Hazelwood power station closure will send Victorian power bills soaring

THE closure of the Hazelwood power station will send Victorians’ power bills soaring by as much as 25 per cent as unions prepare to launch strikes at another Latrobe Valley power station.

The closure of the Hazelwood power station will send Victorians’ power bills soaring. Picture: Jason Sammon

THE closure of the Hazelwood power station will send Victorians’ power bills soaring.

The coal-fired power station, which produces up to 20 per cent of the state’s energy supply, is set to close in March next year with its foreign owners preparing to finalise the decision as early as this Thursday.

It comes as the CFMEU and ETU are set to launch a fresh round of rolling strikes at another Latrobe Valley power station, Loy Yang, sparking fears about a threat to Victoria’s energy supplies.

HAZELWOOD POWER STATION SET TO CLOSE IN MARCH NEXT YEAR

The future of Hazelwood is also threatening to cause problems in the west of the state, where Alcoa is currently renegotiating power contracts needed to keep its Portland aluminium smelter running.

There are 2000 jobs in the region relying on the smelter but the company now says its future “will be decided by its ability to remain internationally competitive”.

Frontier Economics managing director Danny Price said he estimated Hazelwood’s closure would result in power prices increasing by between three per cent and 25 per cent in Victoria.

“The mistake people make when assessing the impact of Hazelwood’s closure is they say there will still be enough electricity generation out there to meet the demand, but you are effectively taking out a major competitor from the market,” Mr Price said.

The Australian Industry Group’s Tennant Reed said power prices were already rising and it was difficult to know how much any future rise could be attributed to Hazelwood’s closure.

“A sudden withdrawal in 2017 would give the market less time to adjust,” Mr Reed said. With Hazelwood’s closure putting at risk 1000 jobs, State Treasurer Tim Pallas yesterday didn’t rule out moving government departments to the Latrobe Valley.

“We know the unemployment rate is rising and this is one of the more disadvantaged areas of Victoria so it’s incumbent on us to come up with solutions,” Mr Pallas said.

The impending closure of Hazelwood comes as the Fair Work Commission has granted applications by unions to ballot the workforce on whether to go on a fresh round of rolling strikes, which could take place as early as December.

The workers represented by the CFMEU have already rejected a wage rise of 20 per cent over four years.

AGL Loy Yang general manager Steve Rieniets didn’t rule out locking out the workforce in response to the union action.

SHADOW LOOMS IN VALLEY

LATROBE Valley residents who lived through the privatisation of the power industry and the Morwell mine fire now fear they will be hit with the expected closure of the Hazelwood power station.

Voices of the Valley president Wendy Farmer said the privatisation of Hazelwood in 1996 hurt the community, and they are scared of history repeating.

Voices of the Valley’s Marianne Robinson and Wendy Farmer. Picture: Norm Oorloff

“Seventeen-thousand people basically lost their jobs then, that’s what the community fears,” Ms Farmer said.

The group wants federal and state governments to stand up for the region.

“Both parties have really let the Latrobe Valley down for a long time. We’re not in this position of high unemployment for nothing,” Ms Farmer said.

With only 48 hours until a decision on Hazelwood’s future is possibly made public, the group wants to be heard: “Just don’t pat us on the head and tell us we’re resilient,” Secretary Marianne Robinson said.

— Bridget Davies

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