Press conference - Liddell Power Station
DAMIEN NICKS: First, thank you all for coming along this morning to this great Hunter weather they’ve put on for us today. My name’s Damien Nicks, CEO of AGL With me today is GM Len McLachlan, GM of Bayswater and Liddell. I’d also like to thank Minister Bowen for joining us here today.
This is a significant week for AGL, a significant event for Liddell employees – after almost 52 years it is time to retire Liddell from service both safely and reliably. Importantly for us today and this week is all about our employees celebrating both the contribution and also reflecting of what Liddell has meant to this state, to this community and to its employees.
So I might on that note hand over to you, Minister.
CHRIS BOWEN: Well, thanks very much, Damien, and thanks for having us here today. It was important in my view to come here today. Today is really about two things: respect and thanks. This power station has powered Australia, kept the lights on, for more than 50 years. While the engineering is impressive and the technology is important, much more important than that is the workers who for more than 50 years have played a part in powering our country.
Obviously this is a big change for Liddell, it’s a big change for the Hunter, it’s a big change for the energy grid, it’s a big change for the country. But what doesn’t change is the fact that we value and respect and thank workers for everything they do. So I enjoyed today talking to the workers and taking their questions, but, most importantly, thanking them on behalf of the country. And by thanking them, thanking everybody who came before them since 1971 for everything they’ve done.
Our economy is changing, our energy system is changing right around the world. But areas like this will continue to be valued and respected and areas like the Hunter will continue to power Australia into the future for many, many years to come. That will change, the energy will change, the energy mix will change, but one thing won’t change – the fact that areas like the Hunter will increasingly power Australia.
So that’s really the simple message from me, as I gave to the workers and to anybody watching tonight at home who is former worker or the family of a worker, the message for them is as well: thank you for everything, and you have the respect and thanks of the government and the country.
Happy to take questions.
JOURNALIST: Minister, the Hunter Power Project was originally meant to come online to coincide with the closure of Liddell. Obviously that won’t happen. It’s a relatively short distance away; will you be going along today to inspect progress?
CHRIS BOWEN: Not today. I keep in regular contact with Snowy management about both the Hunter Power Project and Snowy 2.0, obviously the two big projects that are underway. But today the sole purpose of my visit to the Hunter is to thank the workers of Liddell.
JOURNALIST: Are you concerned about that gap in timeline from Liddell closing down to Kurri Kurri coming online in more than a year?
CHRIS BOWEN: It would have been better if Kurri Kurri wasn’t running four months late, but it is. But certainly AEMO has advised me very clearly and all my state and territory colleagues that the closure of Liddell can be absorbed into the system without any disruption or threats because of all the dispatchable renewables that have come on in recent times.
AGL has plans for this site, of course, which are very important including a battery. But that is not replacing Liddell as such because other work – you need to replace places like Liddell before they go out of the system, and that’s the entire focus of all the energy transformation work that we’re doing.
JOURNALIST: What about beyond 2025? Are you worried with four more coal-fired power stations going off across the country?
CHRIS BOWEN: Well, that is just part of what we’re managing. And we work very closely with the companies, be it AGL or Origin or any of the operators. We work very closely with AEMO. I work very closely with my state and territory colleagues. That’s why we’re doing Rewiring the Nation, which I announced here in the Hunter with the then Premier of New South Wales and the Prime Minister. That’s why we’re doing the capacity investment mechanism, which, again, was announced here in the Hunter. That’s why we’re doing all those things – to ensure that new, renewable, dispatchable energy and storage comes on. We need a transition and a transformation which is faster but more orderly.
JOURNALIST: Senator Ross Cadell has come out today asking you to explain why the families are paying up to 58 per cent more for energy and rather than saving $275 per year as you promised?
