Government negotiates energy security agreement

Gas-fired electricity from Torrens Island Power Station will continue to flow until mid-2028, after the State Government reached an agreement with energy company AGL to retain generation capacity in South Australia which became necessary due to the Liberal-backed Project Energy Connect interconnector continuing to face extensive delays on the New South Wales side of the border.

AGL has agreed to keep its Torrens Island Power Station ‘B’ open until June 30, 2028, after initially announcing in November 2022 that it would retire all three remaining units at the facility by next year.

This was a direct consequence of Project Energy Connect and the closure was timed to coincide with the interconnector coming online.

Labor repeatedly warned while in Opposition that the interconnector would displace thermal generation – like Torrens Island Power Station – and delays to the interconnector could potentially leave the state exposed to a lack of firming capacity.

This is exactly what has happened. While the commissioning date for the interconnector has been delayed, the retirement date for Torrens Island Power Station remained the same, leaving the state exposed until the Malinauskas Labor Government negotiated this outcome.

As a result of this agreement, the Australian Energy Market Operator has confirmed South Australia will have greater reliability.

Last month, Vincent Tarzia’s Liberal Opposition announced an energy policy underpinned by a commitment to negotiate with AGL to extend Torrens Island’s operation. That was despite his former Government being the policy architects of its early demise and – even more bizarrely - despite AGL having already publicly confirmed it was engaging with the Malinauskas Government on a plan to keep the facility open, and had agreed in principle to do so.

But Mr Tarzia’s strange foray into energy policy – essentially copying the homework of the Malinauskas Labor Government – is now entirely redundant, with an agreement signed, sealed and delivered to retain generation from Torrens Island for a further two years.

Quotes

Attributable to Tom Koutsantonis

This is what Labor warned about when the Marshall Liberal Government made Project Energy Connect its sole solution to South Australia’s energy needs.

We said it would face delays, and we said that building an interconnector into New South Wales would displace South Australian thermal generation – and that is exactly what happened.

AGL’s closure of Torrens Island B is a direct consequence of the Marshall Liberal government’s plans to build interconnection into New South Wales.

It’s bizarre that Vincent Tarzia and his Shadow Minister for Energy and Net Zero, Stephen Patterson, have continued to celebrate the catastrophic impacts of their extension cord to nowhere, but it’s more bizarre still that they unveiled an energy policy to negotiate with AGL to keep Torrens Island open – despite its closure being a direct result of their own policies.

Well, the Malinauskas Government can save them the trouble – we now have an agreement signed, sealed and delivered that will keep Torrens Island Power Station B operational for a further two years, in a big win for SA’s energy security.

The Malinauskas Government has long maintained that gas is an essential part of our energy mix as a firming mechanism for renewables, and this will remain the case for the foreseeable future.