What’s the deal? Synergy could turn to Bluewaters amid growing power gap

The clock is ticking on the State Government’s promise to freeze out private coal generator Bluewaters — but shadow energy minister Steve Thomas says the company should be given a fair go. The Government plans to stop buying power from Bluewaters — a baseload supplier producing about a sixth of the electricity on the main grid — when a contract expires in 2025. That’s alongside a broader scheme to shut down coal power stations owned by Government utility Synergy by the end of the decade. The closures are set to exacerbate a looming shortage in Western Australia, expected by the market operator to grow over the next 10 years. But there are signs the 2022 pledge may be in for a rethink. It’s believed Synergy and Bluewaters have been in early talks about a potential deal to extend power supply beyond next year. The State-owned business would not be drawn on those negotiations or questions about whether a process was under way to find replacement power. “In any commercial supply agreement details of the contract cannot be disclosed by either party,” a spokeswoman said when asked if the State was still planning to stop buying power from Bluewaters next year. Dr Thomas said Bluewaters should be allowed to tender in an open market. Synergy has huge market share in the local grid and is the biggest buyer of energy — and Dr Thomas warned Bluewaters would struggle to survive if it was prevented from bidding. “With the woes in the coalfields . . . (the Government’s) solution seems to be doing everybody out of business,” Dr Thomas told The West Australian. Bluewaters has already been under pressure after key supplier Griffin Coal hit the wall nearly two years ago and Premier Roger Cook has pledged about $260 million to keep the mine running until 2026. During a recent debate about Griffin’s State Agreement, Mr Cook told parliament the Government expected to be in a position in June 2026 to “anticipate a future without relying upon the Griffin Coal coal mine and the power generation assets associated with it”. He said the State would be underwriting contracts in the lead up to that date to ensure supply security. Dr Thomas told the Legislative Council debate about the bill that denying Bluewaters the chance to tender was a “dastardly act. . . (inflicted) upon the economy and the people of Collie”. “The flow-through damage will hit Griffin Coal mining, and suddenly the whole thing will implode,” he said. The Government used commercial in confidence as a shield to avoid questions on the topic in the Legislative Council in August. When asked whether Synergy would renew the contracts or was looking elsewhere, Parliamentary Secretary for Energy Darren West said deals with private generators were determined on a “portfolio-needs basis”. “The details of these agreements, including timing, are commercial in confidence,” he said. Bluewaters could not be reached for comment.