Mon, Jul 23, 2018 - Page 7 News List

South Australian city shows there is life after coal

Port Augusta was a coal town that many predicted would be wiped out by the closure of two aging power plants, but instead it has more than a dozen renewable projects in the works

By Adam Morton  /  The Guardian

Illustration: Yusha

The largest solar farm in the southern hemisphere lies on arid land at the foot of the Flinders Ranges, more than 300km north of Adelaide, South Australia. If that sounds remote, it does not do justice to how removed local residents feel from what currently qualifies as debate in Canberra.

As government lawmakers and national newspapers thundered over whether taxpayers should underwrite new coal-fired power, mauling advice from government agencies as they went, residents of South Australia’s Upper Spencer Gulf region have been left to ponder why decisionmakers were not paying attention to what is happening in their backyard.

In the middle of 2016, the region was on the brink, hit by the closure and near collapse of coal and steel plants. Now it is on the cusp of a wave of construction that investors and community leaders say should place the region at the vanguard of green innovation — not just in Australia, but globally.

There has been an explosion in investment, with US$5 billion spread over the next five years. There are 13 projects in various stages of development, with more than 3,000 construction and 200 ongoing jobs. The economy of this once-deflated region has been transformed and those who live here are starting to feel hopeful again.

Port Augusta Mayor Sam Johnson, a 32-year-old former Liberal Party member, is continually surprised at how resistant some are to the idea that the energy environment has changed.

“You might choose to ignore what’s happening here now because we’re out of sight, out of mind, but the reality is that what’s happening here is going to be happening on the eastern seaboard in the next 10 years,” he said.

In simple terms, the Upper Spencer Gulf transition story goes like this.

Port Augusta was a coal town, home to the state’s only two lignite — or brown coal — plants, Playford B and Northern. Playford B, aging and failing, was mothballed in 2012. Northern, the larger and younger of the two, closed in May 2016 when owner Alinta Energy decided it was no longer economically viable.

The Leigh Creek mine that supplied it, by then offering up mostly low-quality coal, shut at the same time. About 400 workers at the plant and the mine lost their jobs. About one-third retired, one-third found other employment locally and one-third had to leave town to find work.

At the same time, further around the gulf, the steel town of Whyalla was teetering precipitously after the owner, Arrium, put the mill in voluntary administration facing debts of more than US$4 billion.

Yet as the doom hit, there were also rays of hope as several clean power projects were mooted for the surrounding area.

Two years on, the Port Augusta City Council lists 13 projects at varying stages of development. Whyalla has unearthed a potential savior in British billionaire industrialist Sanjeev Gupta, who not only bought the steelworks, but promised to expand it while also spending what will likely end up being US$1.5 billion in solar, hydro and batteries to make it viable.

Gupta said the logic behind his investment in solar and storage is simple: It is now cheaper than coal.

Johnson said he expects the Upper Gulf region to receive US$5 billion in clean energy investment over the next five years.

“My gut feel — and I’m an optimist — is that they will all go ahead,” he said. “They are different technologies and they are playing in different markets, so they are not competing for power purchase agreements.”

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