Origin Energy's decision to shutter Australia's largest coal-fired power station by 2025 has been lambasted by the NSW government.
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With a generating capacity of 2922 megawatts, the Eraring Power Station at Lake Macquarie, near Newcastle, was initially slated for closure in 2032. It supplies about 20 per cent of the state's power.
Energy Minister Matt Kean says Origin's decision to expedite the closure was not in the government's control.
"I am disappointed by today's announcement and this is a difficult day for the Lake Macquarie community," Mr Kean said on Thursday.
"The planned closure of Eraring is especially tough for its workers, their families and local communities, many of whom have helped power NSW for decades and my expectation is that Origin does the right thing by its workers."
He announced the government would build a separate 700 megawatt battery in the Hunter-Central Coast region to supplement the state's electricity needs.
"We're building the biggest battery in the southern hemisphere.
"I can guarantee it (the battery) will be built before 2025 to keep the lights on," he said.
"The battery will act as a shock absorber to free up more capacity in the system to ensure that users can access more of our existing supply in the system," he said.
The electricity provider also said it would build a replacement battery at Eraring with a capacity of 700 MW.
Mr Kean also promised "a comprehensive jobs package to support those affected communities", within days.
Electricity prices might spike with the shift to renewables and jobs might be affected, he said.
"Our focus is solely based on ensuring that we keep the system reliable and we put downward pressure on prices," he said.
Federal Minister for Energy Angus Taylor described the decision to close early as "bitterly disappointing for all energy users"
"From households to small businesses to heavy industry - who rely on affordable, reliable energy to prosper," he said.
"This risks higher prices, like the 85 per cent increase we saw after the closure of the Hazelwood Power Station, and a less reliable grid."
The decision comes a week after rival AGL decided to bring forward the closure of its two biggest coal-fired power plants.
In contrast to the government's dismay, some environmental groups hailed the move towards clean energy as contributing in reducing climate pollution.
"Origin's announcement is a ray of hope for leaving a safe climate for our children," Nature Conservation Council Chief Executive Chris Gambian said.
The site had emitted 69 million tonnes of carbon dioxide, making it the second largest climate polluting facility in NSW, he said.
The clean energy shift would avoid up to 87 million tonnes of climate pollution in the long run.
"Origin has acknowledged the reality of the Australian energy market - that renewables backed by storage are the future of electricity," Glenn Walker, a senior Greenpeace campaigner, told AAP on Thursday.
He called on other providers, specifically calling out AGL, to "plot a timely transition from coal to renewables - anything less fails our energy workforce".
Australian Associated Press
