- Australia’s coal share in power generation has dropped below 50% for the first time, with wind power now contributing over 25% of the mix.
- Despite the shift to renewables, Australia has delayed the closure of its largest coal power plant, Eraring, due to concerns about sufficient renewable capacity.
For the first time in history, coal’s share in Australia’s power generation mix has fallen below 50%, driven by a surge in wind power. According to recent data from Bloomberg, coal’s contribution to the energy mix dipped to 49.2% last week, while wind power’s share increased to just over 25%.
This milestone reflects Australia’s aggressive push towards renewable energy sources as it rapidly expands its wind and solar capacity.
Australia has emerged as a leading proponent of the energy transition, focusing on reducing coal dependence in favour of cleaner alternatives. However, this shift has introduced significant volatility into the electricity market.
Last year, Rystad Energy identified Australia as having the most volatile electricity market globally. This volatility stems from various factors, including frequent unplanned outages of coal power plants and disruptions to transmission lines caused by natural disasters such as cyclonic winds and bushfires.
The volatility underscores the challenges of transitioning to renewable energy while maintaining a stable power supply. Despite the growing share of wind and solar power, coal remains a crucial component of Australia’s energy mix. This was highlighted earlier this year when the Australian government decided to postpone the closure of the Eraring power plant, the country’s largest coal-fired power station.
Eraring, operated by Origin Energy, has a capacity of 2.9 gigawatts across four units. Initially slated for retirement in 2025 due to cost pressures from government-supported wind and solar installations, the plant’s shutdown has been delayed by two years.
The New South Wales government requested that Origin Energy extend the plant’s operation, citing insufficient wind and solar capacity to replace it reliably. As a result, two of the four Eraring units will remain operational for now. When fully operational, the plant provides a quarter of the state’s electricity consumption.
The decision to delay Eraring’s closure reflects ongoing concerns about the reliability of the renewable energy infrastructure. The New South Wales government hopes that by 2027, advancements in wind, solar, and battery storage will be sufficient to meet the state’s electricity needs without relying on coal power.
Until then, coal will continue to play a vital role in Australia’s energy landscape, even as the country strives to enhance its renewable energy capacity and reduce its carbon footprint.