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Latrobe Valley a litmus test for clean energy transition

  • 09 November 2016


Everyone knew that the coal-fired power industry was on its way out of the Latrobe Valley, it was just a question of when.

That came to a head last Thursday, when French company ENGIE, who own the Hazelwood power station in Morwell and the adjacent coal mine, announced it would close by the end of March next year.

Most of the 750 people employed at the station will lose their jobs, though 250 workers will stay on for five years to manage the rehabilitation of the mine.

The death-knell was sounding for Hazelwood long before ENGIE's announced company-wide move away from coal earlier this year. The 50 year old power plant is one of the country's oldest and most inefficient, making it extremely vulnerable to the lower electricity price and supply surplus that appears to have tipped it over the edge.

As the most polluting power plant per unit of energy produced in the industrialised world, according to a World Wildlife Fund report, many will be glad to see the power station go. But its closure also flags a rising dilemma, over who bears the cost of the transition to clean energy. 

The Latrobe Valley has long been reliant on the coal industry and, given that it already has the state's highest unemployment rate of 8 per cent, some are concerned of a looming social collapse. The jobs lost due to these closures shatter the confidence of locals, who see their town heading in only one direction.

On Thursday, Victorian Premier Daniel Andrews announced a generous support package aimed at encouraging business to move into the area and a hub for the community to develop transition proposals. Announcements also came from ENGIE and the federal government.

But Friday a war of words erupted when Environment Minister Josh Frydenberg said Engie was 'driven out of town' by the state government's renewable energy goals. Furthermore there are concerns that the state government packages have come too late to avoid a hard landing and a loss of confidence in the Valley's economy.


"Australia's energy transition can either focus on bringing everyone along with it or it can leave behind communities doomed to a fate similar to the rust belt in the US."


Wendy Farmer from Voices of the Valley, the group which rose out of community anger at the handling of the 2014 Hazelwood mine fire, queries why Andrews waited until the Hazlewood closed. 'These transition plans should have been started in May ... if not