with the EnergyBrix facility in Victoria, Munmorah in NSW and the Playford B coal fired generator in South Australia. Its neighbouring Northern coal generator is operating only on a seasonal basis.

Gas fired generators are also being impacted by the decline in demand on the main grid, caused by reduced manufacturing output, greater energy efficiency, and the growing trend of households to provide some of their own electricity needs with solar panels.

All these factors are pushing down the cost of wholesale energy, making it difficult for older and less efficient generators to make money. Soaring gas prices are adding to the problems of the gas fired generators, and various plant are being re-purposed as peaking plant rather than base load, and EnergyAustralia has written down the value of its Yallourn coal fired generator and some gas generators.

Wallerawang, along with its larger and more modern neighbouring plant, the 1,400MW Mt Piper power station, was bought by EnergyAustralia for a combined figure of just $160 million in a deal announced in July.

The notice of withdrawal was posted on the AEMO website on September 10, just says after the completion of the purchase, and just three days after Tony Abbott, who has vowed to remove the carbon price that has plagued black coal generators, won the federal election.

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  • Andrew Thaler

    $160 Mil for both is a steal…. why didn’t we all crowd fund that purchase! maybe a quarter of the money would be recovered from Scrapping Wang anyway.
    Unbelievable price tag for Piper… the ‘newest’ coal station in NSW

  • Mark Wakeham

    Energy Australia doesn’t own Hazelwood as stated. I think you mean Yallourn?

    • Giles

      quite so. fixed

  • Zvyozdochka

    This is the only way we’re going to win because there is a class of politicians fighting for business-as-usual (Libs and Labor). The destruction of the coal business model, and the self-destruction of gas is what has to be worked on. Giles, can you please promote this post to Barry Brook and his fossil-nuke friends who say energy transformation can’t be done with renewables?

    • Giles

      Haha. Not too sure those pro-nuke chaps are on receive on this particular notion. They have all the information, they just don’t want to process it. Solar and distributed energy are their worst nightmare. When even the likes of NRG’s David Crane, who owns and operates a bunch of nukes, says the economics of them don’t work and it is all too hard, then you can rest assured the economics of them don’t work and it is all too hard. China and a few other countries will be the exceptions.

  • An Idea

    Hey Giles,
    it seems like these dirty power stations are dropping like flies… would you be able to produce a dedicated page or info-graphic that lists them all in Australia and their status?

    It could give the climate concious community/businesses a few ideas on which area’s to target for solar panels, efficiency improvements and so on deployment. Is there a big, old dirty brown coal plant at location X? Well then lets focus on reducing power in that region and get another plant to stop killing this planet!

    • Giles

      Good idea for a resource. not too sure tho that that is best way to target solar installations. best way is simply to install them where they make sense, which is most places, and their impact will still be felt.

  • Andy

    Hi
    Is there an analysis that has been done on rates of coal fired power station construction & de-comissioning ?
    There is a reference here of plants here : http://en.wikipedia.org/wiki/List_of_power_stations_in_Australia
    Its tedious to go through, which is why I ask if there is an analysis, but it looks to me as if most new coal fired power stations are being built in WA/QLD ? No news ones in NSW or Victoria ?

    • Zvyozdochka

      As far as I’m aware in Collie, WA, Blue Waters #2 is the last coal power station built in Australia. That was completed ~2005/6. I don’t believe there are any even in planning in the rest of Australia. Certainly not for wholesale electricity.

      • Giles

        There is actually about 3000MW of coal fired projects in planning stage, according to AEMO data. Not likely that any will get built, although there is big push from north Qld to build them.

        • Zvyozdochka

          I guess it’s a definition thing. I was working from here;

          http://www.aemo.com.au/Electricity/Planning/Related-Information/Generation-Information

          Tables describe projects as “publicly announced”, “advanced” and “committed”. Advanced usually means progressed to planning/application. Committed = permitted/approved and being financed.

          Anyway, those dirty things won’t be going anywhere. No-one will finance them AT ALL.