Eraring extension unnecessary: Government has cheaper, cleaner options

The Public Interest Advocacy Centre (PIAC) has called on the NSW Government to adopt a program of reliable, sustainable energy solutions rather than extend the life of the Eraring coal-fired power station.  

There is growing speculation Eraring will be subsidised to operate beyond its planned 2025 closing date due to perceived risks to reliability of NSW energy supply. PIAC says there are cheaper, cleaner, future-proof actions the NSW Government can take to ensure a smooth transition for NSW through imminent coal power station closures. 

Comments attributable to Craig Memery, PIAC Senior Energy Advisor:  

‘Propping up old coal generators is a no way to run an energy transition. There are cheaper, cleaner, future-proof alternatives that build on actions NSW is already taking: supercharging energy efficiency, doubling down on demand response, and fast-tracking battery energy storage.’ 

‘Every unit of energy saved through energy efficiency and demand response means 1.1 units of energy that don’t need to be produced by power stations such as Eraring.’ 

‘Money spent operating Eraring is money up in smoke. Investing in batteries instead will support cheaper, reliable energy for decades.’ 

‘Interfering with the competitive energy market to extend the operating life of Eraring would cost NSW taxpayers and energy users hundreds of millions of dollars and undermine investor confidence in the new energy generation and storage infrastructure needed to modernise the energy system.’ 

‘With a tight NSW budget, we should focus on measures that support the energy system transition, maintain a reliable system, and reduce energy costs for people struggling with the cost of living.’    

Craig Memery sits on a number of statutory energy bodies, including the Reliability Panel which is responsible for monitoring the security and reliability of the energy system. Comments here are made in his capacity as PIAC’s Senior Energy Advisor.      

Background: PIAC’s proposed solutions 

There are effective measures that can maintain energy supply reliability without a reliance on coal generation.  

Energy efficiency works around the clock to reduce demand and emissions now and into the future. NSW could tap into energy efficiency opportunities in the next two years by  

  • supercharging existing NSW energy efficiency programs for households and small businesses, including low income, social housing and inefficient rental homes, and 
  • entering into direct contracts with commercial and industrial energy users to support high impact efficiency improvements. 

Demand response supports a stable energy system by rewarding some energy users for voluntarily reducing their demand when the supply-demand balance is tight. This helps reduce energy prices for everyone while keeping the lights on. NSW has hundreds of Megawatts of potential demand response that could be unlocked by: 

  • supporting commercial and industrial energy users to participate in AEMO’s Wholesale Demand Response Mechanism and Reliability and Emergency Reserve Trader schemes, 
  • promoting expedited expansion of AEMO’s Wholesale Demand Response Mechanism to allow households to participate via demand aggregators, and 
  • expanding eligibility and increasing support for the existing NSW Peak Demand Reduction Scheme and bringing forward the scheme’s 10% reduction target from 2030 to 2027. 

Battery energy storage systems balance supply and demand in the energy system by storing cheap abundant renewable energy to use when needed. Batteries are an essential tool in the transition from fossil-fuel to renewable energy. NSW could further accelerate the rollout of battery energy storage by: 

  • implementing targeted measures to support accessibility and affordability of behind-the-meter batteries for small and large energy users, and 
  • using the existing NSW Energy Infrastructure Roadmap and Commonwealth capacity mechanism arrangements to fast-track new grid-scale batteries. 

Media contact:  
PIAC Media and Communications Manager, Dan Buhagiar: 0478 739 280  

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