Global funds giant Brookfield, likely the new owner of Australian utility Origin Energy, has extended the operation of the New South Wales Labor government’s Eralling coal-fired power plant and even bought it back into public ownership. objected to the proposal to convert .
Brookfield Asset Management Chairman Mark Carney said the board had approved a $18.7 billion buyout from an Origin-led consortium, with $20 billion in wind, solar and storage over the next seven years. Having grand plans to spend says to keep the errands open. Not aligned with climate goals.
Eraring is Australia’s largest coal-fired power company with 2.88GW and is currently scheduled to close in August 2025, but its future has been hotly debated since the election of the Labor State government, which proposed to buy it back from Origin and keep it. It is targeted. Long working hours.
This has caused considerable concern in the market as it will send a signal to investors and because of its impact on emissions reductions and climate targets. It is starting to emerge as one of the key moments in Australia’s transition to green energy.
Some expect one or two erasing units to remain operational until next summer if enough new renewable energy and storage capacity is not built. This was emphasized by Carney, the former Governor of the Bank of England and one of his most prominent advocates for a quick clean. energy conversion.
“Until we can build renewable energy and storage capacity and do it responsibly, we won’t shut down relentlessly,” Carney said in an interview on ABC TV’s 7.30 show. .
“But let me say two things. This is not an option where you have money you need to spend, the best place to spend your money is in the actual migration.”
And he later added:
“Let’s be clear: there is no way Australia will meet its climate goals if Ellering stays at the center of generations longer than necessary.”
While Mr Kearney’s focus is on pushing the transition forward, ensuring the lights stay on is up to the new NSW government, which is focused on keeping the lights on, and that it’s still possible. is a subtle but important difference between maintaining climate targets.
New energy minister Penny Sharp has repeatedly said that “all options”, including buyouts, are on the table since her appointment, with old conservative catchphrases like “when the wind doesn’t blow and the sun doesn’t”. I have relied on Explain the need to keep ‘shining’ online.
“The problem with Ellering here is that we need to keep the lights on in New South Wales,” Sharpe told reporters on Monday. “That’s my number one job and that of the Mins Labor Government/
“We have said all options are on the table as we make the transition, so we are not saying we will be closing in 2025.”
Sharpe’s comments came the same week NSW launched a major tender with “firm capacity” of over 380MW and storage of at least two hours.
The tender calls for demand management (where large energy consumers such as smelters reduce their consumption to free up supply elsewhere) to fill large gaps in such a way. It is unique in that it is the first of its kind in Japan.
The tender could be a race between demand management and battery storage given the timeline and focus on low or zero emissions technologies.
Sharp inherited the energy portfolio from Coalition’s Matt Keane. He is the mastermind behind the state’s renewable infrastructure program, which seeks a way to replace aging and unreliable coal generators within a decade, and has become something of a blueprint for the entire country. .
But while the NSW Labor Party ostensibly backs the roadmap, biannual auctions for wind, solar and storage capacity have already begun, with a focus on the potential downsides of the transition rather than the benefits. I’m putting
But Carney says the problem is that current market and policy designs are not aligned with the need to switch to clean electricity, and that renewable energy and storage are cheaper, more reliable and more affordable. It clearly provides a path to cleaner power, he said. current system.
“The current system doesn’t work. It’s not fit for purpose,” Carney said. “It’s not just climate issues, it’s energy security issues. And it’s affordable, so we need to move.” , implying that you emphasized this.
“I think the government recognizes….virtually without exception…this highlights the flaws in the system we have and we can fully accelerate the transition to a more sustainable and trustworthy system.” I did.”
Giles Parkinson is the founder and editor of Renew Economy, One Step Off The Grid, and the EV-focused The Driven. Giles has been a journalist for 40 years and is an Australian. He is the former business and associate editor of the Financial Review.