Latrobe Valley power station owners have agreed to give five year’s notice of their intention to close as part of a deal with the state government to extend their mining licences.
State Resources Minister Tim Pallas today announced the deal, which will extend Energy Australia’s licence for the Yallourn mine to 2051 and AGL’s licence for the Loy Yang mine to 2065.
The extension does not allow for coal mining beyond the plant owners’ nominated closure dates of 2032 (Yallourn) and 2048 (Loy Yang) but will allow extra time for mine rehabilitation.
Today’s announcement means there will be no repeat of the Hazelwood closure where the community was given just six months to prepare.
Mr Pallas said the extensions would “support our energy security and provide certainty for workers and communities across Victoria”.
“The five-year notice period is longer than what the Commonwealth has sought through the Finkel Review and gives local workers and their families confidence to plan for the future,” he said.
The extensions also create the likelihood of ongoing mine rehabilitation work in the region beyond the middle of the century.
The announcement follows the appointment in July last year of professor Rae Mackay as the Latrobe Valley Mine Rehabilitation Commissioner, a key recommendation of the Hazelwood Mine Fire Inquiry.
Professor Mackay was appointed to audit rehabilitation of the region’s mines, consult with the community and provide independent advice to the state government about rehabilitation and help it develop the Latrobe Valley Regional Rehabilitation Strategy.
He said “having adequate timeframes for mine rehabilitation, a minimum of 17 years for Loy Yang and Yallourn, will help planning and consultation with the local community regarding the future of these sites”.
EnergyAustralia executive – energy Mark Collette said the decision would allow certainty for the company’s employees and the local community.
“While Australia is making the transition to a modern, cleaner energy system the plant still has a role to play providing stability as more wind and solar power is integrated into the grid,” Mr Collette said.
“We recognise that Yallourn will retire at some point in the future and we plan on giving our customers and our community five years’ notice – enough time to absorb this change as smoothly as possible.”
He said the company’s immediate plan was to continue to invest in the plant “for so long as the plant was needed”.
AGL Loy Yang general manager Steve Rieniets welcomed the announcement.
“Although we are progressively rehabilitating we estimate we would need a further 15 years after coal operations cease to conduct final rehabilitation,” Mr Rieniets said.
“We believe the five year notification period is important. Giving as much notice as possible ahead of plant closure enables replacement investment to occur and avoids the dramatic market impacts observed following the closure of the Hazelwood plant, with five months of notice.”
Energy Australia executive – energy Mark Collette said the announcement provided certainty for workers and the community.
“While Australia is making the transition to a modern, cleaner energy system the plant still has a role to play providing stability as more wind and solar power is integrated into the grid,” Mr Collette said.
“We recognise that Yallourn will retire at some point in the future and we plan on giving our customers and our community five years’ notice – enough time to absorb this change as smoothly as possible.”
State Energy Minister Lily D’Ambrosio said a clear timeline for the end of brown coal generation in Victoria was “essential in achieving our renewable energy targets of 40 per cent by 2025 and net-zero emissions by 2050”.
