Australia’s dirtiest power station - the 2.2GW Loy Yang A brown coal generator in Victoria - will continue to operate until 2035 under a new deal struck with the state government which effectively kills hopes that Australia could reach 100 per cent renewables before that date.
The 2035 closure date is consistent with AGL’s commitment announced nearly a year ago, when it brought forward the closure date by a decade under pressure from activist shareholder Mike Cannon-Brookes, and climate campaigners and scientists.
The confirmed closure date fits in with Victoria’s own target of reaching 95 per cent renewables by 2035 - although that doesn’t fit with the closure plans of the neighbouring Loy Yang B coal fired power station, owned by Alinta, which is still set for 2047.
It would also avoid an unplanned closure of Loy Yang A before the scheduled closure date “Through a risk sharing mechanism that will apply in the event of adverse market conditions transpiring before the scheduled closure date.”
The confirmation of the closure data was hinted at last week when AGL announced an extension to its power supply deal with the massive Alcoa smelter in Portland.
https://reneweconomy.com.au/eraring-and-loy-yang-a-coal-closure-wrangles-show-need-for-hard-renewable-targets/
In some ways it is: Victoria has a hard, legislated target for 95 per cent renewables, which means there is no place for either Loy Yang A, or its half sibling Loy Yang B on the state grid beyond that date.
Now the attention is turning - again - to Australia’s biggest coal generator, the 2.88GW Eraring coal plant in NSW. Its owner Origin Energy has for some time flagged its “Intention” to close the plant as early as August, 2025, although this has never been “Locked in.”
He put the renewable infrastructure roadmap into place - and legislated it - but there are no fixed times for coal exits or renewable targets.
Environmental activists point out that paying hundreds of millions of dollars a year to keep Eraring open is not needed, and that two reports - including “The Lights Will Stay On” by the Climate Energy Finance and “Earing can be closed on schedule” by Nexa Advisory - outline why and how Eraring should close.
The CEC’s Kane Thornton says keeping Eraring open will simply make it worse for renewable energy investors.
In a mid 2022 report coal was 26% of Victoria’s generation capacity and the majority of that was the Loy Yang power plant (which has six coal generators, four at the A facility and two at the B facility).
From the article, they haven’t specified an end date for Loy Yang - what they’ve done is some kind of deal that guarantees Loy Yang won’t shut down if the grid doesn’t have an alternative in place yet. That seems fair enough to me? Nobody wants blackouts.
I would expect the six generators at Loy Yang won’t all be shut off at the same time. They’ll go down one by one as wind/hydro infrastructure improves.
Also - remember “95%” is a moving target. There’s ~20GW of wind power and ~8GW of battery power coming online in VIC over the next several years and that only counts major projects, it doesn’t count residential solar/batteries which are growing at a rapid clip. VIC will likely their 95% target long before Loy Yang shuts down.