The woes at Callide Power Station continue to deepen and have claimed yet another casualty.

Sources indicate that on 4 April, a significant clinker (a mass of hardened ash) detached from the boiler wall in the C3 unit. While clinker formation is not unusual in coal fired power stations, routine maintenance typically addresses such issues during outages. It appears that this clinker broke away during the unit’s operation, causing the ash conveyor water system to release high pressure steam into the boiler.

It has also been reported that the steam from the ash conveyor water system subsequently extinguished the fires in all four mills, which process coal into pulverised fuel (PF) to fire the boilers. As a result, the boiler flames in the four mills were snuffed out, and the unit experienced a pressure fluctuation as it drew in unburned fuel and air. This fluctuation allegedly led to an explosion that caused extensive damage to the unit and its boiler.

Fortunately, no workers were in the vicinity at the time. However, significant repair work is now required, including in the hard-to-reach upper sections of the boiler, where extensive cladding and lagging repairs must be undertaken.

The political fallout continues to swirl. CS Energy CEO Darren Busine has already tendered his resignation, which has now been made immediate. There is also speculation that the General Manager of Callide Power Station has offered their immediate resignation.

Concerns have arisen around the LNP Queensland Government, specifically regarding what David Janetzki knew and when he knew it, particularly given his 8 April address to the Queensland Energy Club. In that speech, he announced coal and Callide would continue to play an ongoing role in Queensland’s energy mix beyond Callide B’s expected 2028 closure (at least another three years) with no mention of the recent explosion or the seriousness of the incident.

This event evokes memories of the Callide C4 explosion in May 2021, whose outcomes were finalised in February 2025 when the Australian Energy Regulator (AER) imposed a $9 million fine plus court costs on the joint venture for the Callide C4 unit. The fine, just shy of the maximum $10 million possible, was the highest ever imposed for failure to comply with performance standards under the National Electricity Rules (NER). The retailer was found to have breached the NER by failing to meet its own performance standards, and investigations revealed that there was insufficient energy supply to safely disconnect the generating unit when the explosion occurred. Furthermore, the protection systems intended to override the connections were found to be inadequate.

The incident report also noted that, two minutes after staff evacuated due to a fire, a two-tonne rotor shaft piece was thrown five metres across the turbine hall floor, while a 300kg piece of equipment was hurled 20 metres into the air, breaking through the hall’s roof.

On December 12th, the AEMC released a request for stakeholder input as it commenced its System Restart panel review.

The panel are looking to review the challenges, especially around:

• The increasing reliance on the lowered availability of System Restart Ancillary Services (SRAS) and scarcity of that capability from new transmission-connected generators.
• The rising system restoration risks are coming about within areas of large penetration of distribution-connected PV generation.

The framework is being assessed in two stages: the first comprises a review to assess whether the current regulatory framework suits the evolving nature of the grid under the AEMO ISP, and the second revises the requirements around system restarts based on the first stage findings, considering the risks associated with major supply disruption risks and SRAR availability and costs.

In the event of a significant loss of generation and supply to consumer load, the current arrangements allow for invoking the SRAS procedures known as black start capability. This capability is usually made up of smaller, quick-to-start, smaller-generation units that can assist historically large baseload units in coming online.

Overall, the absence of this generation would primarily become problematic during a large-scale system failure, similar to the issues experienced with Callide. However, as we transition to a grid with more variable generation and fewer synchronous units, such disturbances could become more frequent. This trend may persist until sufficient storage capacity is available to stabilise the system.

Submissions close on 30/01/25, and it is likely that a significant number of differing opinions will emerge as businesses advocate for ensuring payments are available for these events. This could also strengthen the arguments being presented, following the ESB Post 25 assessment, for the introduction of a capacity mechanism for generators on the NEM.

At Mount Piper Power Station, a coal power station near Lithgow in NSW, operators work to minimise financial losses by reducing the units minimum operational load at which the units can stay online, as electricity prices plummet into negative territory during solar hours, driven by an influx of solar generation flooding the grid. They focus on positioning the station to capitalise on the expected price spike later in the day, as solar generation declines and supply tightens, leading to higher prices.

The plant, which has a total capacity of 1430 MW, can still operate a little over 10% capacity. While it was initially able to ramp down to only 320 MW, its minimum operating level was reduced to 150 MW in July 2023. This approach enables the unit to operate at a reduced load during the day – despite incurring losses, before ramping up production during the evening peak to offset earlier deficits and achieve profitability. “It’s a balancing act – how hard do they need us to get out of the way [of cheap renewable energy] versus how hard do they need us in the evening,” said Steve Marshall, Head of Mount Piper for EnergyAustralia.

With a capacity of 1430 MW, the power station’s two turbines supply about 10% of NSW’s maximum demand.

Mount Piper was instrumental during two significant grid events throughout 2024: the pre-summer heatwave in late November and the administered pricing event in May, where blackouts were narrowly averted. During these critical periods, the station operated at full capacity. Without Mount Piper’s contribution, load shedding in parts of NSW would likely have been inevitable.

Mount Piper has proven to be a reliable and critical unit in the state, experiencing minimal unplanned outages or trips compared to other units in the NEM.

Mount Piper Power Station has also explored ways to better manage the impact of solar carveouts, trialling a process called ‘two-shifting.’ This involves taking one steam turbine off the grid for up to 12 hours while keeping the boiler warm and ready for a quick restart. This approach has been adopted in other regions, such as the United Kingdom and United States, where plants have adapted to different daily cycles. However, operating the units in this manner is expensive, as they require upgrades and/or increased maintenance.

Several coal units across the NEM have struck agreements with the government to ensure supply capacity remains available until their planned exit from the grid.

• Yallourn Generator (VIC): Secured by a 2021 agreement with the state government, ensuring 1480MW capacity until mid-2028.
• Loy Yang A Generator (VIC): Similar agreement extending operation until 2035.

• Eraring Plant (NSW): Agreement with NSW government extends operation to August 2027, adding two more years, with the option for a further two years without subsidies at this stage.

Mount Piper Power Station plans to play a “reserve” role, functioning as a firming unit that runs only when necessary to fill gaps in wind and solar generation. For several years, the station has participated in discussions with the NSW government about a potential industry-wide coal closure plan. A bill to establish a framework for the “orderly exit management” of coal power plants was passed by South Australian parliament on Wednesday, 27 November 2024, though the rules are still being finalised.

Mount Piper’s low minimum running output and two-shifting capability position the station as a valuable asset in the energy transition. However, maintaining the flexibility comes at a considerable cost. A major maintenance overhaul, scheduled to commence in April 2025, will require an investment of $160 million. During this period, Unit 1 will be offline from April 1 to May 26, and Unit 2 from April 6 to April 27, resulting in a 21-day overlap when both units will be out of service.

Edge2020 anticipates Mount Piper Power Station to play an increasingly crucial role in the transition as new clean generation and transmission projects come online. Given the station’s growing financial challenges amid negative prices, volatile market demand, and stricter environmental and regulatory requirements, this shift will require significant policy support by government.