Australia’s biggest coal plant to close early with renewables in ascendancy

Australia’s biggest coal-fired power plant is set to close seven years early as surging investment in renewable energy continue to drive down prices and weaken coal plant economics.

Origin Energy could shutter the Eraring facility, located in a coal mining region North of Sydney, as soon as August 2025 in a move that would follow rival AGL Energy, which last week announced plans to bring forward the closure of two of its coal plants.

“The reality is the economics of coal-fired power stations are being put under increasing, unsustainable pressure by cleaner and lower-cost generation, including solar, wind and batteries,” Origin CEO Frank Calabria said.

The company is assessing plans to install a 700MW battery at the site, which would have more than double the capacity of the country’s largest existing facility – Neoen SA’s Victorian Big Battery.

Origin’s announcement is in line with a requirement to give three-and-a-half years notice before closing a major plant. The proposed battery and continued growth in renewables and rooftop solar will mitigate the impact of the Eraring plant closure, which can meet around a quarter of the power needs of New South Wales.

Australia’s total solar energy installed capacity recently exceeded 25GW after a record-breaking 5.2GW of solar PV additions in 2021. Up to 3.24GW of this was rooftop installations by households and businesses.