Hazelwood power station closure: Electricity bills could rise 8pc, Victorian Government modelling shows
By Frances Bell
Updated 2 Nov 2016, 7:47pm
Hazelwood power station
PHOTO: The Hazelwood power station employs about 800 people. (ABC News: Karen Percy)
RELATED STORY: Hazelwood workers concerned for Latrobe Valley’s futureRELATED STORY: Victoria’s Premier to head taskforce planning for Hazelwood’s closure
MAP: Morwell 3840
Household power bills could increase by between 4 and 8 per cent following the closure of the Hazelwood power station, modelling released by the Victorian Government shows.
Hazelwood’s majority French owner, ENGIE, is tomorrow expected to announce the plant will close in March next year.
Hazelwood generates up to a quarter of Victoria’s energy supply, and the loss of its cheap, brown-coal fired electricity would push up power prices.
The ABC has obtained government-commissioned modelling that estimated the average residential power bill would rise by about 4 per cent in 2017, or $44 a year.
That’s the equivalent of 85 cents a week.
The analysis, by Carbon + Energy Markets, is based on futures market wholesale price projections.
However a separate analysis based on assumptions by the Department of Environment, Land, Water and Planning, predicted the average household bill would remain unchanged in 2017, then rise by about 8 per cent in 2018, or $86 a year.
That’s the equivalent of $1.65 a week.
“The reality will be that if Hazelwood closes there will be an impact on electricity pricing,” Treasurer Tim Pallas said.
“How much that will be we’ll need to continue to monitor.”
Hazelwood shutdown to cause instability: Opposition
However Mr Pallas said the closure of Hazelwood would not jeopardise Victoria’s energy security.
Looking to the future
With continued questions about the future of the Hazelwood power station, the next generation has its eyes set on renewable energy.
“We have been given absolute assurances that there is more than enough energy in the network to sustain and support the community’s energy needs,” he said.
Shadow Treasurer Michael O’Brien disagreed.
“Put it this way. Hazelwood provides 25 per cent of our electricity needs,” he said.
“If you’re sitting on a four-legged chair and one leg falls off, it’s not going to stay upright for very long.”
Mr O’Brien quoted analysis by Frontier Economics which forecasted retail prices for Victorian householders would increase by up to 25 per cent immediately after a Hazelwood shut down.
The closure of Hazelwood would cost about 800 jobs in the Latrobe Valley, which already has a high unemployment rate.
Earlier this week Premier Daniel Andrews said he was personally heading a taskforce to plan for the region’s future.