Energy Opinion Piece - The West Australian

Back in February this year I took on the role of Shadow Energy Minister and the first thing I did was to alert the Western Australian community that the State Labor Government’s energy transition plan doesn’t add up and won’t work.

This was to highlight the fact that the current plan to transition to renewable energy is underfunded and impossible to deliver on the current timeframes.

Closing down all the state owned coal power stations by 2029 will not be possible without providing a genuine alternative supply that is reliable and can keep the lights on, and right now the State does not have a plan to provide adequate electricity generation, storage or transmission infrastructure.

When the Government announced its plan back in June 2022 it also announced a $3.8 billion budget for it, which is probably $11 billion short of the true cost.

That $3.8 billion was carefully outlined in estimates as $3 billion for Synergy to build 410 megawatts of wind generation and 4,400 megawatt hours of batteries, and $800 million for WaterCorp to build wind farms to power the next desalination plant.

But by the May budget this year the total spend had gone down to $3 billion, not up as needed.

The Government has also been inundated with official reports telling them that their plan is in trouble.

At the end of last year the Australian Energy Market Operator (AEMO) put out report telling the Government that despite belief in their own policy perfection Western Australia may run out of domestic gas in coming years.

That panicked the Government into instigating a parliamentary committee to have a look at the problem.

And last week a second AEMO report said the state might also run out of electricity.   

That AEMO statement of market opportunities forecasts “a need for additional capacity from the start of the outlook period in 2023-24, rising to 945 MW in 2025-26, and to around 4,000 MW by 2032-33”.

So, the market operator now acknowledges that the state may need an additional 4,000 megawatts at a time the Government is closing down 932MW from state run coal generators and expects to lose another 434MW from the privately owned coal generator in Collie.

The latest review of our state’s electricity supply should be ringing alarm bells for the Government, with a significant shortfall of generation, storage and distribution all noted in the report.

While the report suggests a range of developments in those shortfalls may eventually arrive, this is not a proper plan to transition our energy system, and the Government is still hoping the private sector will ride to its rescue and deliver them.

On the same day AEMO issued its second warning bell, the Government made an extraordinary admission of failure.

It announced that the planned closure of the Muja 6 coal generation unit in Collie would be delayed until April 2025.

The cynics among us might note that this is one month after the next state election, representing a desperate attempt to keep the lights on in the lead up to the March 2025 poll despite its self-inflicted policy failure.

All this is on top of the Government importing 103,000 tonnes of coal from NSW at the start of this year in yet another act of desperation to keep the lights on in January and February 2023.

Then Premier Mark McGowan’s demand of the Energy Minister that he keep the power on at any cost actually cost the state hundreds of millions of wasted dollars as a cool summer meant it wasn’t needed.

And the imported coal has different characteristics, so blending has become a problem and eight months later Synergy has struggled to use 71,000 tonnes of the 103,000 tonnes it imported.

In summary the Labor State Government has a massive underinvestment in generation, storage and distribution as a part of a transition plan that cannot be delivered on the current timeframes, and it is prepared to take unnecessary coal to Collie at a cost of hundreds of millions of dollars to hide its’ failures.

Wow, no wonder it is considering calling an energy summit; someone has to clean up this mess.

I want to a transition to renewables, but I want to see it done in a way that keeps the lights on and the air conditioners running as we deliver that transition.

And I want to see it done at a cost that people can afford.

The current underfunded plan will leave a hole that consumers will have to pick up, so we are looking at massive price rises in the future on the current Labor model.

And as Labor admitted last week, they will need to keep coal going longer, or build more gas fired capacity, or a bit of both.

Which is exactly what I said six months ago.