Rapid timeline to meet gas power need

New gas power generation could be needed to supply Perth as early as 2024, with a project at Coolimba one candidate.

Flexible gas capacity could be needed if a strengthening economy leads to strong demand growth, according to the state government’s recent Whole of System Plan.

That plan modelled a range of demand scenarios in the South West Interconnected System through to 2040

The gas would complement renewable generation such as solar and wind, which are intermittent in output.

And those renewables could be set for huge growth.

More than 5000MW of wind and solar capacity would be needed by 2030 in a high demand scenario.

Gas and batteries would be key to support that massive increase.

Flexible gas can quickly increase or reduce power production to firm up renewables, something larger coal power stations struggle to accommodate.

According to the plan’s modelling, new flexible gas would be used in 2024 to produce about 400 gigawatt hours of power.

It would rise to about 3000MWh in a decade.

The data shows about 230MW of new capacity could be needed by 2024 in a high demand scenario, with another 580MW needed the following year.

But in lower demand growth scenarios, minimal new gas capacity would be required.

So while there’s potential demand could be there soon, there’s also a risk a new project won’t be economic.

Synergy, the state government owned entity which has the largest share of the power market, has told Business News it does not have a further gas generation project in planning.

Energy Minister Bill Johnston said the private sector would need to take responsibility for any new gas capacity.

“The Whole of System Plan modelling reveals renewable generation is expected to triple by 2040, with a strong uptake in wind power,” Mr Johnston said. 

“Renewable energy sources, including the 300,000 households with rooftop solar, account for over 20 per cent of the annual electricity generated in our main electricity network. 

“Western Australia is embracing renewable generation, with one in three households having rooftop solar panels, this signifies that battery storage will play an important role in our future.

“The WOSP modelling’s scenarios test which investments can be made with ‘no regrets’.

“If any future gas-fired generation is required then the private sector will need to take the risk of these investments.”

Market diversity 

That opens the door for the private sector to take the lead.

But there’s a scarcity of gas projects in the pipeline.

There are about 25 gas or gas and distillate generators already operating in the SWIS, according to the Australian Energy Market Operator.

The main players include Alinta Energy, Synergy, Newgen, Perth Energy and Tesla Corporation (not the car maker). 

The gas units vary between peaking, flexible capacity switched on in periods of high demand; to a handful registered for baseload production.

Alinta Energy was open to a potential development, WA general manager Chris Campbell told Business News.

“We’re certainly willing to invest in increased generation capacity, including gas, batteries and renewables, to enable the ongoing decarbonisation of the energy system, should government provide the necessary signals,” Mr Campbell said.

“(That would be) announcements of a clear and accelerated retirement of coal generation.”

The two Muja C coal generating units will close in 2022 and 2024, with the Whole of System Plan implying neighbouring Muja D will continue operating for the foreseeable future.

One reasonably advanced gas power project is Coolimba power station, which was purchased from Aviva Corporation by Westgen in 2013.

That’s in the Midwest, with environmental approval already granted.

Westgen director Richard Harris said the Mid West was a good location for gas-fired power because it would balance wind generation in the area.

Coolimba was close to the new Bright Energy Investments Warradarge wind farm, he said.

But while it was probably new gas generation would be needed this decade, Mr Harris said it would be some time before the business case made sense.