It seems that history is about to repeat itself.
In 2015, South Australia faced skyrocketing electricity prices after owners of the Northern power station announced its closure.
Now Victoria may be about to face a similar crisis with Fairfax media reporting that the Hazelwood power station in the Latrobe Valley could close as early as April 2017.
Major owners of the Hazelwood power station, Engie, have not confirmed whether the plant will be shut down, stating that no final decision has been made.
However, there is speculation that a decision on the future of the power station, and the jobs of up to 1,000 employees, will be made at the next board meeting in October.
It is believed factors influencing the likely closure include the age of the power station, changes to the current electricity market, and a slow dissolution of the station’s “Social License to Operate” as the community has become increasingly aware of the power plant’s negative impact on the environment.
About Hazelwood power station
The Hazelwood power station is almost 50 years old and one of the oldest coal-fired stations still in operation. Known for being one of Australia’s highest polluting power plants, Hazelwood has long been targeted by environmental activist groups lobbying for its closure.
As a major provider of electricity to the Victorian state, the power plant has faced increased scrutiny and speculation in recent months after Engie’s chief executive announced in May that it was investigating possible options for the power stations’ future, including selling or shutting it down.
Closure of the Hazelwood power station, which is responsible for supplying 25% of Victoria’s electricity could see the average Victorian household paying an increase of up to $100 a year for electricity. As the second largest plant in Victoria, the closure of the power station will have a significant impact on the demand and supply of electricity in the state.
The closure of the Northern Power Station in South Australia left a trail of destruction across the state with electricity prices rising to $400 per megawatt hour. The closure of Hazelwood will have a ripple effect across the country but particularly on South Australia who import up to 15% of power from Victoria.
The speculation surrounding the possible closure has already seen increases in the forward price for electricity, providing insight into where investors anticipate fixed price points will be in the future. Prices have already surged from $55 to $62 a megawatt hour for Victoria commencing in mid-2017.
As evident by the South Australian energy crisis, the closure of the Hazelwood power station will drive up household and commercial electricity bills and have a significant impact on power prices. Bulk Energy are recommending that customers renew electricity contracts now given the likelihood of price rises in the immediate future.
Bulk Energy offers residential customers and commercial businesses the opportunity to lower their electricity costs through the power of bulk buying. Buying in bulk provides customers the opportunity to secure more competitive rates without paying any hidden or unforeseen costs.
Contact Bulk Energy today on 1300 46 2855 and let us do the work to save you time and money.
Image courtesy of the ABC