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Australian state seeks to stop huge power supply loss on May 15

Published 04/05/2017, 04:56 pm
Updated 04/05/2017, 05:00 pm
© Reuters.  Australian state seeks to stop huge power supply loss on May 15
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MELBOURNE, May 4 (Reuters) - The Australian state of Victoria is seeking to avert the loss of a third of its power supply on May 15, by blocking workers from taking industrial action at the state's largest power plant and coal mine.

Victoria's industrial relations minister Natalie Hutchins asked the Fair Work Commission to prevent the Electrical Trades Union from going ahead with work stoppages on May 15 at the Loy Yang A power station, owned by AGL Energy AGL.AX .

Power supply from Victoria is crucial as back-up for the state of South Australia, which gets more than 40 percent of its power from intermittent wind and solar energy and has suffered a number of outages over the past year.

Power problems have become a hot political potato in Australia as prices have soared and outages have become more frequent, leading manufacturers and smelters, like Rio Tinto RIO.AX RIO.L and Alcoa (NYSE:AA) AA.N , to threaten to shut operations and slash jobs.

AGL said on Thursday it would have to shut its Loy Yang A coal-fired plant and mine due to the planned work stoppages, which stem from a two-year wage fight.

Output from the neighbouring Loy Yang B power station, run by France's Engie SA ENGIE.PA , is also at stake as it is fed by AGL's mine.

"As a consequence of the proposed action, AGL Loy Yang will not be able to continue operations," AGL Loy Yang general manager Steve Rieniets said in a statement.

The 2,180 megawatt Loy Yang A plant and 1,000 MW Loy Yang B plant together make up 32 percent of Victoria's power capacity, according to the Australian Energy Market Operator's (AEMO) web site.

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