The New South Wales government is expected
to announce that it will extend the operations of Australia’s biggest coal-fired power station for as long as four more years.
According to several people who have been briefed on the plans, the decision involves providing taxpayer subsidies to Origin Energy’s Eraring power station for two years with permits to run for two more.
The cost of the subsidies are due to be discussed by the Minns government’s expenditure review committee as soon as this Friday. Environmental groups and local MPs were also due to be briefed on the plans later this week and prior to 10 May.
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Unlike most of its competitors, Origin does not have long-term contracts for the four-unit plant. The subsidy would be aimed at capping the price of coal but may also extend to other aspects of the plant’s operations including an expansion of its coal-ash dams.
“They are responding to the demands of the fossil fuel sector,” said Tim Buckley, head of Clean Energy Finance, who has compiled reports on how NSW can retain a reliable power system without Eraring. “They will be using taxpayer funds to crowd out private capital” that would otherwise be investing in renewable energy, he said.
In March, Buckley estimated that keeping the power station operating could cost the government as much as $150m a year for just two of its four units.
The previous Perrottet government had been told it could cost the government as much as $1.6bn to keep Eraring running for 18 months, Guardian Australia has been told. That sum, though, involved capping the price of thermal coal when it was trading near its peak in the wake of Russia’s invasion of Ukraine.
Story was adapted from the Guardian.
