Australian authorities have given themselves the power to block coal exports if the resource is needed to ease the country’s crippling power crisis in the latest measure taken to avert the risk of blackouts.
Rising coal and gas prices, coupled with outages at ageing coal-fired power stations, have plunged the market into turmoil this week, forcing the Australian Energy Market Operator to take control of the wholesale market to ensure reliable supply of electricity to eastern states.
The government of New South Wales invoked emergency powers on Friday to oblige miners operating in the state to redirect coal heading overseas to local generators. The precautionary move was taken to strengthen energy security on the advice of AEMO.
“We’re just giving ourselves all the levers we need to give the community certainty that we’re doing everything we can to keep the system going,” said Matt Kean, the energy minister and treasurer for New South Wales, the country’s most populous state.
The energy crisis has highlighted the failure of Australia, one of the world’s largest producers of fossil fuels, to prepare for the transition to renewable energy sources by investing in modernising the country’s electricity infrastructure, analysts say.
“We are in an invidious position. It is a global story as there is a gas shortage and prices are skyrocketing but for Australia it is combined with coal-fired power stations going offline,” said Ben Oquist, executive director of the Australia Institute think-tank. The crisis has highlighted how a failure to prepare for renewable energy becoming a larger part of domestic supply was hitting the country’s consumers in the form of higher bills and potential blackouts, he added.
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