The Australian Energy Market Commission (AEMC) has approved a rule change allowing South Australia to reactivate mothballed gas power generators in case of a gas shortage.
The decision means the Australian Energy Market Operator (AEMO) can contract Engie to restart the Snuggery (63 megawatts) and Port Lincoln (75 megawatts) peaking generators if needed before the completion of the long-awaited interconnector to New South Wales.
SA Energy Minister Tom Koutsantonis said the State Government makes no apology for acting decisively to secure backup generation and ensure a consistent supply in the event of a gas shortage.
“I am glad the AEMC has agreed to our request to grant the South Australian Government authority to direct Engie to utilise two currently mothballed power stations at Snuggery and Port Lincoln if required between now and when the long delayed interconnector to New South Wales comes online,” he said.
The state government pushed for the change after AEMO’s 2024 electricity statement of opportunities flagged potential reliability gaps, including in South Australia.
Under previous rules, AEMO could not call on mothballed generators for backup, even if they remained technically available.
Koutsantonis argues the issue stems from the former government’s decision to sell off state-owned backup generation, which they claim has left a lasting legacy of energy insecurity.
The government has also asked Engie to explore the use of synthetic fuels or ‘green diesel’ should the generators be needed. The company is currently assessing this option.
“The State Government makes absolutely no apology whatsoever for moving forthrightly to secure appropriate backup generation that ensures there is consistency of supply in the event of a gas shortage,” Koutsantonis said.
“In any system, it makes sense to back up thermal generation – and the backup for thermal generation is diesel.”
“This is not remarkable – almost every jurisdiction in the country has diesel capacity.”
“The strong intent is that this safety-net need never be used – but it is simply common sense to ensure we have every available lever to pull in the event of a gas shortage.”
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