NSW Premier warned not to let Eraring power station close without working alternative

Closing a major power plant without the back up to replace it will lead to power shortages and price rises, hitting industry and consumer wallets, a new report warns.

Coal fired power stations like the one at Eraring in NSW should not be allowed to shut until there is enough reliable generation in the system to pick up the slack and keep the east coast power grid from tipping over into crisis, a new report has warned.

Instead, a new report from the Institute of Public Affairs released on Tuesday claims governments need to intervene to prevent the closure of plants such as Eraring, warning that “no baseload power station should be allowed to close unless and until a like for like baseload replacement – be it coal-fired or nuclear – is ready to come online.”

According to the IPA’s analysis, renewable energy targets mean that other dispatchable base load power stations will also be forced to close sooner than anticipated or curtail their output, leading to higher prices and instability.

The report also notes that despite the optimism of renewables advocates, “the state’s entire network of large-scale wind and solar projects provided about the same amount of electricity” as Liddell in its last year of operation.

Pointing to projects like Snowy 2.0, which is massively behind schedule and over budget, the report warned, “not only will (renewables) projects not be built in time, they will be increasingly expensive which will simply add to energy consumer pain.”

Eraring Power Station in the NSW Central Coast.

The report also pointed to delays to the Kurri Kurri gas power station but added that “New South Wales’ only option is to rely on its network connections to Queensland and Victoria to import even more electricity”.

“But as Hazelwood’s closure showed, the integrated (east coast grid) also allows the export of reliability risks and higher prices to other states,” it continued.

Workers at the Tomago Aluminium Smelter, which could face brownouts if Eraring closes with no viable alternative. Images supplied by Adam Taylor/PMO

“What is occurring in Australia has already been tried, and has failed, elsewhere. Germany and California offer sobering lessons for Australia on the risks of moving towards a higher level of dependence on renewable energy,” the IPA’s executive director Scott Hargreaves said.

“For too long Australia’s energy network has been used as an experiment by ideologues who want to impose their renewable energy dreams, without taking into account how we actually keep the lights on.”

ANU professor Tony Irwin warned that as a net importer of electricity, NSW would become even more dependent on other states to keep the lights on even as neighbouring states shut down their own coal and gas plants.

“You can keep edging nearer and nearer this cliff but eventually you have to do something else.”

Mr Irwin said that Australia should look at placing new small modular nuclear reactors on the sites of old coal stations as the infrastructure to connect them to the grid already exists and power station workers can easily be retrained to maintain a reactor’s turbines.

Premier Chris Minns did not rule anything out saying, “The proposed closure of Eraring in 2025 is a challenge for energy reliability. That is why all options are on the table when it comes to Eraring.”

“At the same time, our focus is on delivering as much renewable energy into the grid as soon as possible so we have affordable, reliable energy for NSW households and businesses.”