Australia needs to rethink the exit of coal-fired power stations and the cost to consumers, a leading energy and gas supplier warns.
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Origin Energy CEO Frank Calabria said on Wednesday discussions continue with the NSW government on delaying the closure of Australia's largest coal plant Eraring.
A recent government report recommended a delay to the intended 2025 closure of the power station to support the reliability of the state's power supply.
"We do not shy away from the need to exit all coal-fired power generation as soon as renewable energy, storage and firming generation can replace it, as we have committed to in our climate and emissions targets," Mr Calabria told shareholders.
But chair Scott Perkins warned that costs of the energy transition will ultimately be borne by customers at a time when they have already been managing higher energy costs amid broader cost of living pressures.
"With renewable energy meeting around 35 per cent of supply today, the scale of the challenge ahead - and the investment required - is truly enormous," he told the annual general meeting in Sydney.
Mr Perkins said Australia needs the equivalent of building more than a hundred large energy projects of 250 megawatts over the remainder of this decade - or at least one major solar or wind project every month.
"What has become increasingly clear this year, with several major renewable and transmission projects delayed, is Australia is not moving fast enough," he said.
The delay to delivering new, cleaner energy assets is also causing governments to carefully assess the timing of coal-fired electricity exiting the market, including Origin's Eraring, he said.
"Managing reliability, affordability and community acceptance are all crucial is we are to maintain continued public support for the transition," he said.
Origin also owns the nation's largest fleet of gas peakers, which can turn on within minutes to cover peak electricity demand, and maintains a view that gas-fired generation will play an important role in ensuring reliable power supply.
"As more renewables enter the market, Origin's view is new gas-fired generation will be required and a functioning capacity mechanism that includes gas will be important to encouraging the necessary investment in this new firming capacity," Mr Calabria said.
Origin said the outlook for FY2024 has "marginally improved" with better operational performance and market conditions in the energy markets business and Australia Pacific LNG production rebounding strongly.
The company is also divesting 100 per cent of its interest in the Beetaloo Basin and has announced an intention to exit its upstream exploration permits, as part of a focus on the energy transition to renewables.
Origin said it expects to send shareholders a scheme booklet this week on the finalised Brookfield and MidOcean bid to acquire the company, which has been unanimously recommended by the board.
Australian Associated Press
