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Australia Delays Coal Plant Closure Due to Insufficient Renewable Energy

Australia is delaying the closure of its biggest coal plant because there is not enough wind and solar capacity to replace the baseload generator yet.

This is according to Bloomberg, which reported that Origin Energy had received a request from the New South Wells government, where the plant is located, to keep it in operation for longer than the utility initially planned. For that, Origin would receive financial assistance to the tune of about $150 million annually.

The Eraring power plant has a capacity of 2.9 gigawatts across four units. Origin Energy, the operator, had planned to retire it amid cost pressures from wind and solar installations that receive government support but the New South Wells government asked it to extend the life of the facility. Two of the four units will be kept in operation. When all four are in operation, they supply a quarter of the state's electricity consumption.

The call from the state government to Origin Energy comes amid a growing chorus of warnings about blackouts if Australian utilities continue to retire coal generation capacity at the current pace. The latest came earlier this week from the Australian Energy Market Operator, which also noted a growing population as a reason for the increased risk of blackouts.

The Eraring power plant was planned to be shuttered in 2025 but this has now been extended by two years on the apparent hopes that by then there will be enough wind and solar with battery backup to be able to secure the electricity needs of the New South Wales population.

Environmentalists were, unsurprisingly, unhappy about the New South Wales government's decision, saying it would compromise the state's transition plans.

Delaying the closure of Eraring not only jeopardizes our renewable energy goals but also undermines efforts to combat climate change and secure a sustainable energy future," the interim chief executive of an entity called Clean Energy Investor Group said, as quoted by ABC.

By Irina Slav for Oilprice.com

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Irina Slav

Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry. More

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