Australia’s Coal-fired Power Plants Outdated, Says New Research

Australia’s coal-fired power stations are outdated, unreliable and must be replaced soon, with over 60% of generating capacity more than 40 years old and prone to breaking down when the country needed power the most.

A new research from the UK-based consultancy firm Baringa entitled “Lights Out: Ageing Coal and Summer Blackouts” and commissioned by Climate Council, Australia’s leading community-funded climate change communications organisation, highlighted the need for more renewable power backed by storage like big batteries and hydro to replace these ageing coal clunkers and secure Australia’s energy future.

The report, which was released on Thursday, said that a coal generator’s availability to produce electricity begins to decline from 40 years old, decreasing from 81% to 65% on average and over the past four years, coal power has been significantly less available during periods of increased power outage risk than under typical conditions.

The majority of recent power outage risk conditions have occurred in New South Wales and Queensland, the states most dependent on coal generators. Coal outages have played the largest role in power outage risk conditions in New South Wales and Victoria, the states with the oldest coal generators.

During summer (November to March), hot weather and unplanned coal outages are key drivers of power outage risk and four of the most severe price spikes in the past seven years were driven by unplanned coal outages, the report said.

“Batteries have already taken over from coal as the primary source of ‘frequency services,’ a rapid injection or reduction of electricity into the grid to balance supply and demand,” the report noted.

Unreliable Power Source

Climate Councillor and energy expert Greg Bourne said that clapped-out coal clunkers are making it harder to keep the lights on. A coal generator’s availability to produce electricity begins to decline from 40 years old, decreasing from 81% to 65% on average.

According to Greg, more than half of Australia’s coal fleet was built in the 1980s. As they age, their reliability drops dramatically. In states like New South Wales and Victoria, where coal stations are the oldest, the risks are particularly acute.

Progress on Clean Power Delayed

Climate Council CEO Amanda McKenzie said that Australia’s reliance on coal was delaying progress on reliable, clean power.

Coal-fired power stations are Australia’s biggest energy liability—polluting, unreliable, and fuelling unnatural disasters like bushfires and heatwaves. The writing is on the wall for coal: it’s on the way out, and there need to be replaced it fast with renewables backed by storage—for future generation and a safer climate, she said.

“Batteries have already proven their worth, stepping in to keep the lights on during critical moments. During NSW’s November 2024 heatwaves, when coal outages left the grid exposed, batteries delivered up to 200 MW of electricity—enough to power over 150,000 reverse cycle air conditioners,” McKenzie added.

Peter Sherry, Partner at Baringa Partners, said that their analysis found coal generators in the National Electricity Market were becoming less available with age, particularly beyond 40 years of age.

“The majority of our coal capacity is already over 40 years, and as these generators continue to age we would expect their availability to decline. Given asset age, as well as continued declines in technology costs, our projections indicate that most of Australia’s coal generation will be replaced by renewables and firm technologies like storage within the next ten years,” Sherry added.