Energy giant AGL has issued a further snub to the Turnbull government, insisting it does not plan to sell its ageing Liddell power station nor keep it open beyond 2022.
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In a statement to the Australian Stock Exchange on Wednesday, AGL said it was committed to closing the NSW coal-fired power station – Australia's oldest operating coal plant – as planned.
But power company Delta Electricity has indicated it could be interested in buying the plant, subject to price and the cost of upgrading the station to keep it running.
Prime Minister Malcolm Turnbull on Wednesday said the government was still in talks with AGL over the future of Liddell and it was too early to say if the government would give financial incentives to a new owner of the plant.
A report from the nation's energy market operator on Tuesday warned urgent action was needed to prevent blackouts on hot summer days. In response, Mr Turnbull said his government wanted to delay the closure of Liddell, in NSW's Hunter Valley, for at least five years.
It is slated to close in 2022, which AGL says is the end of the plant's operating life.
Mr Turnbull later said AGL was "prepared to sell to a responsible party", which would allow the power station to keep operating beyond the slated closure date.
Hours after Mr Turnbull's comments, AGL chief executive Andy Vesey wrote on Twitter that the company was "getting out of coal" and was committed to the closure date.
It backed this up with a statement to the Australian Stock Exchange on Wednesday morning, which said it "has made no commitment to sell the Liddell power station nor to extend its life beyond 2022".
AGL said it will continue to engage with governments, regulators and other stakeholders to "deliver appropriate outcomes".
Delta Electricity company secretary Steve Gurney said the company was interested in acquisitions in "the traditional coal-fired sector and in the renewable energy sector."
"A thorough due diligence process would need to be undertaken to understand the condition of the plant and the costs before any decision is made by Delta, but we would be prepared to undertake that exercise," he said.
Mr Gurney said the company had not spoken to AGL or the government about the plan but that the plant would fit well in its current energy portfolio.
At a press conference on Wednesday, Mr Turnbull said keeping Liddell open was "clearly an option" and it was "too early to speculate" on whether the government would give tax or other incentives to a buyer of the plant.
Mr Turnbull said the Australian Energy Market Operator would review the state of Australia's coal-fired fleet
"We have to look at measures that can achieve greater affordability and stability in the system in the here and now. It is early days with Liddell but the thing we can't afford to do is to … ignore the realities of the market, which is what Labor has done in the past.
"What we need to do now is identify the options to ensure we don't have a gap in dispatchable energy and extending the life of existing power stations is an option and Liddell is one of those."
The AEMO report said the closure of Liddell in 2022 would leave a 1000-megawatt shortfall of "flexible, dispatchable" capacity, which is energy that can be created on demand.
Mr Turnbull said it was a "big stretch" to suggest that implementing a clean energy target from 2020 – a recommendation of chief scientist Alan Finkel's review of the national electricity market – would close the energy gap in sufficient time.
"There is a lot more generation coming into the market, wind and solar, and that's good, we need more generation … but we also need to ensure that we have got that dispatchibility," he said.
"That can be provided by batteries but they've got limited capacity. It can be provided on a large-scale by pumped hydro but that takes years to build … all of those things take time."
Mr Turnbull said dispatchable, high-emissions energy such as coal-fired generation was "being driven out by low-emissions renewables which ... operate when the sun is shining or the wind is blowing".
"What you have seen is a colossal failure in the planning of our energy system. The Labor Party's approach has been one driven by ideology and, I have to say, idiocy.
"I mean, it really does beggar belief that you would, as they did in South Australia, allow their electricity system to be dominated by wind power, see coal-fired power stations close and not put in any measures to back-up that wind power when the wind wasn't blowing."
Labor's energy spokesman Mark Butler said it was important to ensure reliable, affordable power supply of electricity across the system as ageing power plants closed, and accused Mr Turnbull of "making stuff up as he goes along".
"Let's have an orderly plan that ensures the inevitable closure of these old power stations happen in a way that means there is still reliable, affordable supply of electricity.
"But what that means is having a plan to ensure that new investment occurs in Australia. The Finkel Report, the AEMO report, have made it clear what that is – it's a clean energy target.
"Yet the Prime Minister continues to sit on his hands and pretend that the solution is building new coal-fired power stations, or an extension of the Snowy Hydro scheme, that won't come on train, if at all, before the mid-2020s."
Government backbencher and former resources minister Matt Canavan on Tuesday derided AGL as "the biggest hypocrites walking around Australia".
"They are the largest coal-fired power producers in Australia and at the same time spending thousands of dollars on ads saying they're getting out of coal," he said.
