AGL strikes deal with Victoria to keep Loy Yang running until 2035

afr.com:

AGL Energy has struck a deal with the Victorian government to keep the Loy Yang A coal-fired power station running until 2035, despite pressure from its biggest shareholder, software billionaire Mike Cannon-Brookes, to shut the huge generator earlier and align with the Paris climate accord.

The agreement is the second to be reached by the state government that puts more certainty around the timing of closures of large coal-fired plants, which still provide most of Victoria’s power.

Coal power generators such as Loy Yang still provide the bulk of Victoria’s power. 

Victorian energy minister Lily D’Ambrosio said the binding deal provides 12 years notice of the closure, helping avoid a situation where uncertainty over future generation levels could deter new renewable energy from entering the market and drive power price increases for customers.

The news came as EnergyAustralia said it would shift its big coal-fired generator in NSW into a back-up role and cease running it as a baseload plant well ahead of its 2040 closure date, as it adjusts its operations to meet climate goals.

The change is included in a $5 billion-plus climate action plan announced by EnergyAustralia which is intended to put in on course for net zero Scope 1 and 2 emissions by 2050, with a pathway to be announced for Scope 3 emissions by the end of next year.

EnergyAustralia’s 1400-megawatt Mt Piper generator near Lithgow would move to a “firming” role for renewable energy, and then eventually to a “reserve” role before its shutdown, the country’s third-biggest electricity and gas retailer said on Monday.

The supplier, owned by Hong Kong-listed CLP Group, also confirmed the closure of its 1480MW Yallourn coal-fired power generator in Victoria in