Two senior executives from the state government owned CS Energy have left the company – with immediate effect – just days after the new LNP government announced a surprise life extension for the ageing Callide coal fired power generator, and after news of a new “explosion” at one of its units.
The top-down decision by the LNP government to extend the life of Callide B has descended into high farce, with one new report underlining the sheer folly of forcing what is regarded as one of the state’s most unreliable generators to stay open, and the state government now trying to find scapegoats to cover its embarrassment.
The state government on Sunday announced that CS Energy chief executive Darren Busine had left the business with immediate effect. He had already tendered his resignation – on April 3 – likely soon after the state government advised CS Energy of the plant extension, and publicly announced his resignation on April 8.
But in a surprise move on Sunday, the state government said that rather than leave in early May, as originally announced, Busine had been asked to leave the company immediately. The general manager of Callide, Mick Hill, was also asked to go.
CS Energy announced on Monday that the head of customer and growth Emma Roberts would act as interim CEO, but it was still scrambling to find a replacement for Hill.
When Busine’s departure was first announced last week, he was praised by his board for his work in diversifying the company’s operations into “renewables, energy storage and gas-fired generation.” That, however, is clearly not the way the new LNP state government wants to proceed.
The state government has announced it will rip up the state’s renewable energy targets – 50 per cent in 2030 and 80 per cent in 2035. Last week it announced it would extend the life of the ageing Callide B coal units from 2028 to either 2030 or 2031.
Days later it emerged that the troubled sister plant at Callide C had suffered another serious “explosion” that will take one of its units offline for at least two months. This is the same facility that suffered a catastrophic explosion in May, 2021 that took the C4 units offline for three years.
The C3 unit was also offline for 18 months because of defects in its cooling tower, and will now be offline again while repairs are made to the latest incident. The government sought to justify the immediate removal of the senior executives by saying it wasn’t properly informed of the seriousness of the incident.
But there is a running joke in the Queensland energy industry that the explosion(s) occurred in the wrong generation units.
Callide B, is the oldest and most unreliable of the two facilities, and keeping it open is estimated to cost around $400 million a year, and is considered pointless because of the growth of bulk renewables and battery storage in the state. It will likely need a new or expanded ash dam.
Stephanie Bashir, from Nexa Advisory, says the issues with Callide B go back to 2012, when it was regularly forced offline because of a coal supply dispute with Anglo American.
In 2024, its “capacity factor” wallowed at just 56 per cent, meaning it was either switched off or working well below capacity for much of the time. It is regarded as one of the least flexible coal generators in the Queensland fleet, ill-equipped to cope with the growing amounts of rooftop solar installed on homes and businesses.
“Since 2020, average total downtime has remained at around 4,000 hours,” Bashir writes in a new report. “This is the equivalent of each unit remaining offline for 12 weeks a year.”
The Australian Energy Market Operator has made it absolutely clear that the biggest threat to grid reliability is the performance of ageing coal fired generators, and particularly the number of unplanned outages. Bashir’s report highlights that unplanned outages are a major feature of Callide B’s downtime.
“For Australian electricity consumers, especially in Queensland, this unreliability is a supply risk and also flows through to higher bills via higher market volatility and contract prices,” Bashir writes. She also notes its inability to “ramp” and its high emissions.
“Closing Callide B and other coal-fired power stations across Queensland on time is critical to meeting the state’s emission reduction target – supporting a Climate Positive 2032 Olympic Games – and providing investment certainty for the renewable replacement capacity,” she writes.
The farcical scenes of a state government interfering in the business plans of a state owned company, and forcing it to return to a century old technology rather than accelerate its transition to the new, could be a blueprint for what could follow in the federal arena should the LNP-dominated federal Coalition win the national poll on May 3.
The federal Coalition has also promised to extend the life of coal and gas generators, burn more fossil fuels, and rip up contracts for wind and solar projects and new transmission should it be elected – all in the hope that large nuclear power plants or small modular reactors can be built in Australia.
Meanwhile, it will be interesting to see who the government, or the CS Energy board, finds to replace Busine. The role has been something of a poisoned chalice, with the previous CEO Andrew Bills leaving in early 2023 after falling out with his mountain bike buddy and then energy minister Mick de Brenni over the response to the first Callide C explosion.
See also: Ageing coal plants will be unavailable to supply power 34 pct of the time, new data suggests
Coalition’s coal agenda will be the cause of the blackouts they wish on renewables
