The $300m power station that’s now worth nothing
One of Queensland's newest power stations is now literally worthless.
Plummeting power prices, the influx of renewables and increasing operating costs have forced the State Government to write down the value of the Swanbank E power station to zero.
Over $1 billion was erased from the value of the Government's carbon-emitting electricity assets last year, raising questions about whether the generators would have to be fast-track their closure to prevent losses.
The $300 million gas-fired Swanbank E power station was only opened in 2002 as part of the then Labor government's policy to wean Queensland off coal-fired electricity.
The Ipswich-based station, which is now operated by the Government's new generation company CleanCo, was mothballed in 2014 after power demand plummeted and then restarted in 2018 to take advantage of higher power prices.
The write-off was revealed in a Queensland Audit Office report which warned declining profits across the publicly owned generation sector may force the Government to bring forward retirement plans.
The report found Stanwell slashed $720 million from its asset base while CS Energy cut $353 million, which led to profits declining by 88 per cent to $200 million across the sector.
Yet both state-owned companies still expect their power plants to remain profitable over the next 26 years, with the final coal-fired station scheduled to close in 2045.
"Despite this, CleanCo reduced the value of its Swanbank E gas power station to zero," the report said.
"Due to declining electricity prices, forecast revenues will not be sufficient to cover the increasing costs to operate the power station.
"CleanCo expects to earn net losses from running this power station until its expected retirement in 2036."
However Energy Minister Mick de Brenni said Queensland would need more generation capacity to meet its growth aspirations, not less.
"Let me make it clear, there are no plans to decommission any generation assets in Queensland ahead of their time," he said.
But Solar Citizens spokeswoman Stephanie Gray said it was absurd that the Queensland Government still believed it could run unprofitable plants till the end of their technical lives.
"Taxpayers will be funding polluting coal stations to stay online decades after they're profitable," she said.
Originally published as The $300m power station that's now worth nothing