NSW’s Fresh Start: A New Era for Energy, Or More Of The Same?

Chris Minns - NSW Labor

With NSW Labor led by Chris Minns seizing power in New South Wales, what lays ahead for renewable energy, emissions reduction and electricity bills?

NSW Labor went into the election with its “Fresh Start Plan”. On energy, emissions and renewables, it primarily consists of:

NSW Energy Security Corporation

The incoming Minns Labor Government has committed to creating the NSW Energy Security Corporation. This is to be a state-owned body with a mission to accelerate investment in renewable energy assets.

Seeded with a $1 billion investment from the existing Restart NSW Fund, the NSW Energy Security Corporation will partner with industry on projects including medium to long duration renewable storage solutions such as pumped hydro, and community batteries to maximise benefits of rooftop solar.

Enshrining Emissions Targets Into Law

Currently, NSW has aspirational emissions reduction targets. NSW Labor introduced a private members bill back in 2021 to legislate these targets, but this was unsuccessful.

Labor has committed to legislating targets including net zero by 2050 and an interim 50% reduction on 2005 carbon emissions levels by 2030.

Net Zero Commission

The Minns Government will establish the “Net Zero Commission”, which will be charged with the task of developing the net zero plan and monitoring its progress; including impacts on employment and energy prices.

Power Bill Sugar Hit (For Some)

And on the issue of energy prices and short-term relief, households receiving income support, pensioners, Seniors Health Card holders and Family Tax Benefit recipients will receive a $250 rebate in several instalments over a year. However, under a re-elected Liberal and Nationals Government, every household in NSW would have been eligible under a scheme similar to that in Victoria.

Who Will Be The New NSW Minister For Energy?

That is yet to be confirmed. Jihad Dib has been the Shadow Minister for Energy and Climate Change, and it’s widely expected he will take over the Energy portfolio from outgoing Energy Minister, Matt Kean.

Keening For Kean

Matt Kean wasn’t the Messiah, nor was he a very naughty boy. But he was a true believer in renewables. RenewEconomy’s Giles Parkinson has opined the loss of Matt Kean as the state’s minister for energy “is a potential disaster for Australia’s energy transition, although it does not need to be.”

Some had hoped Mr. Kean would take a crack at the NSW Liberal leadership given Dominic Perrottet is stepping down. But Mr. Kean said yesterday he had decided to not throw his hat in the ring as he wishes to spend more time with his family. And good luck to him.

Filthy Elephants In The Room

While there’s hope and indications a Minns Government will build on the Perrottet Government’s renewables legacy, the fossil fuel minefield remains.

One of the issues is the future of the coal-fired Eraring Power Station  – the state’s largest power station and an emissions-spewing monster. In February last year, Origin Energy announced its intentions to close down Eraring Power Station in August 2025, 7 years early. But early this month Mr. Minns created a stir when he said he would consider buying back Eraring, and potentially keep it running past 2025.

Another particularly thorny issue is the Narrabri gasfield project. The Australian Petroleum Production & Exploration Association (APPEA) is already calling on the incoming government to enable investment in new supply, and specifically mentioned the controversial project.

About Michael Bloch

Michael caught the solar power bug after purchasing components to cobble together a small off-grid PV system in 2008. He's been reporting on Australian and international solar energy news ever since.

Comments

  1. Geoff Miell says

    Never mind the announced earlier closure of Eraring Power Station (4x 720 MW) due in Aug 2025. What seems to me to be more pressing is whether there’s enough generating + energy storage capacity in NSW + adequate imports from other states to meet demand beyond the impending full closure of Liddell Power Station:

    Unit 3 has already ceased generating, on 1 Apr 2022;
    Unit 4 is scheduled to close on Wednesday, 19 Apr 2023 (23 days to go);
    Unit 2 is scheduled to close on Tuesday, 25 Apr 2023 (29 days to go);
    Unit 1 is scheduled to close on Saturday, 29 Apr 2023 (33 days to go).
    https://wattclarity.com.au/articles/2023/02/20feb-closure-expectations-liddell-and-eraring/

    AGL first announced its intention to close Liddell Power Station in Apr 2015 – that’s 8 years notice.
    https://www.agl.com.au/about-agl/media-centre/asx-and-media-releases/2017/september/agl-energy-statement-on-liddell-power-station

    Matt seeks to answer the question: Can NSW replace Liddell?
    Part 1: http://crudeoilpeak.info/can-nsw-replace-liddell-part-1
    Part 2: http://crudeoilpeak.info/lack-of-reserve-on-hot-day-in-nsw-as-liddell-power-plant-is-scheduled-to-close
    Part 3: http://crudeoilpeak.info/nsw-power-supply-on-16-march-2023-so-tight-that-aemo-had-to-issue-emergency-response-directions

    Has the outgoing NSW Coalition Government done enough to avoid the lights in NSW going out? We’ll see soon!

