The Australian Energy Market Operator (AEMO) has been informed by AGL that it will mothball one of the four operational Torrens B units, Torrens B1 unit, in October FY22.
The decision follows the continued decline in South Australian forward prices and the volume of new capacity that has come into the market, creating challenging conditions that don’t support the financial viability of operating all four generation units.
AGL Chief Operating Officer, Markus Brokhof, said AGL has made the decision to mothball one unit following careful consideration of reliable supply against the changing capacity requirements and pricing.
“We will continue to provide South Australians with access to reliable and affordable electricity. We have assessed all publicly available information and are confident there is sufficient capacity available to AEMO to ensure system strength,” Mr Brokhof said.
“Torrens Island continues to be an important site for our future generation plans, including its development as a low-carbon industrial energy hub of the future.
“Construction of our 250MW grid-scale battery is planned to begin later this year, making it the first of AGL’s planned 850MW of batteries to get underway.
“This new grid-scale battery, along with the Barker Inlet Power Station that commenced operations in 2019, demonstrates our commitment to playing a leadership role in the state’s energy transition.”
Based on the power station’s maintenance cycle, AGL has identified the B1 unit as the most appropriate to be mothballed and preserved for recall. The planned recall time for the mothballing will be six months.
Mr Brokhof said that the decision to mothball this unit would have no impact on any of AGL’s 400 South Australian jobs.
AGL will continue to operate the remaining three B units, along with the Barker Inlet Power Station, and will review the decision if there are any material changes to the market conditions.
At Torrens A, AGL has mothballed three units, with the remaining unit to be mothballed this September, with retirement planned for September 2022.