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Western Australia is delaying closing one of its coal-fired power plants after a new report revealed the state could face a shortfall in electricity supply by 2025.
Key points:
- Muja was originally slated to close in October next year
- The government says it'll stay open longer to ensure WA power supplies
- Blackouts are forecast from 2025 if nothing is done
Last year, the government committed to phasing out coal-fired power plants by 2030, in a plan that put WA's prominent coal town at a historic crossroads.
The Muja 6 plant was due to close in October 2024, but that will now be delayed until April 2025 after a report from the Australian Energy Market Operator (AEMO) flagged increased demand could lead to a shortfall.
AEMO said rising demand over the next decade was being driven by increased use of electrical appliances and vehicles alongside rising industrial demand.
It suggested WA could face electricity blackouts as soon as 2025 unless it fills a forecast shortfall in energy supply.
AEMO's WA managing director Kate Ryan told ABC Radio Perth population growth was a driving force.
"We're also seeing some growth in our large industrial use, so that's by existing industrial customers but also new ones, so when you think of lithium mines and processing facilities that are being announced."
She said the report found peak demand was set to grow by about a third over the next decade.
Keeping the lights on
Each year the market operator forecasts how much reserve capacity is needed in WA's electricity supply networks to protect it from power outages.
This year it forecasts the need for 945 additional megawatts (MW) — equivalent to a coal-fired power plant — in that reserve by the 2025-26 financial year.
That balloons out to an additional shortfall of 4,000 MW by 2032-33, a huge jump on what was forecast in last year's report for the same period, which was 303 MW.
This year's report is the first time AEMO has given a forecast that takes into account WA's commitment to transitioning off coal-fired energy by 2030, which it says would strip an estimated 1,366 MW of power generation out of the system.
AEMO is calling for urgent investment in the state's generation, transmission and storage systems to make up the forecast shortfall.
"What we really need is investment to make sure that we don't have [a problem] keeping the lights on into the future," Ms Ryan said.
Energy Minister Bill Johnston said he believed the report showed the staged retirement of WA's coal-fired power stations "could be accommodated".
But he said the planned closure of the Muja 6 power plant would be delayed to assist.
"We've always said we would adjust the retirement dates to take account of the situation," he said.
Ms Ryan said while the agency was committed to decarbonising the state's energy system, renewables were unlikely to form 100 per cent of supply any time soon.
"Obviously wind and solar continue to play a really important role in our sector but they need to be backed up by things like batteries and traditional power plants like gas plants," she said.
"Because of the role gas plays as a peaking power plant, so you only turn it on for short periods of time when demand is incredibly high or we have one of those risks eventuate, it doesn't actually leave a big emissions footprint.
"So you really can see gas playing a key role in our mix right up potentially into the 2040s, and beyond that, it's probably too early for anyone to make that call."
Prices will go up: Opposition
The WA opposition's energy spokesman Steve Thomas said the delay in closing Muja revealed the government's energy transmission plan was flawed.
"The current plan for transition, with its lack of investment, in generation, in transmission and in storage will drive up the cost of electricity for every consumer in Western Australia," he said.
Mr Thomas dismissed Mr Johnston's suggestion that private investment would make up the shortfall in energy generation, saying it would not work.
"They can't simply outsource its planning and development to the private sector because there's no guarantee that we'll get there," he said.
He said the government must consider keeping coal-fired power going until transition was possible, or invest more in gas generation, or a combination of the two.
Mr Johnston did not rule out further investment in gas generation.
"The government has already said that we would not rule out new gas-fired peaking plants here in WA and we continue to say exactly what we've said for the last five years today, which is that if there needs to be additional peaking capacity built into the system, then that's an option," he said.
Town's transition to continue
Coal fired-power is the time-honoured lifeblood of Collie, a community about 9,000 people call home in WA's South West.
Local mine worker Shannon Boston said the workforce and locals were continuing to roll with the government's repeated changes.
A production operator at Premier Coal for 14 months, Mr Boston said contact from the ABC was the first he'd heard about the Muja announcement.
"It wasn't completely unexpected," he said.
"I assume it's something to do with that they haven't really put the measures in place to get it ready for closure.
"So they're going to get measures in place for it to close smoothly, not abruptly."
He said the move towards the end of coal mining was a gradual process for residents of the mining town.
"I don't think anyone thinks they're up to spec with it yet, they're still getting ready," Mr Boston said.
"I don't think [today's announcement] will change much in the Collie community."
He said there was scope for the communication of these announcements to the local community to be improved.
"We're not kept in the dark," Mr Boston said.
"But it does take a little bit of time for information to get around to everyone."