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AAP
AAP
Politics
Callum Godde and Adrian Black

Vic coal power plant likely to close early

A Victorian coal-fired power plant would be likely to shut down more than a decade sooner than its nominal closure date under Labor's renewable energy plan.

The Victorian Labor government has pledged to re-enter the energy market with the revival of the State Electricity Commission.

It has set a 95 per cent renewables target for 2035, if it wins next month's state election, the most ambitious of all Australian states.

Three coal-fired power stations remain in operation in Victoria's Latrobe Valley region - Yallourn, Loy Yang A and Loy Yang B.

Yallourn is slated to shut in 2028, while AGL last month announced its Loy Yang A station would close by mid-2035 - 10 years earlier than planned.

Loy Yang B, which generates about 20 per cent of the state's electricity needs, has a retirement date of 2047.

Grattan Institute energy program director Tony Wood said it was unlikely to run for that long in light of Labor's updated renewable and emission reduction goals.

"I would be pretty confident to say that you don't achieve 95 per cent renewables by 2035 and keep running Loy Yang B," he told AAP on Friday.

"There's no mechanism that would cause it to close earlier. But if the government goes ahead and does things which would drive that level of renewables, it would close."

Melbourne Energy Institute's Pierluigi Mancarella agrees but argues it is more an issue of economics.

"This would have happened anyway because coal plants are increasingly not performing from an economic perspective in the market," Professor Mancarella told AAP.

Loy Yang B's owner Alinta Energy said its workers were shocked by the state government's announcement and has demanded more detail.

"We need to understand more about how the government intends to manage the cost of the expedited transition, protect communities and workers, and support us to invest in the replacement generation required to keep the lights on in the state," Alinta chief executive Jeff Dimery said.

Asked about the station's future, Premier Daniel Andrews pointed to Mr Dimery's public comments last year that the plant was unlikely to still be operating by the mid 2030s.

"They're on the record," Mr Andrews told reporters in Scoresby while promising to set up a new government body to manage the offshore wind sector if Labor secures a third term.

"We have to assume that the biggest coal-fired power plant's going and the second biggest one is going to go too."

Opposition Leader Matthew Guy described the SEC's proposed revival as a plan of the past.

"The Liberals and Nationals have got a 50 per cent reduction by 2030 target to be legislated - not pie in the sky ideas from Labor," he said.

"We can achieve that by bringing gas into that mix."

Mr Guy and Victorian Nationals Leader Peter Walsh were in Mildura on Friday to promise locals in the state's northwest $100 return airfares to and from Melbourne, if elected.

Under the $23 million trial, residents within 150 kilometres of Mildura would be eligible for two $100 return flights to the state's capital over the next two years.

Mildura is one of the most marginal seats in the state and viewed as a must-win for coalition on November 26, after the Nationals lost it to independent MP Ali Cupper four years ago.

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