Here is the truth about not having enough gas to use as your decarbonisation transitional fuel:
South Australian households and businesses will foot a $20 million bill to prevent AGL Energy from closing part of the state’s biggest power station next year, and instead run it for another three years to stave off electricity shortages.
The side deal emerged after AGL advised it would close the remaining three units of its ageing Torrens Island B gas power station in Adelaide in 2026, citing the construction of a new interconnector cable between SA and New South Wales that is set to plunge the generator into deeper losses.
South Australia is by far the most advanced in the energy transition of any state yet it cannot cope without gas. The alternative dispatchable assets are not yet of enough scale.
Yet, unless the Albanese Government gets off its arse and does something about the gas price, SA will have some of the highest electricity prices in the land for as far as the eye can see despite being by far the least carbon-intensive.
This is clear in power futures:
Global gas and coal prices have also resumed their rise as the northern hemisphere winter closes in:
With local prices still locked at $20Gj and electricity prices back to triple pre-Ukraine war prices, which is worth 2.5% for the CPI.:
I’m not sure what it takes for the Albanese Government to see action on this front as urgent.
