AGL has announced it is bringing forward the closure of the Bayswater and Loy Yang A Power Stations in NSW and Victoria.
These power stations have been critical providers of reliable generation and regional jobs for decades.
While this announcement is providing around eight to eleven years notice for Bayswater, and more for Loy Yang A, I strongly encourage AGL to commence engagement with workers and local communities now to put plans in place for the future.
The early closure of these two generators, 2030-33 from 2035 for Bayswater and 2040-2045 from 2048 for Loy Yang A, will leave a considerable gap of close to 5000 MW of reliable generation in the National Electricity Market.
While this announcement is a commercial decision and AGL has complied with the minimum 3.5-year notice period, the exit of such a considerable amount of reliable generation is a concern for the continued reliability and affordability of the system.
Delivery of new, timely, replacement dispatchable capacity will be critical in keeping prices low and the lights on.
We have seen what happens when this does not occur, with prices skyrocketing by 85 per cent following the premature closure of the Hazelwood Power Station in 2017.
Energy is an essential service, and the Morrison Government expects the market to step up to keep the lights on and prices low.
AGL's long-term plans for developing the sites of these generators as industrial energy hubs, and their plans for investment in new dispatchable capacity are welcome.
As we saw with the announced closure of Liddell, proposals for new projects are not enough. It is critical that private sector announcements translate to actual investments.
Through our investment in Snowy Hydro's Hunter Power Project gas generator, the Morrison Government is taking action to step up when the private sector did not to keep electricity affordable and reliable for Australians.
This complements our actions to deliver the 2000 MW Snowy 2.0 pumped hydro project, and our support of every major priority transmission project to deliver generation when and where it is needed.
The Government will closely monitor and model the impact of these closures, to hold industry to account on the dispatchable capacity needed to ensure affordable, reliable power for consumers.
