In a significant energy policy shift, Australia’s largest coal-fired power station will continue operations for an additional two years beyond its scheduled retirement date. Origin Energy announced Tuesday that its Eraring facility in New South Wales’ Hunter Valley will remain operational until August 2029 rather than closing in 2027 as previously planned.
The decision follows extensive market analysis revealing insufficient renewable energy infrastructure development to compensate for the plant’s retirement. Origin CEO Frank Calabria emphasized that while substantial progress continues on renewable energy projects and transmission infrastructure, extending Eraring’s operational timeline remains essential for maintaining grid reliability and stable power supply during the transition period.
This extension addresses repeated warnings from the Australian Energy Market Operator regarding potential electricity shortfalls and system instability in New South Wales if the 2,880-megawatt facility were decommissioned prematurely. The plant originally faced closure in 2025 before receiving its first extension to 2027.
NSW Climate Change and Energy Minister Penny Sharpe endorsed the decision, noting it would help stabilize energy prices while the state continues its renewable energy expansion. Since the last election, NSW has increased operational renewable capacity by nearly 70% – equivalent to Eraring’s total output.
Origin maintains this temporary extension won’t affect its emissions reduction targets, including net-zero by 2050. The company plans to replace the retired plant with a major battery storage project, with construction anticipated to commence in 2031.