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| The Hazlewood power plant is to be closed down. Photo: Eddie Jim |
Engie, the majority owner of the plant, has also told workers that 230 jobs will be needed on site to 2017 and 2018.
Beyond that, some workers will be required on site for a few more years.
It is understood that workers have also been assured that their entitlements will be guaranteed under the enterprise bargaining agreement.
The company is also offering workers skills training and counselling to help them with their transition.
It's understood that management have also told workers that Hazelwood is not a viable business to sell.
In a briefing that began at about 10am, workers were also told that Engie would spend more money on its other power station in the Latrobe Valley, Loy Yang B, near Traralgon.
Engie's Australian chief executive Alex Keisser said the 1600 megawatt Hazelwood power station had been operating in a "difficult national energy market environment for a considerable period".
"Hazelwood is now more than 50 years old. It has been a wonderful contributor to the National Electricity Market but we have now reached the point where it is no longer economic to operate," Mr Keisser said.
Mr Keisser said Engie would need to invest "many hundreds of millions of dollars" to keep it viable and, most importantly, safe to operate.
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| A worker entering the Hazelwood plant on Thursday morning. Photo: Eddie Jim |
"None of these options has proven to be economically viable and as a result, the extremely difficult decision has now been taken to close all eight generating units by 31 March next year."
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| Some workers have been seen boarding buses. Photo: Eddie Jim |
Federal environment and energy minister Josh Frydenberg is also set to hold a press conference at 12.15 to discuss the plant's future and federal support for the valley.
The Prime Minister has pledged to work with the Victorian government to support workers who've lost their jobs.
"This is a very, very tough time for the valley," Malcolm Turnbull told reporters in Sydney.
The Prime Minister said the federal government had established a ministerial task group "to provide the support the community needs to ensure there are jobs and opportunities".
The federal government would work with the state government in a "collaborative way", Mr Turnbull said.
"Our thoughts today are with the tough times for the men and women who work at Hazelwood and of course the many others in that community whose jobs depend on that power station."
Left in the lurch
The Hazelwood closure marks a historic shift away from the state's reliance on burning brown coal for electricity.
CFMEU Victoria mining and energy president Trevor Williams said Hazelwood workers "would be devastated, although some of us have seen this coming for quite some time".
Speaking outside the Hazelwood power station in Morwell, Mr Williams said the closure was "another kick in the guts for the Latrobe Valley".
He said the union wanted a staged closure to ease the impact on the 1000 workers at the power station and mine and on the local community.
"It would be fair to say that some of the workers there would think that they've been left in the lurch, and also the Latrobe Valley community," he said.
"My understanding is it's going to be a total closure of the station and mine, which is something that we don't support.
"Although we'd like to see Hazelwood continue to run, if it needs to be closed we believe it should be done in a phased out way, which would give us an opportunity to make arrangements for the workers in the plant to be redeployed to other power stations in the Latrobe Valley," he said.
"Some of the people who work there have not worked anywhere else."
Before news emerged of the closure Wendy Farmer, from community group Voices for the Valley, said it was a day of mixed feelings for herself and the community.
"The community have known for the last 10-20 years that this day would happen, we've just never known when. The last six months has really been a time of being left in limbo," she said.
As revealed by Fairfax Media, the plant owners, Engie and Japanese company Mitsui, are expected to shut the plant completely in less than five months.
Ageing equipment
Built between 1964 and 1971, Hazelwood produces up to a quarter of Victoria's electricity when operating at full capacity and is responsible for 3 per cent of national greenhouse gas emissions.
The closure has been driven by a strategic decision from the Paris-headquartered Engie, which owns a 72 per cent stake in the plant, to move away from coal as an energy source.
It also follows the plant being saddled with at least four repair notices from WorkSafe Victoria for ageing equipment. It is understood the repairs would require millions of dollars of investment to modernise the station.
It is not expected to threaten the state's power supply due to a surplus of generation capacity in Victoria, but its removal will increase the wholesale price of electricity.
An analysis commissioned by the Andrews government estimated the rise could be between 4 and 8 per cent.
The Latrobe Valley is one of the most disadvantaged parts of Victoria, having struggled to recover since losing about 15,000 jobs when the electricity system was privatised in the 1990s.
Unemployment is as high as 19.7 per cent in Morwell and 14.6 per cent in Moe.
Mr Frydenberg and Victorian Treasurer Tim Pallas have both recently met with senior Engie executives in Paris.
In a meeting with Engie chief executive Isabelle Kocher last week, Mr Frydenberg emphasised the company's obligations to its workers.
Hazelwood mine area overlaid on Melbourne CBD
The state government announced this week that Mr Andrews would personally oversee a taskforce to attract new businesses to the Latrobe Valley and encourage existing businesses to expand.
It follows a pledge of $40 million in the state budget to help the valley cope should coal plants close.
Hazelwood is one of four large coal plants that for decades has provided the overwhelming bulk of Victoria's electricity, and been fed to other states through the national grid.
The remaining three plants – Yallourn, Loy Yang A and Loy Yang B – continue to operate, though Loy Yang A is subject to industrial action that its owner, AGL, has warned could force it offline.
Hazelwood is one of four large coal plants that for decades has provided the overwhelming bulk of Victoria's electricity, and been fed to other states through the national grid.
The remaining three plants – Yallourn, Loy Yang A and Loy Yang B – continue to operate, though Loy Yang A is subject to industrial action that its owner, AGL, has warned could force it offline.
Links
- What will Hazelwood's closure mean?
- Electricity bills up 4 to 8 per cent due to Hazelwood shutting
- Brown and out: 900 jobs to go, with Hazelwood switch-off plan due in days
- Hazelwood facing WorkSafe notices amid expectations of closure
- Premier leads Latrobe Valley taskforce as Hazelwood announcement looms
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