What if the Latrobe Valley’s transition is brought forward?

LABOR took a policy of reducing Australia’s greenhouse emissions by 43 per cent by 2030 to the May 21 Federal election.

The new Prime Minister Anthony Albanese highlighted this number again in his opening address to the Quad leaders meeting in Tokyo this week, saying that his new government would stick by its 43 per cent promise.

But that all depends on Labor securing a majority of seats in the House of Representatives, at least 76 of the 151 seats, where presently the Australian Electoral Commission is giving them 75.

There’s also the issue of managing the wheeling and dealing with The Greens, who hold the balance of power in the Senate.

The Coalition said a 30% to 35% reduction by 2030 would be enough to meet our Paris commitment.

So, we’re set to go harder than expected, no matter what happens in the parliament.

But what will it mean for the people of the Latrobe Valley if Labor is forced to ramp up its targets, say to the 60 per cent emissions reduction by 2030 called for by Warringah independent Zali Steggall or the higher targets wanted by The Greens?

The Valley’s power stations would close even sooner, and recently, doubts have been raised about a proper transition plan for local energy industry workers, Latrobe Valley business and rehabilitation of the mines as a result of AGL’s demerger plans.

In February this year, AGL announced that it was bringing forward the closure of Loy Yang A, the firm’s lowest-cost thermal generation asset in Victoria, from the previous date of 2048, in line with the 2050 government target, by as much as eight years to between 2040 and 2048.

But during his address to the Macquarie Australia Conference on May 2 this year, AGL Energy Limited’s Managing Director and Chief Executive Officer, Graeme Hunt, revealed a willingness to look at an earlier closure date.

“As I said, we have announced earlier closure dates for Bayswater (NSW) and Loy Yang A (Victoria) however these revised closure dates are not the end of the story, Accel Energy (demerger owner) will continue to challenge these closure dates and look to see how they can improve on this, should the system be able to accommodate this in an orderly and responsible way.”

So, the Latrobe Valley’s power stations will close earlier anyway, but the end to power generation in the Valley could come even sooner if Labor is forced, by the new Teal MPs or The Greens to boost its 2030 targets.

The Voices of the Valley group recently raised its concerns:

“AGL are looking at a demerger of their company, splitting into two companies with AGL holding the renewable energy sector while the coal assets will be held by the new company ACCEL.

“Would this put the workers and community at risk, through a loss of transition plan, risk of mine rehabilitation not done properly or other issues?

“With a smaller company having less ability to run a proactive transition plan or fund itself. Split companies become economically weaker and more likely to go bankrupt.

“Would the AGL demerger be a good thing for the Latrobe Valley community going forward?

“Sydney billionaire Mike Cannon-Brookes is warning the Latrobe Valley that the planned AGL demerger does not contain a viable transition plan for coal communities.

“Mr Cannon-Brookes is instead accusing AGL of putting its coal and gas assets into a smaller and weaker company, which would have less ability to proactively plan for the future.”

So, what will happen to the Latrobe Valley, not to mention security of Victoria’s electricity supply, if its power stations are forced to close sooner rather than later?