WA energy grid: AEMO calls for investment into green power, storage and transmission to ready for coal closure

A new wave of green energy investment will be needed to keep WA’s lights on, while uncertainty over Bluewaters Power Station’s future clouds the State’s electricity outlook. Analysis by the Australian Energy Market Operator shows new supply and reduced demand forecasts have cut the yawning shortage of energy previously expected later this decade. Yet there will still be a need for more renewables, longer duration storage and a huge expansion of power lines to prepare for the State Government’s closure of coal by 2030. “Over the last few years, strong investment, particularly in battery storage, has helped alleviate previously forecast risks to reliability in the State’s main power system,” AEMO WA boss Nicola Falcon said. “Ongoing investment in generation and storage is required to manage growing peak demand and offset power station retirements.” AEMO will consider an urgent tender to bring on extra capacity for this coming summer — the fourth consecutive year — as extreme heatwaves put record pressure on the grid. The forecast gap is 50 megawatts, smaller than last year. About 110MW of new generating capacity — roughly half a coal-fired unit — is needed for the 2027-28 summer. A much larger gap of almost 2GW looms by 2033 but AEMO is optimistic there are plenty of new power projects proposed to fill the shortfall. Crucial for AEMO will be further certainty about Bluewaters Power Station, near Collie, which has faced a major threat from the receivership of key miner and supplier Griffin Coal since 2022. Premier Roger Cook pledged $260 million to keep the coal burning until mid-2026 and has urged the two parties to ink a deal, warning that no more cash will be tipped in to support the companies. But amid uncertainty over the future beyond that date, AEMO will assume the plant closes due to a lack of coal supply. That is the major factor in the power shortages forecast through to the end of the decade and could put pressure on the Government to help find a resolution. It is not the only coal question for the Government. Buried in the last week’s Budget papers was the revelation Synergy was in talks over a major coal supply contract that posed a risk to the public utility’s costs. The government-owned business did not name which company was at the negotiating table but Synergy has long been supplied by Collie’s Premier Coal, owned by ASX-listed Yancoal. A government spokesman said rising costs had been a key factor in the 2022 decision to shut coal power by the end of the decade. “Synergy and Premier Coal have been long-standing partners in a coal supply agreement — but renewable power, backed by storage and gas, will provide the lowest-cost energy for West Australians,” he said. “That is why the State Government is delivering on a sensible, managed transition to a greater use of renewables, while ensuring electricity reliability and affordability continues to be paramount.” He said $6.4 billion would had been promised for the energy transition in the state budget.