CHRIS BOWEN: Well, Mr Cadell I saw has said a few things. He said that. He said that I think I need to explain why Kurri Kurri is running late. Well, I say this to all these questions: thanks for your contribution. You’re a member of a government who presided over four gigawatts of dispatchable power leaving the grid and one gigawatt coming on. We’re cleaning up the mess that was left by Mr Cadell and his colleagues. When you have four gigawatts leave and one gigawatt come on, of course that puts pressure on power prices. He voted against the government’s energy intervention last December. If it wasn’t for that energy intervention, power prices would have gone up 50 per cent. Mr Cadell should explain why he voted for higher power prices. He should explain why he was a member of a government which presided over an absolute train wreck of energy policy – 22 energy policies in nine years. That is a big part of the reason why we’re facing the challenges we’re in today. Mr Cadell can provide all the commentary from the sidelines he likes, we’re getting on with the job of managing this transformation.
JOURNALIST: Regarding the Hunter offshore wind project, you’d be familiar with the MUA and ETU’s call to expand the zone. Is that something which you’d be interested in?
CHRIS BOWEN: Well, we’re in the middle – we’re almost at the end of consultation, which I launched, as you recall because you were there, in Newcastle a little while ago. I’ll take the submissions. The zone is smaller than, say, Gippsland, for very good and important reasons – defence-related reasons. That won’t change. But I’ll look at all the submissions. I get a weekly update on how the submissions are going. The consultations, they’ve been going well. There’s been a lot of community interaction, which I very much welcome. Of course there’s a range of views. Some people would like no offshore wind, some would like more offshore wind. I understand that. We get the balance right.
JOURNALIST: What about residents and former workers in the Hunter Valley? There’s many that have come out and they don’t want Liddell power station to close. Some are sceptical about green energy. What would you say to those former workers and residents in the area?
CHRIS BOWEN: Well, I’d say two things: firstly, this power station behind us, as I said before, has done great work for Australia, but it’s time has run. It’s more than 50 years old. It’s in the top one per cent of old power stations in the world. There’s only one per cent of power stations in the world older than Liddell. That means for management for workers, inevitably it’s going to get harder to run and harder to keep operating. That’s just a statement of fact. Keeping Liddell open is not a viable solution for AGL, for the country, for anyone. It’s just not a viable solution.
I understand people – many people have views about the energy grid and what should be in it and what shouldn’t be. The fact of the matter is, our entire world is making a transformation to renewable energy because we have to. Our climate is changing, and it’s absolutely an essential part of the transformation our job is to make sure that that transformation is smoothly managed. You know, some people say, “Oh, the wind doesn’t always shine” – sorry, “The wind doesn’t always blow and the sun doesn’t always shine.” Well, the rain doesn’t always fall either. We store water. We can store renewable energy. Renewable energy is good for energy security. It’s the cheapest form of energy available anywhere in the world, and it’s a transformation that Australia is well on the road to embracing.
JOURNALIST: Just on that point of renewables, the state government here has put in place renewable energy zones to help that transition. How critical do you think they will be in transitioning communities, particularly in rural areas like the Hunter?
CHRIS BOWEN: They’re an important part of the answer here in New South Wales. Every state is different. Not every state has renewable energy zones. Some states regard their whole state as a renewable energy zone. That’s a matter for them. We work with state governments across the board. I’ve had a great meeting with Penny Sharp, the new Minister for Energy in New South Wales. I was meeting with my West Australian colleague in Perth last week. I was meeting with my South Australian colleague in Adelaide last week. I am constantly talking to the state energy ministers and working with whatever policies they have in place, including renewable energy zones. They’re an important part of the mix in New South Wales. Our Rewiring the Nation policy is designed around renewable energy zones, because that’s the agreement that I struck with my former colleague the New South Wales Energy Minister.
JOURNALIST: AGL has a solid plan for the transition of the workers from this site to Bayswater and [indistinct] to retire. Are you satisfied that your government is doing enough to support communities in the clean energy transition process? I’m talking particularly about the social transition and the economic transition, retraining and things like that?
