Will Origin Energys Decision to Keep Eraring Running Until 2029 Change Australias Energy Future?

Source: Kapitales Research

Highlights:

• Origin Energy Limited (ASX: ORG) said it will keep Australia’s largest coal-fired power station, Eraring, operating until 2029, at the time of writing, pushing back its earlier closure plan.
• The company cited delays in building renewable energy, battery storage and transmission infrastructure in NSW as the key reason for extending the plant’s life.
• Shares rose about 0.5 per cent following the announcement, as investors welcomed improved power-supply certainty during the energy transition.

Coal Power Gets a Reprieve as Market Balances Transition Needs

Origin Energy Limited (ASX: ORG) has surprised markets by announcing it will keep Australia’s largest coal-fired power plant, the Eraring Power Station, operating until April 2029, at the time of writing, instead of retiring it in 2027 as previously planned. The company’s shares ticked up around 0.5 per cent on the news, reflecting investor relief at reduced supply risk amid a challenging energy transition.

Located in New South Wales and capable of producing nearly 2,880 MW of electricity, Eraring plays a pivotal role in keeping the lights on for millions of Australians. Origin’s move follows warnings from the Australian Energy Market Operator (AEMO) that the grid may face reliability issues if the plant were to shut down before sufficient renewable, storage and transmission capacity comes online.

Why the Closure Date Has Shifted

Origin’s chief executive, Frank Calabria, said the extension gives more time for new renewable energy, battery storage, and transmission infrastructure to be built — critical elements for a stable, low-emissions electricity system. The decision reflects ongoing uncertainty about how quickly these projects can be delivered while ensuring reliable power supply across NSW. Although investors reacted positively, the delay highlights broader tensions in Australia’s energy transition: balancing decarbonisation goals with the practical need to maintain grid stability and avoid blackouts. Despite the extension, Origin maintains it is committed to its long-term climate targets and will not undertake major overhauls at Eraring before retirement.

Industry and Policy Implications

Energy analysts say this extension underscores the challenges renewable projects face, particularly around transmission bottlenecks and storage deployment. For policymakers, the decision could prompt renewed focus on expediting renewable infrastructure and enhancing coordination across government and industry to ensure smooth progression toward cleaner energy. At the same time, environmental groups argue that prolonging coal use delays emissions reductions and could make Australia’s climate targets harder to hit, setting up a debate over the pace and strategy of the nation’s energy transition.

As 2029 approaches, the Eraring extension will remain a key reference point for discussions on energy security, investment priorities, and the complex trade-offs of shifting to a low-carbon power system.

Disclaimer for Kapitales Research

The materials provided by Kapitales Research, including articles, news, data, reports, opinions, images, charts, and videos ("Content"), are intended for personal, non-commercial use only. The primary goal of this Content is to educate and inform readers. This Content is not meant to offer financial advice, nor does it include any recommendation or opinion that should be relied upon for making financial decisions. Certain Content on this platform may be sponsored or unsponsored, but it does not serve as a solicitation or endorsement to buy, sell, or hold any securities, nor does it encourage any specific investment activities. Kapitales Research is not authorized to provide investment advice, and we strongly advise users to seek guidance from a qualified financial professional, such as a financial advisor or stockbroker, before making any investment choices. Kapitales Research disclaims all liability for any direct, indirect, incidental, or consequential damages arising from the use of the Content, which is provided without any warranties. The opinions expressed by contributors or guests are their own and do not necessarily reflect the views of Kapitales Research. Media such as images or music used on this platform are either owned by Kapitales Research, sourced through paid subscriptions, or believed to be in the public domain. We have made reasonable efforts to credit sources where appropriate. Kapitales Research does not claim ownership of any third-party media unless explicitly stated otherwise.

Customer Notice:

Nextgen Global Services Pty Ltd trading as Kapitales Research (ABN 89 652 632 561) is a Corporate Authorised Representative (CAR No. 1293674) of Enva Australia Pty Ltd (AFSL 424494). The information contained in this website is general information only. Any advice is general advice only. No consideration has been given or will be given to the individual investment objectives, financial situation or needs of any particular person. The decision to invest or trade and the method selected is a personal decision and involves an inherent level of risk, and you must undertake your own investigations and obtain your own advice regarding the suitability of this product for your circumstances. Please be aware that all trading activity is subject to both profit & loss and may not be suitable for you. The past performance of this product is not and should not be taken as an indication of future performance.

Kapitales Research, Level 13, Suite 1A, 465 Victoria Ave, Chatswood, NSW 2067, Australia | 1800 005 780 | info@kapitales.com.au