Hazelwood To Close (kind of?)

When a state government facing an uncertain chance at the polls, they are liable to make announcements that are not fully thought through.  Today is one of those days.

Today the Victorian Government announced that they are closing down Hazelwood Power Station.  I for one welcome the announcement, however there is a big catch.  The government don’t actually own the power station!  International Power own Hazelwood.  So that means some sort of deal with the owner that has yet to be brokered, so an announcement that the power station will incrementally close down generators is a little premature.  Here is an extract from The Age to put it into context;

Victoria has been forced to go it alone after the federal government ruled out setting a price on carbon until after 2012 in a move the premier said threatened investment in green energy.

“We’ve got new investment which has been deferred indefinitely until there is certainty in relation to Hazelwood,” Mr Brumby said.

“I’ve made our position very clear today and that is that if you want to tackle greenhouse (emissions), if you want to tackle climate change – you can’t do that without tackling the worst of the coal generators, which is Hazelwood.”

Hazelwood produces about a quarter of Victoria’s energy.

Shutting down two power units would save up to four million tonnes of emissions annually over the next four years. This equates to about 28 million tonnes by 2020.

The government has set a 2020 emissions target of 20 per cent of 2000 levels, or about 30 million tonnes.

All fantastic news, especially the emissions target which will be a first for Australia, however there is no articulated plan on how to cut the emissions except the closing Hazelwood piece.  But here is the rub;

International Power spokesman Jim Kouts stressed that while there was a preliminary discussion about closing Hazelwood “there is certainly no agreement”.
Shutting down Hazelwood “would require governments to support the phased closure of all generating units over an agreed term in return for a fixed capacity payment,” he said.

So no deal struck, just talk, and no plan on what to replace it with renewable energy (that I have seen).

Gee, that reminds me of another post I wrote recently about climate change policy!  I will rejoice if it comes to fruition, but I still hold my breath.

More info about this plan when it comes to hand.  I will have to read the 30 page white paper and get back to you all.



  1. says

    @ Darren,

    They certainly don’t play their cards close to their chest! You are right of course, International Power can now name their own terms as far as a price goes.

    There are better things they could do, but I do believe that the only way we are going to make a difference to carbon emissions reduction, it will be via the big bang approach. What concerns me most is their plan after Hazelwood.

    @ Lorraine,

    Yes, the people are important too. I never said that anyone should loose their jobs over the closure. Re-skilling and working on renewable energy projects could be an alternative. The transmission lines are in place, so just add turbines or solar thermal. I have even read that geothermal is a possibility in the region.

    I bet the saddle makers in the early 20th Century said the same thing at the advent of the motor car.

  2. lorraine says

    what about the people who work there though or are we just thrown on the scrap heap,yes hazelwood is a mess but why should the whole valley suffer

  3. says

    It’ll be interesting to see how much the government pays to close Hazelwood. It they’re already making the promise to voters, then International Power will pretty much be able to name their price, won’t they?

    And really, they’re not going to be paying to “close Hazelwood” – they’re paying to “close Hazelwood earlier than it otherwise would have”.

    In some ways, it’d be better to wait for the ETS or carbon tax to deal with Hazelwood, and spend all that money on other things like increasing renewable generation capacity, harvesting rainwater, etc.

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