    • George Kaplan says

      In 2017 the planned 2022 closure of Liddell meant there would be a 1000MW gap in base load, dispatchable power generation. In 2018 Lidell was deemed a 1,680 MW power station – down from its original 1973 2,000 MW of coal fired steam turbines.

      The closure of 1 turbine shouldn’t have affected base load power. The closure of the remaining 3 next month could. Since 2017 there has apparently been over 800 MW of solar farm\solar plants been constructed, but of course these don’t operate 24 hours a day, and even at peak don’t cover the base load being lost. There has also been over 1,500 MW of wind farms been built. While not restricted to daylight hours like solar, they too are unreliable.

      Can 2,300+ MW of solar and wind power (not counting rooftop solar) provide the same base load, dispatchable power generation as a 1,680 MW coal power station? We’ll soon know! And if they can’t, the closure of Eraring will prove devastating to NSW. Should Labor permit it anyway, residents better start stocking up on candles and campfire fuel!

      • Geoff Miell says

        George Kaplan,
        While not restricted to daylight hours like solar, they too are unreliable.

        How so, George? Wind turbines are:

        1. Very reliable machines – availability 95-97% of the time – “require fewer than 20 days a year for regular servicing and maintenance, which can often be scheduled for less windy periods.

        2. Predictable generation volumes.

        3. Price stability and inflation linkage lead to predictable revenue.

        4. Certainty of operational costs leads to predictable income.
        https://www.schroders.com/en-us/us/intermediary/insights/how-wind-farms-can-power-pension-returns/

        Unlike coal-fired power stations, where unavailability has hit 24% across calendar 2022, for 44x coal units (i.e. excluding the soon-to-be-fully-closed Liddell) in the NEM.
        https://wattclarity.com.au/articles/2023/03/06march-geninsights-q4-coal-units/

        AEMO says the price spikes in the coal dependent states were largely because of widespread outages at ageing and increasingly unreliable coal plants, and significantly higher prices demanded by black coal generators, who shifted most of their output to prices well above $100/MWh.

        https://reneweconomy.com.au/coal-states-miss-out-on-benefits-of-cheap-wind-and-solar-pay-twice-the-price-of-power/

        And if they can’t, the closure of Eraring will prove devastating to NSW. Should Labor permit it anyway, residents better start stocking up on candles and campfire fuel!

        I’d suggest the decisions/actions made during the three terms of the NSW Coalition Government (26 Mar 2011 through to 25 Mar 2023 – 11 years, 11 months, 3 weeks, 6 days) have contributed to NSW’s current precarious electricity supply predicament.

  2. George Kaplan says

    Given the alarm bells are ringing for NSW, will the new government have any choice about keeping coal stations etc running if they want reliable power rather than rolling blackouts?

    Eraring provides what, about a fifth of the state’s total capacity with coal providing between two-thirds and three-quarters of the state’s power over the course of a year? The state is already struggling and if electricity use rises through increased EV uptake, rising population, conversion of gas to electricity etc, that struggle will only exacerbate. Switch off power stations and the lights will simply go out.

    Does a Minns Government have a plan, other than blaming previous governments? (Which is pretty much a universal strategy in all democratic nations)

  3. Des Scahill says

    I can’t find any recent data, but it seems to me that the large numbers of small businesses closing shop, along with likely some hundreds of thousands of households in financial difficulty, could mean that demand will be less than expected.

    Any increase in rooftop solar PV uptake helps the situation too.

    There may well be some power outages, but perhaps those could be a bit less severe and for shorter periods than anticipated.

    This report from St Vinnies gives some clues of the financial impacts upon low-income households during various time periods up until 2019.

    See: https://www.vinnies.org.au/page/Our_Impact/Incomes_Support_Cost_of_Living/Disconnections/

    Here in QLD even homes and businesses with solar PV are reducing consumption where they can. Their net bills are increasing due to lower FIT’s and increased fixed charges. The days of credit balance refunds seem long gone.

    Hard to know how it will all pan out. The other surrounding financial pressures of various kinds on households and businesses are quite severe for many, including middle-income households, even those with dual incomes in some instances.

    All of the above points to demand being less than expected, and certainly far less than that predicted by the advocates of nuclear power stations.

  4. There’s a huge opportunity for the new Government to step up and regulate against inverters with potential security risks.

  5. This could be a new wave of solar in NSW. How will Minns respond to the Huawei Crisis.

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