Hazelwood FAQs

Hazelwood was old, out of date and hadn’t been maintained. Its owner estimated it would cost $400 million just to meet basic safety standards.

Image: Gippsland Solar

On this page:

  1. What is Hazelwood?
  2. How polluting was it?
  3. Why did it close?
  4. A just transition for the community
  5. What does the energy industry say about phasing out coal?
  6. What do unions say?
  7. How will we meet our energy needs now?
  8. Power costs
  9. What needs to happen next?

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What is Hazelwood?

Hazelwood was a 1600 megawatt (MW) brown coal-burning power station in Victoria’s Latrobe Valley. When it was built, the engineers thought it would be closed by the year 2000.

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  • The supply of coal came from the adjacent Hazelwood mine – 150 metres deep and more than 3 times the size of the Melbourne CBD
  • Both the power station and mine are owned by ENGIE, a major multinational energy company, whose biggest shareholder is the French government
  • Australia’s oldest power station – construction began in 1964 and it was originally scheduled for retirement in 2005.
  • Hazelwood closed on 31 March 2017

How polluting was it?

Before it closed, Hazelwood had the highest emissions intensity of any coal power station in Australia, and possibly in the developed world.

A Latrobe Valley resident wipes toxic coal dust from their windowsill.

A Latrobe Valley resident wipes toxic coal dust from their windowsill. Source: Latrobe Valley Express.

  • Australia’s ‘dirtiest’ power station – Hazelwood produced more greenhouse gas emissions per unit of electricity than any other power source in Australia.
  • It emitted around 16 million tonnes of CO2 every year – 14 percent of Victoria’s annual greenhouse gas emissions and 3 percent of Australia’s.
  • It was the biggest source of toxic dioxin in the country.
  • It was Australia’s biggest source of toxic fine particulate matter (PM 2.5), which causes death of an estimated 18 people every year in Gippsland.
  • It used 27 billion litres of water a year – as much as Melbourne uses a month!

In 2014, the mine that supplies Hazelwood power station caught fire. It burned for 45 days, blanketing the surrounding area in toxic smoke. It was one of the worst pollution events in Victoria’s history. A government inquiry found this fire was linked to the deaths of at least 11 people.

 

Read more in our Hazelwood closure media briefing paper

Why did it close?

Hazelwood was old, out of date and hadn’t been maintained. ENGIE estimated it would have cost $400 million just to meet basic safety standards.

Out-dated? This is what computers looked like at the time Hazelwood was built.

  • Hazelwood’s owner ENGIE stated it was “making climate a priority” and committed to closing its most outdated coal plants.
  • Hazelwood’s closure is part of a broader trend in the shift from coal to renewable energy. Australia’s coal fleet is very old, with many at or close to their originally intended retirement age. The rapidly declining cost of clean energy and storage will also mean some coal power stations retire early.

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A just transition for the community

The Latrobe Valley deserves a “Just Transition” – to transform to a clean and sustainable economy in a way that is fair for workers and the community.

The Hazelwood transition deal gives my wife and me a future in our hometown

The Guardian

I was thrown a lifeline last Friday. Along with at least 150 of my work colleagues, and hopefully many more, I will be given the opportunity to continue to work in the Latrobe Valley power industry, despite the closure of the Hazelwood power station, my workplace of the last 28 years.
  • The state and federal governments have committed around $300 million to support economic diversification in the region.
  • Around 350 Hazelwood workers will be employed across other power stations and in decommissioning and rehabilitation of the site.
  • There are other economic opportunities open to the Latrobe Valley beyond coal.

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What does the energy industry say about phasing out coal?

Calls for a plan to actively manage the phase-out of coal-burning power stations are coming from diverse sources.

