Australia’s Ageing Coal Fleet Poses Major Risk to Power Reliability

A new report from Reliability Watch has exposed the staggering unreliability of Australia’s ageing coal power stations. Between October and March, coal-fired units broke down 128 times—eight times more than what the Australian Energy Market Operator (AEMO) expected. On average, 5.1 GW of coal capacity was offline at any time, enough to power 1.2 million homes during peak demand.

The analysis revealed a strong link between coal plant failures and wholesale electricity price surges. AEMO and industry experts have long warned that these breakdowns are the biggest threat to grid reliability—not renewables, which are variable but predictable.

While critics call wind and solar “intermittent,” the report argues that coal is the real issue. Unlike renewables, which can be forecast, coal outages occur without warning. Battery storage and flexible loads are increasingly acting as shock absorbers, filling the gaps left by failing coal stations.

Dave Copeman of the Queensland Conservation Council stressed how coal’s instability is pushing up power costs. Market concentration allows big energy companies to exploit these breakdowns, legally raising prices when coal plants go offline.

Copeman and other environmental advocates are urging governments to accelerate the switch to renewable energy backed by storage. The federal government’s 82% renewables by 2030 target is a step forward, though it's facing pushback from conservative forces still clinging to coal.

Despite mounting evidence, the Queensland LNP government plans to extend the life of its state-owned coal stations. This includes potentially keeping Callide B open—even after an explosion at Callide C. Reliability Watch found Queensland’s coal plants to be the most unreliable, breaking down 78 times this summer alone.

In NSW, 35% of the coal fleet was offline in November—leading to the highest wholesale electricity prices on the grid. Coal operators had only forecast 17% of capacity to be down, but the reality more than doubled expectations.

Victoria’s Yallourn station is another example. One of its units failed three times in seven weeks before a scheduled maintenance that ran nearly 20 days over. This trend of coal unreliability is becoming more common as infrastructure ages.

The report states that unplanned breakdowns averaged 0.7 per day across the coal fleet, with 21 coal units offline for over 1,000 hours last summer. In both NSW and Queensland—states most reliant on coal—electricity prices were double or triple when coal availability dipped.

Battery storage proved more reliable than coal in NSW during November. High renewable energy generation consistently correlated with lower electricity prices. In contrast, coal’s unreliability is increasingly unsustainable.

A supporting report from Baringa found that 60% of coal capacity is over 40 years old, and availability drops from 81% to 65% after that point. During extreme power risk periods, coal availability has been 10–20% lower, particularly in NSW and Queensland.

Unplanned outages during hot months (Nov–March) were identified as major drivers of price spikes and blackout risks. Four of the most extreme price events in recent years were directly linked to coal failures, not renewables.

Today, batteries have overtaken coal as the grid’s most reliable source of “frequency services”—quick bursts of energy that balance supply and demand in real time. It’s a clear sign that the energy transition is not only necessary, but already underway.

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