1 March, 2017
Chip Le Grand
Courtesy of the Australian
One out of every 10 residents would flee the Latrobe Valley if the Yallourn power station follows Hazelwood and shuts its doors early due to the impact of the RET, increased coal royalties and other government policies squeezing the viability of coal-fired power, economic modelling commissioned by local business and community leaders has found.
The population exodus would be accompanied by the loss of 3100 direct and indirect jobs and represent a $1.7 billion hit to a regional economy already struggling with high unemployment, high youth unemployment and long-term decline, the report for the Committee for Gippsland warns.
The Yallourn W station’s operating licence is due for renewal in 2026 and the life of its brown-coal mine expires in 2032, one year before the Hazelwood plant was scheduled to close. Sources close to the plant say there is a growing expectation Yallourn will instead close in the next five years.
The uncertainty surrounding Yallourn, a 1970s station which generates more than 20 per cent of Victoria’s power and supplies 8 per cent of the National Energy Market, has prompted the Victorian opposition to elevate the future of the plant to a frontline political issue. Opposition Leader Matthew Guy vowed to keep Yallourn open.
“When Daniel Andrews talks about a 40 per cent Renewable Energy Target, it’s code for him wanting to shut down the Yallourn power station,’’ Mr Guy told The Australian. “If Yallourn shuts it will hurt Victorian families and businesses with job losses and huge hikes in electricity costs. A Liberal-National government will keep the lights on by backing our coal-fired power industry.”
Mr Guy met Gippsland community leaders this week in the Latrobe Valley town of Moe. He has vowed to scrap Victoria’s state-based RET if elected in 2018.
Although Yallourn will benefit from the closure of Hazelwood, which supplies about 22 per cent of Victoria’s coal-fired energy baseload, it has been slugged by a tripling of the state government coal royalty from the start of this year, a more than doubling of money it must keep in a “rehabilitation bond’’ and an artificially low electricity price created by the market distortions of the RET.
A spokesman for EnergyAustralia, the owner of Yallourn, said although the company planned to keep the plant open as long as it had coal reserves to mine, it had to respond to “policy signals’’. ‘‘We absolutely support the transition to cleaner forms of energy,’’ the spokesman said. “That means we must as a nation replace coal-fired generation with lower-emissions generation but do so in a way that provides the market structures to drive affordable energy and preserves the reliability that generators like Yallourn provide today.’’
The Committee for Gippsland commissioned the modelling prior to last year’s announcement by Engie, Hazelwood’s multinational owners, that it would close the plant next month. The modelling was done on the scenario of two of the Latrobe Valley’s four coal-fired plants closing.
The population of the city of Latrobe is 74,001. The closure of Hazelwood and Yallourn would result in the loss of 1400 direct jobs, 1771 indirect jobs and strip $42 million in wages from the region. Some 7167 people would leave.