Australia's largest coal-fired power station could stay open for years longer than planned after a report into NSW's electricity transition exposed a potential energy shortfall.
The Electricity Supply and Reliability Check Up review, uncovered by the SMH on Tuesday, recommended extending the life of the Eraring coal plant which is due to shut in August 2025.
A spokesperson for Energy Minister Penny Sharpe says the government is considering the recommendations and will make the report and the government's response public by the end of the month.
"The government has always said all options are on the table when it comes to Eraring," the spokesperson told AAP.
The power station at Lake Macquarie on the NSW Central Coast has a generating capacity of 2880 megawatts - about 25 per cent of the state's electricity needs.
Operator Origin Energy, which is yet to see the confidential report, says it continues to engage with the government over plans to close the plant.
"We do not shy away from the need to exit all coal-fired power generation as soon as renewable energy, storage and firming generation can replace it," an Origin spokeswoman said.
Eraring is Australia's largest greenhouse gas emitter, releasing more than 12 million tonnes of CO2 equivalent into the atmosphere each year.
Tim Buckley, director of think tank Climate Energy Finance, says keeping the plant running would be a "massive retrograde step".
He says the estimated $200-$400 million a year in government subsidies needed to do so should instead be invested in NSW's energy transition.
NSW Greens energy spokesperson Abigail Boyd called on the Minns government to implement a clear transition plan, taking into account energy reliability, emissions reduction and supporting workers and communities.
"This 'will they, won't they' speculation is terribly distressing and frustrating for the dedicated workers operating these power stations," she told AAP.
"We should never have privatised these energy assets. If Eraring is to stay open a single day past its scheduled closure date, then it should be as a publicly-owned generator. The people of NSW are sick and tired of being the underwriters of fossil fuel capital."
Independent Lake Macquarie MP Greg Piper welcomed the recommendations, saying NSW does not have the storage capacity to make up for the loss in dispatchable power output Eraring's closure would bring.
"I'm concerned that if we do close Eraring early without having that capacity in the system we will see blackouts and brownouts and we will really be impacting on industry, on the local economy, but really turning people against the whole process of transitioning to renewables," he told ABC Radio Sydney.
The Victorian government on Monday inked a deal with AGL Energy to keep its Loy Yang A power station burning coal until 2035, but left the door ajar to closing the plant earlier if the reliability and security of the state's energy market can be ensured.
Australian Associated Press
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