The Latrobe Valley’s brown coal generators are expected to close in 10 years to make way for the rapid uptake in renewables, according to a market operator modelled forecast released recently.
Australian Energy Market Operator modelling predicts “all brown coal generation and over two-thirds of black coal generation could withdraw by 2032”.
The draft Integrated System Plan 2022 outlines four scenarios to 2050, with the most probable path anticipating a nine-fold increase in large-scale renewables such as wind and solar.
It also forecasts a near doubling the demand for electricity as transport, heating, cooking and industrial processes are decarbonised.
“Current announcements by thermal plant owners suggest that about five gigawatts of the current 23 gigawatts of coal capacity will withdraw by 2030,” the report states.
However, modelling suggests that 14 gigawatts of coal generation could withdraw from the market by 2030 and be completely exited by 2043.
“Over the past decade, coal-fired generators have withdrawn from the market before their announced dates, and competitive and operational pressures will intensify with the ever-increasing penetration of cheap renewable generation,” AEMO said.

Yallourn Power Station.

AEMO chief executive officer Daniel Westerman said the significant changes already underway in the National Electricity Market have continued to accelerate.
Mr Westerman said this rapid transformation would consist of a significant investment in renewables, storage and firming generation as coal plants exit, and improvements to transmission.
“This transformation will efficiently deliver secure, reliable and affordable electricity while substantially contributing to national emissions objectives,” Mr Westerman said.
Loy Yang A and B are officially scheduled to close around 2048, with Yallourn to shut in 2028.
Alinta had stated Loy Yang B will close in 2047, “or earlier recognising that the retirement of the plant is unlikely to be a unilateral decision by the owners”.
Its decision would be “heavily influenced” by key stakeholders and the requirements of the NEM.
“Loy Yang B supports the energy transition by providing system strength alongside firm supply,” the company said.
“And this reliable supply will remain critical until the transitioning electricity system we see today becomes mature enough to provide the stability the NEM requires to operate securely.”
An AGL spokeswoman said there was “no doubt that coal fired generation will exit the system earlier than previously believed, enabling a faster decarbonisation pathway”.
But she said coal closures must not happen outside of a co-ordinated plan across governments, industry, regulators and the community.
“Without this we create market uncertainty that risks projects being online at the right time and in turn impacting reliability and most critically for customers – affordability,” she said.