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Reality bites: Callide drama exposes a Government whistling in the dark

Opinion

The State Government has been grimly hanging on to its coal-fired power station fleet in the hope nothing disastrous would happen. Well, guess what?

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Had yesterday’s Callide power station event happened in summer our generator companies would be a lot more anxious than they are now. Even so, experts are saying the affected Callide unit could be out for a year.

If that’s the case, and we really don’t know for sure, summer could be troubling. Not only that, Callide now raises questions about what comes next.

As QUT’s Acting Head of School in the School of Electrical Engineering and Robotics Geoff Walker points out, the Government-owned CS Energy has to figure out whether the damage to Callide leaves it unsustainable.

If it isn’t they may have to shut that unit and look for alternatives. That is an issue with a lot of dollars attached to it. Not only that, there will be losses for the year or so that it’s out of action.

That is unlikely to mean coal. Say what you like about the Palaszczuk Government and its clumsiness in handling energy policy but it is miles ahead of its federal counterparts on this question.

What it should mean, but probably won’t, is that the Government grabs the initiative and develops an energy policy that reflects reality rather than wishful thinking.

For that, I hope they have a chat with CleanCo’s Maia Schweizer who yesterday painted a picture of dramatic change in the industry.

Here’s the overview of what has happened. In normal times, Queensland has plenty of energy capacity. Yesterday’s drama was made more worrying because 1000 Mw was offline for maintenance, which is normal at this time of the year.

Then, when Callide went down, it took other power stations with it. Three of Stanwell’s units went offline, as they are designed to do in a major event.

That’s why 400,000 homes lost power and traffic lights in Brisbane went out.

But Queensland is not South Australia. We coped because a lot of things went right when a lot of other things went wrong, but that won’t always be the case.

The state has been able to deal with spiking demand in summer heatwaves, but in some cases when generators trip or are offline the difference between coping and not coping has been slim and we should all be thankful for the abundance of rooftop solar.

The Grattan Institute’s Tony Wood said that Queensland can import energy from NSW so the loss of Callide and its 400 Mw is manageable.

“Obviously, that looks harder when something else goes wrong,’’ Wood said.

Throw into the mix that coal-fired power has lost the economic argument and is likely to be all but redundant by 2030.

So what will replace it or will the coal units just continue to run at a loss? At the moment the Queensland policy is for renewables to make up 50 per cent of energy by 2030 and there are a few doubts it will reach that. So then what?

It was only a month ago that Stanwell chief executive Richard Van Breda resigned after he said Queensland should transition away from coal and shut down some of the fleet earlier than current timelines.

Was he right?

Of course he was and the State Government knows that despite its protests. It just got the jitters when the Electrical Trades Union got wind of what Van Breda said and realised what that meant for its members.

The reality is that most of Australia’s coal fleet will close in the next 15 years, some estimates have said that about 70 per cent of Australia’s coal-fired generators had about a decade of life left.

Callide B, which is more than 30 years old, is scheduled to close in 2028, 10 years earlier than originally forecast. Callide C, which is the generator where yesterday’s event occurred is 10 years younger. It has probably 20 years of technical life ahead of it.

So where does that leave Queensland when coal will be redundant in a decade and renewables are nowhere near where they should be?

It leaves it with a Government that faces a tricky political situation that it can no longer ignore.

 

 

 

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