Alinta eyes bid for Eraring as NSW transition falters

afr.com:

Alinta Energy is eyeing a bid for Origin Energy’s Eraring coal power generator in a move that could cement in place the extended operation of the plant beyond its targeted closure date of August 2025.

The electricity generator and retailer, which owns one of Victoria’s three large coal power stations, is thought to see value in running the 2880-megawatt generator in NSW beyond that date in the belief that the transition to low-carbon energy will take longer than expected.

Origin’s Eraring coal power plant has caught the eye of Alinta Energy. Brendon Thorne

The NSW government is expected to outline its strategy for Eraring, the country’s largest power station, after being advised by an independent consultant that the generator is needed for longer to ensure security of supply in the state as replacement supply projects run late.

The Electricity Supply and Reliability Check Up review found NSW might need to rely on traditional power sources, including coal and gas, to avoid electricity shortfalls as the state transitions to renewables.

However, it is expected some in the government will oppose a sale to Alinta, owned by Hong Kong-listed Chow Tai Fook Enterprises, and to prefer to negotiate with Origin if the generator needs to run for longer.

Alinta declined to comment.

The government has yet to start any substantive negotiations with Origin about extending the life of Eraring.

However, the supplier has form in eyeing coal power stations slated for closure, having unsuccessfully bid for AGL Energy’s Liddell generator in NSW in 2018 amid a political storm over closure plan for the then 46-year-old plant. AGL rebuffed the then Turnbull government, which was urging it to sell the plant, rejecting Alinta’s $250 million offer.