Water Week

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Bell Bay power station in Tas: delivered gas costs estimated at $4.30/GJ; transmission at $1.12/GJ

Posted by waterweek on 20 September 2007

The Bell Bay power station on Tasmania’s north coast commenced operations in 1971 with a 120MW unit and a further 120MW unit was added in 1974, noted ‘Fuel resource, new entry and generation costs in the NEM’, a report by ACIL Tasman for NEMMCO (27/3/2007).

Background to station: The station’s original role was to provide backup for the Tasmanian hydro system during periods of sustained drought and ran on imported fuel oil. With the construction of the Tasmania Gas Pipeline (TGP) from Victoria, the Bell Bay station was converted to run on gas. The conversion of unit 1 was completed in March 2003, followed by unit 2 in October of that year. The pipeline had significant spare capacity and could support a major new CCGT in Tasmania if required. Gas for the station was sourced from Esso/BHP Billiton-operated Gippsland Basin fields.

Transmission costs: Transmission charges were estimated to be around $1.10/GJ. Delivered gas costs were estimated to be around $4.30/GJ. This assumed an ex-plant gas price of around $3.20/GJ at Longford. Transmission tariffs applicable for Bell Bay were the zone 1 reference tariffs for the TGP which were currently $0.85/GJ for firm services and $1.10/GJ for ‘as available’ transport as at 1 January 2006. Based on these figures, a transmission cost of $1.12/GJ has been used for Bell Bay in 2007-08; however, this cost could be lower due to Hydro Tasmania’s status as foundation shipper for the TGP.

Reference: ‘Fuel resource, new entry and generation costs in the NEM’ Report 2 – Data and documentation. Draft Prepared for NEMMCO, ACIL Tasman – Economics Policy Strategy, 27 March 2007.


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