Big batteries are in competition with gas-fired electricity this winter and beyond as Australians face blackouts, soaring power bills and climate change, writes MARION RAE.

ANOTHER couple of lucky winters should see Australia through the exit of coal-fired power without blackouts.

But we may be fooling ourselves that the electricity grid can cope, Joshua Stabler, managing director of system specialists Energy Edge, warns.

Mr Stabler said the worst thing for the national electricity market would be for there to be no bad weather or other extreme events this winter, or the next or in 2025.

“It’s like going into a casino and winning the first time – it’s really, really bad luck because then you think it was you,” he said.

“Then we might think that we’re fine, we might let Eraring go, thinking the worst-case scenario hasn’t happened, therefore it can’t happen.”

Eraring, located south of Newcastle, is Australia’s largest coal-fired power station and biggest single emitter of greenhouse gases.

Last year, owner Origin gave notice that Eraring could close seven years earlier than planned and the recently elected NSW government is mulling whether to pay to extend the generator’s life.

Penny Sharpe, NSW Minister for Energy, said “all options are on the table” when it comes to Eraring.

“The proposed closure of Eraring in 2025 is a challenge for energy reliability,” she said.

For Origin, the economics of coal-fired power had come under unsustainable pressure from cleaner and lower-cost generation, including solar, wind and batteries.

“By default, transition is disorderly,” Mr Stabler said.

Big generators looking at financial losses for the next four years don’t want to stay on and the resulting energy market gaps, until enough renewables come online, will be expensive, he said.

“If these assets leave, it’s going to be chaos,” he added.

Energy experts say Eraring’s closure will have a far greater and potentially more dangerous impact on the grid and energy security than last month’s closure of AGL’s Liddell plant.

While the 50-year-old Liddell plant had become inefficient and unreliable, Eraring still provides one-fifth of NSW’s electricity.

Last winter, flooded coal mines and other events took 40 per cent of coal-fired generation offline. Some 5000 megawatts of coal-fired generation remains offline heading into this winter.

Snowy Hydro 2.0, intended to support the transition of the east coast electricity grid, has been delayed until 2028 at the earliest.

Meanwhile state and federal governments are supporting the development of big batteries and neighbourhood-scale projects to support a cleaner grid.

Energy regulators and governments support the use of gas as part of the energy transition, despite criticism.

The industry argues the latest gas-fired generators have half the emissions of coal power plants and can flick on and off to meet peak demand.

AGL’s new “fast start” Barker Inlet gas plant in Adelaide came online in 2019 and has decades to run, alongside the 250-megawatt Torrens Island battery, which is expected to be operational within months.

A grid-scale battery is on the drawing board after Eraring is shuttered.

“Batteries are in competition with gas plants,” chief operating officer at AGL Markus Brokhof told AAP.

Batteries, which can charge when prices are low – or even negative – and discharge when prices are high, suit several hours use, Mr Brokhof said

“If it goes beyond four, five, six hours, there is no storage technology available at the moment,” he said.

Instead, “gas peakers” such as the one on Torrens Island can fire up in five minutes to meet periods of peak demand – at a price.

NSW is only a third of the way to its renewable energy target and interconnectors need to be built to link states.

The Australian Energy Market Operator recently announced long-term agreements for $2.5 billion worth of renewable energy projects to be connected to the grid by the time of Eraring’s exit.

These projects are the first round of a rolling 10-year plan for tenders every six months as NSW exits coal and moves to renewable energy.

Two solar farms, a wind farm and a long-duration battery will together contribute 1.4 gigawatts of renewable energy generation in NSW.

AEMO has forecast that these projects could displace up to 11 million tonnes of carbon emissions over the 20-year contract.

But the new generation means that NSW has locked in a mere 4.1GW of its legislated 12GW target by 2030. 

The New England Solar Farm in that region’s renewable energy zone, Stubbo Solar Farm in the Central West Orana Renewable Energy Zone and the Coppabella Wind Farm in the Southern Tablelands will be plugged in.

In an Australian-first, an agreement was also awarded to RWE Renewables Australia’s long-duration chemical battery that can potentially deliver at least eight hours continuous discharge of stored electricity – and change the economics again. 

“You don’t expect that you would have continuously bad luck, unless it’s not luck,” Mr Stabler said.

“Unless it’s failure, like fate, bad engineering or something else that has resulted in the power station being unreliable, and that ‘unreliable’ is now a permanent feature of the market.”

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