By Cole Latimer
AGL will build a $400 million gas-fired power plant near Newcastle, NSW as part of the first stage of its planned shutdown and replacement of the Liddell coal-fired power station.
The energy company has announced it will build the 252-megawatt gas-fired plant near its Newcastle Gas Storage Facility, completing construction at the end of 2022. The new plant will consist of fourteen 18-megawatt gas engines.
An artist's impression of a similar station in South Australia
“AGL is committed to supporting the orderly transition of Australia’s electricity generation capability to a modern, clean and reliable energy supply,” AGL chief executive Andy Vesey said.
“That’s why we gave seven years’ notice of when we intended to close the Liddell Power Station at the end of 2022 and we are pleased to commit today to build the power station near Newcastle.”
Thursday’s announcement puts its three-stage planned replacement of the Liddell coal-fired power station ahead of schedule, following the start of its $200 million, 100-megawatt upgrade of the Liddell-adjacent Bayswater coal-fired power plant in February.
However, AGL is yet to commit to the second and third stage of replacing the 850 megawatts of generation that will be lost if Liddell closes down.
“We continue to assess the potential to develop a further 500 megawatts of gas-fired generation capacity as part of Stage 2 of the plan,” Mr Vesey said.
It comes as the Australian Energy Market Operator questions AGL’s commitment to the continued replacement of energy, stating that by not doing so it could harm consumers and drive up electricity prices.
The federal government has also continued to encourage AGL to keep Liddell open beyond 2022 in order to secure ongoing electricity in the face of a forecast shortfall in power, prompting rival energy company Alinta to make a bid for the power station to keep it open until 2029.