Difference between revisions of "Contract for Closure Program"
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In September 2012 the federal Minister for Resources and Energy, [[Martin Ferguson]], announced that plans for closure had been scrapped. In a media release Ferguson stated that "the Government could not be satisfied that entering into such arrangements would achieve value for money against the Contract for Closure Program objectives." He stated that regional adjustment funding which had been pledged to area affected by closure under the program would remain available to areas affected by the carbon price.<ref name=Fergie>[http://minister.ret.gov.au/MediaCentre/MediaReleases/Pages/cfc-cease.aspx "Contract for Closure negotiations cease"], Media Release, September 5, 2012.</ref> | In September 2012 the federal Minister for Resources and Energy, [[Martin Ferguson]], announced that plans for closure had been scrapped. In a media release Ferguson stated that "the Government could not be satisfied that entering into such arrangements would achieve value for money against the Contract for Closure Program objectives." He stated that regional adjustment funding which had been pledged to area affected by closure under the program would remain available to areas affected by the carbon price.<ref name=Fergie>[http://minister.ret.gov.au/MediaCentre/MediaReleases/Pages/cfc-cease.aspx "Contract for Closure negotiations cease"], Media Release, September 5, 2012.</ref> | ||
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| + | Ferguson told journalists that " I've said all along that there was no bottomless pit in terms of the amount of money available from the government's perspective to actually buy out electricity generation. On the basis of the outcome of discussions to date, I simply say there's no value for money for the government in continuing this process," he said.<ref>Chris Johnson, [http://www.canberratimes.com.au/national/green-light-for-dirtiest-power-20120905-25f3p.html#ixzz2HNNnHgT8 "Green light for dirtiest power"], ''Canberra Times'', September 6, 2012.</ref> | ||
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| + | ===Responses from power generators=== | ||
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| + | Following the announcement, TRUenergy boss [[Richard McIndoe]] told the ABC that he though the government lost interest in negotiations when it became apparent that power demand was falling substantially says dollar figures weren't exchanged during negotiations. "I think the concept (contract for closure) was a reasonable concept to pursue but obviously the government is under increasing budgetary pressure and I suspect they saw an opportunity here to achieve those carbon emission reductions on the back of that lower demand for electricity over the next decade," McIndoe said.<ref name=Spill>Celine Foenander, [http://www.abc.net.au/local/stories/2012/09/13/3589628.htm "Yallourn boss comes clean on closure contract"], ''ABC News'', September 13, 2012.</ref> | ||
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| + | McIndoe said that "we didn't really get to the point where there were negotiations to and fro about the actual number. I think that focus may have been with other generators," he said.<ref name=Spill/> | ||
==Australian government resources== | ==Australian government resources== | ||
Revision as of 09:59, 8 January 2013
{{#badges: CoalSwarm|Navbar-Australiacoal}}The Contract for Closure Program was announced by the Australian government in July 2011 as a part of its carbon price package. The government stated that the primary aim of the program was "to support the closure of around 2,000 megawatts of highly emissions intensive generation capacity in Australia by 2020, subject to negotiation with eligible generators."[1]
Contents
Background
The government stated that it aimed for plants to be closed in the period between 1 July 2016 to 30 June 2020 "although proposals for closure prior to 1 July 2016 may be considered."[1]
While the government's initial plan was for contracts for closure to be entered into by 30 June 2012[1] this timetable was extended. In a media statement the Minister for Resources. Martin Ferguson stated that "there are a number of complex commercial issues yet to be resolved including the need to ensure value for money."[2] Ferguson stated that "negotiations are expected to continue and the Government will endeavour to reach an outcome in the coming months."[3]
The government requested generators interested in retiring coal-fired plant to submit an expression of interest by October 21 2011. Subsequently it announced that five generators had been invited to proceed to the negotiation phase. The five are:[1]
Columns may be sorted by clicking on the headers.
