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The Australian Energy Market Operator must improve its management of the national grid to avoid blackouts and power shedding next summer, energy experts have said.
The shutdown of Hazelwood coal-fired power station in Victoria removed 1,600 megawatts of power from the system, or more than 20 per cent of the state's energy supply.
Without Hazelwood, the national grid has become more vulnerable and the Australian Energy Market Operator (AEMO) said on hot days with high demand there would be a shortfall of between 200 and 500 megawatts.
Grattan Institute's energy program director Tony Wood said AEMO had to learn from past mistakes.
"The way we make sure we don't have the awful situation where people are without power and yet there are generators not running, that has to be avoided, and a lot of that rests with the way AEMO plans for the coming summer," he said.
Last year, AEMO was criticised for failing to act quickly and turn on the Pelican Point power station as South Australia experienced a statewide blackout.
AEMO chief operating officer Mike Cleary said it hoped to prop up the system with reserves from Pelican Point, which is coming back online in July, and power stations in Swanbank, Queensland and the Tamar Valley in Tasmania.
"When we look at the reserves that are available to us particularly from the gas fleet we believe we will be able to manage the system through next summer," he said.
However, he said if extra generators were not able to come online, AEMO could also look at moving some of the larger consumers' energy load to off-peak.
Like Hazelwood, much of the existing technology is old and sometimes unreliable.
"When we look at our supply demand there is enough reserves in the system, but again we have to understand that this is a mechanical and this is an electronic system, and it is subject to breakage and faults and if they occur then there will be risks of blackouts," Mr Cleary said.
Photo:
Workers farewell the plant by hanging their hardhats on the fence. (ABC News: James Manolios)
Reliance on renewables to increase across Australia
That sentiment was echoed by Victorian Premier Daniel Andrews.
In an interview on ABC Radio Melbourne, Mr Andrews said in terms of supply, the state would continue to be a net exporter of power.
"We have more [power] generated than we need and we'll continue to send power to other parts of the country as we have for decades," he said.
"That doesn't mean you won't have a problem with the distribution network or a weather event."
As more coal-fuelled power stations are closed around the nation, the grid will rely more heavily on renewable technology.
Mr Cleary said that presented new challenges and AEMO was working with market operators and governments to prepare for the new-look grid.
"There will be more intermittency in the system and... we will need to manage it going forward," he said.
"We are in transition and we need to be able to model and understand what the new technologies that we are bringing into the system do."
French company Engie defended its decision to close its Hazelwood plant immediately, instead of phasing it out.
Engie spokeswoman Lauren Carey conceded there was an expectation the plant would continue until 2025.
"We apologise if there has been a misunderstanding in the message, but again, it was an aspirational statement and there wasn't a commitment by the company that that would happen," she said.
Businesses 'need to work together'
With 750 people losing their jobs, the focus is now on resurrecting the economy of the region, which has an unemployment rate of 11.2 per cent.
Morwell laundrette operator Lindsay Mills has cleaned industrial overalls for Hazelwood power station workers for the past 23 years.
The contract makes up 22 per cent of his business and the plant's closure will cost him up to $300,000 a year in lost revenue.
"It's going to be hard times but we're looking at diversifying our business with the help of the State Government," Mr Mills said.
"But you've just got to man up and say well right let's push on, one door has closed, another one has got to open."
The Latrobe City Council estimates the power station's closure would take $340 million out of the local economy.
Mr Mills is working with the Latrobe Valley Authority to find new work at aged care centres.
"But to do that we've got to spend money and that's where we hope the Government will be able to assist us," he said.
"Morwell will survive without Hazelwood. It's got to. We've just got to use each other's businesses."
Topics: electricity-energy-and-utilities, science-and-technology, environmental-impact, alternative-energy, solar-energy, wind-energy, vic, morwell-3840, sa
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