EnergyAustralia forced to reaffirm its plans for Yallourn, amid media coal panic

EnergyAustralia has been forced to issue a statement clarifying its plans for the Yallourn power station, following speculation that the growth of renewable energy in Victoria may force the ageing brown-coal power station to close early.

Speculation has abounded after Victorian Premier Daniel Andrews was not able to rule out the closure of the Yallourn Power station within the next 10 years.

Since the closure of the Hazelwood power station in 2017, the 1480MW Yallourn power station has become Australia’s most emissions-intensive power station, producing more than 1.3 tonnes of carbon dioxide equivalent emissions for each megawatt-hour of electricity generated.

Andrews, speaking to media ahead of a meeting of COAG leaders in Canberra, pointed to the support the Victorian government was providing to boost the amount of renewable energy generated in the state as helping Victoria prepare for its brown-coal fleet to exit the market. However, he fully expected EnergyAustralia to honour the five-year notice of closure requirements introduced by the COAG Energy Council.

In response, EnergyAustralia was forced to release a statement clarifying its plans for the Yallourn power station, saying that while it still plans to decommission the power station in 2032, it would respect the five-year notice of closure period, should the need arise to close the power station “should things change”.

“The Yallourn power station generates enough electricity every day to supply 2 million Australian homes. More than 500 people work at the plant and it spends millions of dollars every year with local businesses.” EnergyAustralia said in a statement.

“We’re working hard to make Yallourn more efficient. At the same time, we continue to talk to stakeholders, including our workers and the community, to support opportunities and plan for the transition already underway in the Latrobe Valley. And we’re investing to modernise Australia’s energy system with new, cleaner power generation.”

“Australia’s shrinking capacity to generate reliable energy has been a major cause of rising household power prices. Losing Yallourn’s electricity supply would, without careful planning, compound the problem and impact the local community.”

“Our plans are to run the plant to 2032 or for as long as policy and regulation permit, and there’s not a substantial change in the market.”

“We have promised our workers and the local community that, should things change, and circumstances remain within our control, we will give at least five years’ notice before closing Yallourn.”

In light of the statement, Environment Victoria’s campaign manager Nicholas Aberle pointed to the combined realities of the need to address climate change and the operating age of the Yallourn power station meant that it was indeed realistic to expect that the power station may close sooner than 2032.

“Yallourn power station is the dirtiest in the country and one of the most unreliable. It is responsible for around 15% of Victoria’s greenhouse gas emissions.” Aberle said.

“If we intend to do anything about the climate crisis facing us, Yallourn and other coal-burning power stations like it will need to close much sooner than currently anticipated.

“The key now is to ensure we are building enough renewable energy and storage capacity to replace Yallourn’s output before it closes, and to scale up efforts to create new sustainable jobs in the Latrobe Valley.”

As reaffirmed in the statement from EnergyAustralia, Yallourn has been earmarked for closure in 2032, which is the end of the aging plant’s “natural” operating life. The brown-coal power station has faced an increasingly difficult operating environment, as reliability starts to take its toll.

More than 500 workers are currently employed at the power station, which generates around one-fifth of Victoria’s total electricity generation.

Analysis from the Australia Institute rated Yallourn as one of the least reliable coal or gas generators in the National Energy Market, with 26 outages over the last two and a half years.

Yallourn’s owner EnergyAustralia has also been impacted by government intervention in the retail electricity market and was forced to take a hit of $1.3 billion to its balance sheet through a write-down of its “goodwill” attributable to the business.