Private plant knocked back for Kalgoorlie power bid

The private power plant which supported Kalgoorlie during last week’s power outage was, in 2023, rejected by the state government in favour of its own facility, which tripped when it was needed.

Goldfields Power’s 110-megawatt Parkeston power plant provides energy to nearby goldmines and is fed by gas from the Woodside-operated North West Shelf through the Goldfields Gas Pipeline.

The plant is operated by TransAlta and jointly held with Super Pit owner Northern Star Resources.

In 2022 privately-owned Goldfields Power was bidding against government-owned Synergy’s 62-megawatt West Kalgoorlie facility for a Western Power contract to provide backup power to the eastern Goldfields under what is known as a network control services contract.

A Western Power spokesperson said the utility provider opted to extend Synergy’s longstanding contract to engage its facility during maintenance and unplanned outages.

Synergy’s now 40-year-old West Kalgoorlie turbines were scheduled for retirement in September 2018 when the previous deal ended.

“Several years ago, Western Power took steps to minimise the impact on the Kalgoorlie-Boulder area when undertaking planned outages for network maintenance and upgrades and instigated, via a commercial process, for a contract for backup generation,” a Western Power spokersperson said.

“Western Power has an obligation under the Network Quality and Reliability of Supply Code 2005 to restore and maintain forty-five megawatts in the eastern Goldfields to supply essential service loads and the majority of small use customers as soon as is reasonably practicable during a planned or unplanned outage.

“Western Power started a commercial process in 2021 to re-test the capability of the market to provide the service required.”

While that contract went to Synergy, the spokesperson said future commercial opportunities would be made public on the utility provider’s website.

Power down

Last week, the West Kalgoorlie facility tripped soon after firing up, exasperating a major power outage which, at its peak, affected about 23,000 people across the Goldfields, Wheatbelt and Great Southern.

A Synergy spokesperson said the turbine station tripped after initial ramp up when called upon on Wednesday evening after storms destroyed Western Power's sole transmission line to Kalgoorlie.

The station was restarted on Thursday and technicians found no repairs were needed.

Energy Minister Reece Whitby has directed Synergy to review the cause of the failure, which WA Premier Roger Cook hinted on Friday appeared to be due to the plant requiring grid power to start up.

“What we don't know was whether there was a fault in the actual turbine or if there was a fault in the network that resulted in the turbine not being available,” Mr Whitby said.

“But there is an issue with the turbines in Kalgoorlie, I'm going to be very frank about that.”

A TransAlta spokesperson said Parkeston was fully operational within 30 minutes of the blackout to power KCGM’s gold operations.

“The station was fully available and ready to support Kalgoorlie and the Goldfields early on Friday morning and power flow commenced that afternoon when requested by the (Australian Energy Market Operator),” they said.

“The AEMO is continuing to call on Parkeston, and we are extremely pleased to keep the power station available to support restoration efforts in the region during this difficult period.”

The spokesperson said Parkeston had staff on site and was kept in an operational state.

Parkeston and West Kalgoorlie were both supplying power to Kalgoorlie-Boulder by Friday.

Synergy said it was keeping experts in town until the damaged power line was reinstated.

In November last year, maintenance was undertaken on the back-up generator to improve its reliability.

The contract

In 2018, Synergy won a $9.8 million, five-year network control services contract with Western Power to provide backup power to the eastern Goldfields under a deal supposed to “ensure essential service loads and most small use customers in the Eastern Goldfields will continue to receive an electricity supply when there is an outage.”

Documents filed with the Economic Regulation Authority stipulated Synergy’s West Kalgoorlie gas turbines should be able to reach full speed within 15 minutes of AEMO ordering a black start: firing up with no reliance on external electric power.

They also suggest the state government knew at least one of Synergy’s two generators needed a minimum power load to prevent tripping.

As part of the decision to pursue a network control services contract with Synergy, Western Power first decided against costing the installation of a battery, deeming it too expensive based on interstate examples.

Western Power described the “prudent and efficient” deal as the “only viable solution” due to time constraints, noting a battery would take three years to build.

That same year, 2018, was supposed to mark the end of the line for Synergy’s Kalgoorlie turbines as it worked to meet a state government direction to reduce its non-renewables generation cap in a move designed to encourage more private sector involvement in WA’s energy market.

Former Synergy chief executive Jason Waters in 2017 said the retirement of the turbines would not compromise energy security.

“Significant levels of reserve capacity will remain in the market and Synergy has worked closely with Western Power in determining our planned retirement schedule to ensure network security issues are considered,” he said.

But AEMO’s concerns the closure could lead to blackouts in Kalgoorlie led to the decision being reversed, much to the chagrin of private operators seeking to muscle in on Synergy’s market dominance.

Western Power in 2019 said “no viable proposals were received” from two attempts to engage the private sector.

Parkeston’s history

Parkeston was switched on in 1996 and is due for contract renewal in 2026.

It is one of four WA plants operated by TransAlta, which also owns a 150MW South Hedland facility, 245MW South Hedland plant, 48MW solar plant in the Goldfields, and is part owner of the Fortescue River Gas Pipeline.

A further 373MW worth of projects are at various stages of development by TransAlta in WA.

Northern Star acquired its 50 per cent stake in Goldfields Power after buying Newmont Corporation’s power business in 2021 under an option in the $1.17 billion KCGM acquisition one year prior.

At the time of purchase Northern Star noted Parkeston’s importance to energy security for Super Pit operator KCGM and renewable energy potential.

While being hailed by government now, it was a different story in 2004 when the plant could not feed into the main grid due to unsuitable transmission lines.

A 2004 story by Energy News Bulletin suggested Western Power and Newmont Australia were butting heads at the time over several issues.

The state utility provider eventually agreed to fund a $7 million upgrade for Parkeston to feed into the grid.

Parkeston was assigned about 60MW of capacity credits under the reserve capacity mechanism to supply the South West Interconnected System for the 2023-24 financial year, according to AEMO.

The plant is understood to have about 60MW of spare capacity, almost matching the capacity of Synergy’s turbines.

History of outages

Last week was far from the first time WA’s gold heartland has been plunged into darkness.

In 2017, lightning hit the same transmission line running between Merredin and Kalgoorlie, destroying one pole and damaging another.

In that case, power was cut to 20,000 residents for five hours because the generator was turned off, according to reports at the time, leading former Kalgoorlie-Boulder mayor John Bowler to take aim at Western Power.

 “Clearly, there is a problem with planning and with their backup service when we are so far away from our prime source of energy,” he said.

“Particularly when you’ve got a backup source there, you’d expect it to trigger almost immediately.

“I recognise that it is just an act of nature, lightning, but they should be planning for that eventuality.”

In 2019, after Synergy’s turbines were saved from the scrap heap, a Western Power spokeswoman backed their effectiveness while defending the cost to operate compared to upgrading transmission lines.

“In the event of an unplanned outage such as lightning strikes, the West Kalgoorlie and Mungarra generators keep power on,” she said.

That statement was once again tested in 2022 when Kalgoorlie was hit with three power outages in 10 days due to a heatwave and fire.

Calls for an investigation into how Western Power was managing back-up power in the town grew in the wake of those outages but were not heeded.

Last week’s mass outage – yet to be fully resolved – was caused by lightning destroying five power poles on the Merredin to Kalgoorlie transmission line.