| Power station | State | Company | MW Capacity | Annual CO2 (million tonnes) | Notes |
|---|---|---|---|---|---|
| Playford B Power Station | South Australia | Alinta Energy | 240 | 1.73 (2009) | The power station is not currently operating but available if necessary. Following the termination of the Contract for Closure Program, Alinta have stated that they are "considering the implications for the Flinders assets in SA and the potential for investment in solar thermal power".[4] |
| Energy Brix power station | Victoria | HRL | 110 | 1.59 | In June 2012 the Federal Minister for Resources and Energy, Martin Ferguson, the Minister for Climate Change and Energy Efficiency Greg Combet and the Minister for Regional Australia, Simon Crean stated announced that it would provide "$50 million through a restructuring package to help the Latrobe Valley-based company maintain its production of briquettes for a limited period of time so that downstream users have the required time and certainty to switch to cleaner fuels, such as gas."[5] |
| Hazelwood Power Station | Victoria | International Power Australia | 1,675 | 15.7 | |
| Collinsville Power Station | Queensland | RATCH-Australia Corporation | 180 | 1.32 (2009) | RATCH Australia announced in early June 2012 that its Power Purchase Agreement with Stanwell Corporation had been cancelled effective at the end of the month. While the Power Purchase Agreement was due to run until 2016, Stanwell Corporation agreed to pay RATCH-Australia A$99.57 million in compensation.[6] |
| Yallourn Power Station | Victoria | TRUenergy | 1480 | 15 |
Closure program terminated
In September 2012 the federal Minister for Resources and Energy, Martin Ferguson, announced that plans for closure had been scrapped. In a media release Ferguson stated that "the Government could not be satisfied that entering into such arrangements would achieve value for money against the Contract for Closure Program objectives." He stated that regional adjustment funding which had been pledged to area affected by closure under the program would remain available to areas affected by the carbon price.[7]
Ferguson told journalists that " I've said all along that there was no bottomless pit in terms of the amount of money available from the government's perspective to actually buy out electricity generation. On the basis of the outcome of discussions to date, I simply say there's no value for money for the government in continuing this process," he said.[8]
Responses from power generators
Following the announcement, TRUenergy boss Richard McIndoe told the ABC that he though the government lost interest in negotiations when it became apparent that power demand was falling substantially says dollar figures weren't exchanged during negotiations. "I think the concept (contract for closure) was a reasonable concept to pursue but obviously the government is under increasing budgetary pressure and I suspect they saw an opportunity here to achieve those carbon emission reductions on the back of that lower demand for electricity over the next decade," McIndoe said.[9]
McIndoe said that "we didn't really get to the point where there were negotiations to and fro about the actual number. I think that focus may have been with other generators," he said.[9]
Australian government resources
Website: http://www.ret.gov.au/energy/clean/contract/Pages/ContractforClosure.aspx
Articles and resources
References
- ↑ Jump up to: 1.0 1.1 1.2 1.3 Department of Resources, Energy and Tourism, "Contract for Closure", Department of Resources, Energy and Tourism website, accessed June 2012.
- ↑ "Australia extends talks on coal power plant closures", Reuters, June 29, 2012.
- ↑ Martin Ferguson, "Contract for Closure Negotiations Extended", Media Release, June 29, 2012.
- ↑ Alinta Energy, "Contract for Closure", Media Release, September 9, 2012.
- ↑ "Briquette Restructuring Package", Media Release, June 29, 2012.
- ↑ Oranan Paweewun , "Ratchaburi Electricity Australia Unit Terminates Power Purchase Contract", Euroinvestor, August 14, 2012.
- ↑ "Contract for Closure negotiations cease", Media Release, September 5, 2012.
- ↑ Chris Johnson, "Green light for dirtiest power", Canberra Times, September 6, 2012.
- ↑ Jump up to: 9.0 9.1 Celine Foenander, "Yallourn boss comes clean on closure contract", ABC News, September 13, 2012.
