WA locks in renewables transition target with end-date for coal power stations

By Melissa Coade

June 16, 2022

Mark McGowan
West Australian premier Mark McGowan. (AAP Image/Richard Wainwright)

Mark McGowan has announced WA’s state-owned coal power stations will be retired by 2030. 

The premier issued a statement on Tuesday saying a closure date for the Muja and Collie power stations could be reached upon the ‘massive uptake’ of rooftop solar and renewables. 

He said that this trend was forcing a change in the energy system to ensure a secure electricity supply and guard against higher power bills. 

“Maintaining the status quo would see average yearly household power bills increase by over $1,200 within eight years,” McGowan said. 

“Alternatively, taxpayers would have to spend billions subsidising the system, taking funding away from key government projects and services.”

The closure of the Collie power station has been slated for late 2027. Muja D will close in late 2029. The government previously announced Muja C’s Unit 5 will close later this year and Unit 6 in 2024.

Without government intervention, McGowan explained, WA would experience major electricity price hikes over the next decade. Energy rate projections under the current settings would see household costs rise from about $1,800 to more than $3,000 a year. 

The government will provide the Collie power station with a new half-a-billion dollar package, totalling $662 million for the station to date. A total of $200 million will go towards a training fund for workers and create industrial opportunities for local blue-collar jobs.

A further $3.8 billion would be spent on what the government claims will be one of its biggest infrastructure projects since METRONET, to generate thousands of new jobs in renewable generation and storage. 

As part of the plan for a ‘sensible and managed’ transition, McGowan noted, electricity reliability was a priority. The premier also added the government would continue to cap prices at inflation.

“The transition will be implemented in a sensible, consultative manner, with long lead times to ensure workers and the wider community can plan for the future.

“These initiatives will create new local industrial and blue-collar jobs to make sure the local workforce has the opportunity to transition into new, high-quality roles in the Collie area,” he said. 

The Australian Energy Market Operator (AMEO) welcomed this week’s news and said WA’s announcement would allow ​​new investments to proceed with confidence.

AMEO’s Kate Ryan said the operator would work with the government and other stakeholders to ensure a reliable transition was achieved.

“We will continue to work closely with the WA government, ​​Synergy, and industry to ensure that as existing coal-fired generation is retired, new renewable generation and storage, including the announced wind generation and battery storage investments, are securely and reliably integrated into the South West Interconnected System (SWIS),” Ryan said. 

Synergy and Water Corporation is considering its storage needs with a feasibility study underway for a pumped hydro project. 

The company is also looking into how feasible it will be to use hydrogen power with its existing gas generation assets.

Energy minister Bill Johnston said the government was investing in the future of the state’s electricity system, which would also reduce the carbon emissions of Synergy. By phasing out coal-fired power, the company’s carbon footprint is expected to drop by 80% by 2030. 

“We will be working closely with impacted businesses, workers and communities to ensure we create new jobs and training opportunities to future proof Collie for the coming decades,” Johnston said. 

The government also expects the South West Interconnected System will reduce its carbon emissions by 40% compared to 2020-21 levels because of additional industry demand for renewable energy. 

No new natural gas-fired power stations will be commissioned by the government on the SWIS after 2030.

“The government remains strongly committed to its domestic gas-reservation policy, which reserves 15% of natural gas — that would otherwise be exported — for the WA market,” the statement said. 


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