W.A. backflips on loss-making coal generator, promises more subsidies to keep plant open

The Western Australia government has agreed to extend subsidies to the state’s only privately coal generator, less than six months after declaring it “will not be on the hook” for any further payments.

The Cook Labor government has already provided more than $300 million to the Griffin coal minesince late 2023 to ensure it continued supplying coal to the Bluewaters generator until at least mid-2026, but now cites delays in transmission projects and new wind and solar as the reason to provide more funding.

“Coal will be needed to underpin energy security as we build transmission lines to connect large scale wind and solar projects to our power grid,” premier Roger Cook said on Wednesday, according to the ABC. He would not say how much money would be required.

“I will reveal all those costs in parliament once the agreements have been finalised,” the ABC quoted him as saying.

W.A.’s state owned generators in Collie are scheduled to shut down by 2029, and the city has already become the host to the two biggest battery storage projects in Australia – owned by Neoen and Synergy. But the state has built little in the way of new wind and solar, and now it wants to extend the life of Griffin to ensure there are no gaps.

The Mining and Energy Union welcomed the announcement, which it said would see a five year extension to Griffin Coal’s operations, and allow the loss-making Ewington mine to continue its operations.

“With the current funding arrangements coming to an end, the Government’s commitment to extend support for a further five years is a practical and responsible intervention that will keep people in jobs and give workers and the Collie community the certainty they need during the transition,” MEU district president Greg Busson said.

“If the Cook Government wants to reassure investors, industry and consumers that it’s serious about providing lower cost energy security, it would commit to a 2030 Renewable  Energy Target,” CEO John Grimes said in a statement.

Grimes said confidence in the energy transition depends on governments showing that legacy arrangements for uneconomic and unreliable energy infrastructure, will not crowd out investment in modern, lower-cost alternatives.

“Firmed renewables, supported by batteries, transmission and smarter system design, are now consistently the lowest-cost option for new generation,” he said.

“If energy prices are going to come down, it will be because governments are disciplined about shifting investment toward infrastructure that permanently lowers costs, rather than prolonging arrangements that were never designed to deliver long-term value.”

State energy minister Amber-Jade Sanderson said the government remained committed to retiring the state owned coal generators by the end of the decade.

“Renewables firmed by batteries and gas is the least cost mix for households and businesses – and that is what we are delivering,” she said in a statement.

“Extending the State Agreement is a sensible, pragmatic step to provide certainty for industry, the Collie community and the power system as we deliver the energy transition.”

If you would like to join more than 29,000 others and get the latest clean energy news delivered straight to your inbox, for free, please click here to subscribe to our free daily newsletter.