Muswellbrook power station tour shows why AGL set 2022 deadline

LIDDELL power station’s turbine number two has been offline for two weeks with a case of the wobbles, and no one knows why.

“We’re struggling to find the problem. When we run that unit up it gets the wobbles. We’ve got a couple of hundred tonnes of machinery moving at 3000 revs per minute. You need everything to be running true,” said Liddell and Bayswater power station general manager Kate Coates on Tuesday.

Then there’s the leaking boiler tubes. Kilometres of them. And the deteriorating insulation on high voltage power circuits, and the old and unreliable ash disposal system, along with the coal conveyors that are under “severe corrosion attack” and kilometres of metal suffering the “creep” that comes after nearly five decades of expansion and contraction.

Liddell power station is “on a sliding scale to oblivion”, Ms Coates told the media after a tour of the plant on Tuesday, after weeks of public debate over owner AGL’s closure plan for 2022, and a Federal Government push for it to remain open.

"We have corrosion damage where we have the internals of the tubes corroding, we have external erosion. So we've got multiple fronts of challenge on this plant on a daily basis,” she said.

While AGL head Andy Vesey agreed to a request from Prime Minister Malcolm Turnbull to have the AGL board consider extending Liddell’s operation until at least 2027, Kate Coates was blunt when asked if it was a good idea.

“I think we can spend our resources and our people’s time better elsewhere,” she said.

Before AGL bought Liddell and Bayswater power station from the NSW Government in 2015 for $1.5 billion, with Liddell given a book value of $1, the company received an independent desktop assessment of the cost of keeping Liddell open until 2032. The figure came in at about $900 million.

Liddell’s an old lady and you can’t ask an old lady to run a marathon a few days in a row without her falling over.

Liddell power station general manager Kate Coates

Asked who should pay to keep Liddell running beyond 2022, after AGL has already spent $138 million on maintenance and repairs since 2015, Ms Coates was again blunt.

“I don’t think anyone should pay for it,” she said.

Although Liddell remained a “properly functioning power station”, it was not running at its originally rated 500 megawatts per turbine, but at 420 megawatts, and at a lowered pressure.

“Because it’s so old and we’ve got so many weak points, we’ve had to reduce the megawatt output and the boiler pressure.”

Liddell’s biggest challenge is maintaining energy supply during the hottest days of summer. Machinery failures on some of the hottest days in February left NSW close to the kind of statewide blackout that hit South Australia.

“Liddell’s an old lady and you can’t ask an old lady to run a marathon a few days in a row without her falling over,” Ms Coates said.

AGL chief economist Tim Nelson said Liddell’s age of 50 by 2022 meant it was one of the world’s oldest power stations, with only one per cent of the world’s power stations aged between 50 and 60 still operating.

Journalists were told AGL faces other issues in keeping Liddell and Bayswater providing power to NSW.

“We really struggle to get our coal over a very, very busy rail network. I think ongoing coal supply is going to be a major issue,” Ms Coates said.   

Mr Nelson stressed the need for the Federal Government to follow the recommendations of the Finkel report and set a clean energy target to put a price on carbon.

The government establishing clear policy guidelines would open up investment, the media was told.

“What I think is incumbent on us .. is to get on with not only the investment we’ve got underway, but to work with the government to demonstrate it’s not just about extra supply, but the right type of supply,” Mr Nelson said.

Supply had to be “flexible to meet those summer peaks when demand skyrockets as a result of very hot weather”, he said.

Mr Nelson said reports including a recent Australian Energy Market Operator report talked about the capacity required to meet demand, but also about declining energy consumption because of the uptake of issues like domestic rooftop solar panels.

“Coal-fired power stations are very good at being switched on and staying on, but we need growth in capacity, or maintaining capacity, with declining energy. Generally you’re much better off in that case with flexible plant such as hydro and open cycle gas turbines. I think that’s where we’re going.”


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