CHRIS BOWEN: There’s always more to do – you’re right. I don’t mind saying AGL has done a great job here, a great job at helping the workers through this transformation. That’s my expectation of all the energy companies who own power stations. That’s my expectation, but I’ll also give credit where it happens, as I do to Damien and his team. There’s always more to do. We’ve said that we are constantly on the lookout for more to do. There’s a budget in a couple of weeks, and I look forward to your reporting on the budget.
JOURNALIST: Just on that, can you confirm how many job losses there will be from Liddell?
CHRIS BOWEN: I think there’s 130 people currently here, but Damien can answer it.
DAMIEN NICKS: Yeah, so there’s no forced redundancies as part of this plan. We’re transitioning more than 50 per cent of our workforce across to Bayswater. The balance are either taking a retirement or going for other opportunities. So it’s been well planned, well managed over the seven years. Lots of time to get organised for this. And, you know, I think the workforce would say we’ve done this well and we’ll continue to think about how we use that as a template going forward.
JOURNALIST: It’s about 300 workers at the moment, is that that’s all right?
DAMIEN NICKS: That’s about right, yes.
JOURNALIST: One more, Minister, sorry, on the gas code today. How did your government land on the July 2025 end date for that?
CHRIS BOWEN: Well, this is out for consultation. We’re releasing it today for consultation. It’s a result of – it’s followed extensive consultation with gas companies and with gas users and it’s now time to broaden that consultation. It strikes a good balance. It maintains the gas price cap, as you said, for a period of time. It’s out for consultation. You don’t want to keep a regime in place forever, nor do you want to see it leave too quickly. So we do that balancing work. I think it strikes a good balance, but I’m looking forward to getting the feedback of everyone else over the next few weeks.
JOURNALIST: You described the code of conduct as a price anchor. How will it work in practice to sure up supply as well as keeping those reasonable prices
CHRIS BOWEN: Well, what it will do is ensure that gas companies have to comply, and if they would like a different set of arrangements they’ve got to provide the government with an enforceable undertaking, which can be enforced under law, to supply gas at a price which has been agreed in advance. That is key to ensuring that big industrial users and households have access to gas, Australian gas, at reasonable Australian prices.
JOURNALIST: How will that ACCC regime work – sorry, that implementation there–
CHRIS BOWEN: There’s a long consultation paper and a draft code out today. It’s all there for people to see.
JOURNALIST: How much power is Liddell producing today?
LEN MCLACHLAN: We just have two units on about 600 megawatts, and obviously the one unit will be closing this afternoon.
DAMIEN NICKS: And the final unit being planned for Friday.
JOURNALIST: How has it been this week, Len? You turned one off on Monday as well. What is it like amongst the workers when you see it trickle down?
LEN MCLACHLAN: Mixed feelings. Obviously, you know, it’s an important asset, but they also understand that, you know, this actually has to take place. We’ve been planning it for a long time. And so I think this is kind of the culmination and the celebration and also showing respect for the fact that what it’s done and what it means for the community and what it means to our people.
DAMIEN NICKS: And I think it’s a reflective mood, really reflective mood. There’s huge amounts of history here in this plant. You know, a number of our workforce have been here over 40-plus years. So there’s lots of history, lots of great stories. And for us it is about celebrating and recognising that contribution that Liddell and its people have made. And, you know, at the end of this week on Saturday we’ve got an employer reunion coming together with over twelve to thirteen-hundred people. So that’s a sense of how important this plant has been for the people here in the community.
JOURNALIST: I guess on that note, do you mind just quickly running us through, you know, what’s next?
DAMIEN NICKS: Yeah, sure. So, clearly for us it’s about how we transition this site into an industrial energy hub. So the first plan of attack will be putting batteries on board, but there’s a whole range of plans there whether it be wind, solar but also industries outside of energy. And that’s really important – how we actually diversify this site and we bring more industries on to this site, whether that be agriculture. And we’re also talking to the Indigenous communities as well about how we grow that out. So importantly success looks like transitioning, transforming this site over a number of years so it becomes an industrial energy hub of the future.
CHRIS BOWEN: We might wrap it there guys.
JOURNALIST: Thank you.
CHRIS BOWEN: Cheers.