Australia’s newest coal plant, Bluewaters stripping fortunes amid rapid rise of renewable energy

In 2009, Western Australia coal magnate Rick Stowe was apparently another winner.

Having made his fortune prospecting for black fuel at Coulee, 180 kilometers south of Perth, Mr. Stowe was heading downstream.

He was building his own power plant – a 440-megawatt plant that takes coal from the mine he controls before burning it to produce electricity.

The Last Coal - Rick Stowe
Rick Stowe, coal magnate in Western Australia, right.(Supplied: Alchetron)

It sounds like a recipe for printing money, said Peter Kerr, a former financial journalist and energy industry executive.

“It was actually a good time — a boom time, if you like — for coal,” Kerr said.

“The future looked bright. There was a lot of money for new developments and there wasn’t a lot of competition at the time from renewable energy.

And Rick Stowe was throwing everything he could to get this plant online.

“He was paying big bonuses to get employees to work longer hours, and he flew in Jimmy Barnes to get a big thank you party.

“On the surface, everything looked amazing.”

Subsurface problems

Less than a year after the Bluewaters power plant became operational, powerful investors pulled the plug on Stowe’s business empire.

Stowe’s downfall was in some ways an unsettling metaphor for Bluewaters itself.

man in plaid jacket
Kerr says the risks of the energy transition are enormous.(ABC News: West Mathewson)

Kerr, who now runs energy consultancy ATA Consulting, said circumstances conspired to bring Bluewaters down, culminating in the decision of its Japanese owners — Sumitomo and Kansai Electric — to write off their investments in 2020.

He said of the Japanese’s 2011 deal to buy power: “They would have invested, according to some estimates, half a billion dollars of their own money… in a $1.2 billion deal to buy this plant – the rest being financed through debt.” Station.

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