New power plant for Victoria

The Australian Gas Light Company (AGL) is set to build the country's largest hydroelectric power plant in 25 years in Victoria's Alpine region.

The $230 million plant, to be opened at Bogong by October 2009, will provide extra peaking electricity generation capacity for the state and boost the amount of so-called zero emission electricity the company produces.

About 200 jobs will be created by the project, which AGL decided to develop following the Victorian government's recently announced plans to introduce a renewable energy target certificate (VRET) scheme. The scheme, to be introduced in 2008, requires energy retailers to buy at least 10% of their electricity from renewable sources by 2016.

AGL chief executive Paul Anthony said the 140 megawatt plant, which would only run when demand for power peaked, would help Victoria meet its power needs.

AGL will also commission the nearby Banimboola hydroelectric power station, with an output of 12.2 megawatts, at a cost of $24 million. The Bogong station is expected to be ready for the peak summer demand of 2009/10, and together the plants will make enough electricity to meet the summer demand of about 122,000 average homes. In full production, they will cut greenhouse gas emissions by more than 185,000 tonnes annually, AGL said.