It's full steam ahead for a new gas-fired power plant in the NSW Hunter Valley which the federal government says will keep energy prices low while ensuring the lights stay on.
Government-owned Snowy Hydro Limited has been given up to $600 million to construct a 660MW open cycle gas turbine at Kurri Kurri, on the site of an old aluminium smelter.
Energy Minister Angus Taylor said the project would create up to 600 new jobs during peak construction and 1200 indirect jobs across NSW.
However it will require only 10 jobs when operating.
Along with EnergyAustralia's 316MW Tallawarra B open cycle gas plant, it is expected to be generating power in time for summer 2023-24 when AGL's Liddell plant closes.
Mr Taylor said the government had given the private sector "every opportunity" to fill the gap.
"We were very clear from the start - we will not stand by and watch prices go up and the lights go off," he said.
"This project will deliver flexible gas generation to replace Liddell and maintain reliable power alongside Australia's world-leading investment in renewables."
The plant has been declared a "critical state significant infrastructure project" under NSW environmental planning laws, giving it a smoother path to approval.
Environmentalists have already panned the idea, saying gas should no longer have a place in the energy grid as Australia sought to cut its emissions.
An environmental impact statement released last week said a new gas pipeline may not be ready in time for the plant to start operating in 2023, which meant it could initially require diesel fuel.
Australian Associated Press