AGL: “A planned phase-out of coal plants is needed to reduce the risk of blackouts, because it will send a signal to the market that more renewable energy should be built.” (AFR March 5 2017)

EnergyAustralia (owners of Yallourn power station): “We need an orderly, realistic transition from large, older coal-fired power stations.” (AFR, March 5 2017)

The Business Council of Australia: “Victoria needs a managed transition away from coal-fired electricity generation. Given the profile of Victoria’s coal-fired generation fleet, a more managed transition policy would seek to minimise the risks of this transition on system security and individual communities throughout Victoria.” (BCA, September 2016)

What do unions say?

Many in the labour movement are calling for a Just Transition, meaning a process to retire coal power stations and shift to a renewable economy in a way that is just and fair for workers.

At a recent Environment Victoria event Colin Long, the Just Transitions Organiser at the Victorian Trades Hall Council, said the following: “The forces that are exploiting workers are the same forces that are exploiting the environment. The relentlessness of capital accumulation and the relentlessness of the growth based economy that is killing us all. Whether it’s the environment or humans and workers. So we have a shared interest in stopping that and building a better world.”

A particularly comprehensive articulation of this vision can be found here in the Australian Council of Trade Union’s Policy Discussion Paper.

How will we meet our energy needs now?

In response to some media reports, the Australian Energy Market Operator (AEMO) confirmed “the closure of Hazelwood will not compromise the security of the Victorian electricity system nor the broader National Electricity Market (NEM) next summer”.

In fact, experience since Hazelwood’s closure has shown that the major risk to power security is breakdowns at other old coal power stations just like Hazelwood. Especially in the heat when their cooling systems are more likely to fail.

However the massive wind and solar construction boom underway in Victoria will reduce the risk posed by old and faulty coal power stations.

Victoria's coal-fired power plants the least reliable in the country

The Age

Victoria’s brown coal-fired power stations are the most unreliable in the country, breaking down far more often than power plants in the rest of Australia and putting the stability of the state’s energy supply at risk.

A flexible grid of the future

  • Renewable energy, together with storage systems, efficiency and smart demand management can provide clean power 24/7.
  • Australia’s electricity needs to move towards a more flexible grid that can better support renewable energy – where renewable energy can be transported from places it’s being generated to ones where it’s not.
  • This process is already underway with the recent completion of several new grid scale batteries in Victoria

Read More    

Power costs

The major cause of recent power bill rises is energy companies gaming the system and exploiting flaws in the market for profit.

Australian energy giant AGL 'gouged' customers after Hazelwood closure, new research shows

ABC

Some of the nation's biggest energy companies have allegedly used the closure of Australia's dirtiest coal-fired power station to price gouge customers and make an extra $3 billion in wholesale profits, according to a new report.
  • Renewable energy is now the cheapest source of new electricity generation – building anything other than renewables will push power prices higher than they need to be.
  • Power bills are also determined by how much electricity is used, not just how much each kWh costs. Energy efficiency retrofits for homes can lead to savings of around $1000 per year on power bills – more than offsetting any short-term increase in prices. Businesses also have many efficiency measures available to them to stop energy waste and cut costs.

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What needs to happen next?

Hazelwood mine rehabilitation

Hazelwood mine over Melbourne CBD (to scale).

Hazelwood mine over Melbourne CBD (to scale).

  • ENGIE are under legal obligations to repair the damage caused by their mining activity, which means rehabilitating the mine to a standard acceptable to the community.
  • Proper rehabilitation of Hazelwood could create around 250 jobs in the Latrobe Valley, mostly employing current Hazelwood workers.
  • Mine rehabilitation also has the potential to help create something positive for the community, which could provide on-going sources of employment or public amenity – if done well. Poor rehabilitation could leave the community with a large industrial wasteland.

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A national transition plan

  • As global temperatures continue to rise, it becomes more and more urgent to curb our climate pollution. This means the rest of the coal power stations in Australia need to be phased out soon and replaced with clean energy.
  • Australia needs a national plan to phase out power stations in a way that supports communities and workers and that meets our international commitments to keeping global warming well under two degrees.

Read More

Header image provided courtesy of Gippsland Solar