Australian government refuses to rule out new coal-fired generation as it ticks off gas plants in Queensland and Victoria

This article is more than 9 months old

This article is more than 9 months old

The federal government has announced it will underwrite two new gas-fired power stations, with Scott Morrison saying it may still greenlight coal-fired generation for Queensland and New South Wales.

Even as Australia suffers through a record-breaking heatwave Morrison said the government would continue to explore all power options and would not be deterred by “lots of shouting noises” and instead would listen to “those quiet still voices”.

The energy minister, Angus Taylor, has ticked off on underwriting a 132-megawatt gas plant in Gatton, in Queensland’s south-east, with another 220-megawatt gas generator project in Dandenong, Victoria, also passing muster.

The private companies that put forward the proposals, Quinbrook Infrastructure Partners in Queensland and the APA Group in Victoria, now have the go-ahead to continue with the projects if they can secure their own finance.

Prime minister, you need a credible climate policy. It's too dangerous to keep pretending you have one | Lenore Taylor Read more

But on Monday, in the midst of Australia’s record-breaking heatwave and extended bushfire crisis, Morrison told Sydney radio 2GB the government was still considering coal-fired plants as part of its energy mix.

“You need the whole mix, there is no doubt about that,” Morrison said.

“Firstly, there is a proposal for coal still up in north Queensland which we are accepting a report on very, very soon, there are some others in New South Wales and we will see where that goes.

Sign up to receive the top stories in Australia every day at noon

“I am quite agnostic, just as long as it is reliable and it is cheaper … You deal with the environmental challenge, you make sure you keep your economy growing and get power prices down.

“That’s that’s what I’m trying to do. That’s what I promised the Australian people I’d do and we’re getting over that. There’ll be lots of shouting noises elsewhere, but I tend to listen to those quiet still voices.”

The Gatton and Dandenong plants are among the first new generation projects to get underwriting approval from the government, as part of its long-term plan to boost and stabilise Australia’s energy market.

Remaining on the shortlist are another three gas projects, six pumped hydro proposals and a NSW coal-fired power station upgrade at Vales Point at Lake Macquarie.

What Albanese could have said: we lied – Australian coalmines have no future | Richard Flanagan Read more

Under the new generation underwriting plan, which was recommended by the ACCC, the government will guarantee a set amount of the electricity the companies generate will be purchased for a set period into the future.

Cabinet signed off on a shortlist of 12 generation projects in March, including “one very small” coal project in New South Wales.

In an attempt to pacify Queensland MPs still antsy ahead of the May election, the government also commissioned a $10m feasibility study into the benefits of reviving the decommissioned Collinsville coal-fired plant, in the state’s north.

That announcement was pre-emptively celebrated by Barnaby Joyce as a fait accompli, but was walked back as a “next step” later that same day.

Barnaby Joyce (@Barnaby_Joyce) So we have got ourselves a Coal Fired power station for Qld. Very good

The Collinsville feasibility study is due early next year. The final agreements on underwriting the gas projects are expected to be made around the same time, with construction unable to start until the companies secure private finance.