The State Government endorsed the March assessment of an independent Environmental Effects Statement that recommended in March that International Power should be granted access to coal in Hazelwood's West Field, relocating the Strzelecki Highway and diverting the Morwell River through a concrete pipe to allow access to the coal reserves.

Under the deed, Hazelwood will:

-Cap its greenhouse gas emissions at 445Mt

-Achieve greenhouse savings of 34Mt compared to standard output

-Have access to 43Mt of coal outside its existing mining licence boundary of West Field

-Produce greenhouse emissions goals to work towards

-Regularly report to the Government on its greenhouse performance

-Gain government incentives to invest in Victorian renewable energy projects

"This agreement is a once-in-a-generation opportunity to achieve improved environmental and economic performance from a power station synonymous with Victoria's greenhouse challenge," said Victorian minister for energy and resources Theo Theophanous.

"This is a $A400 million project that ensures Victoria's base-load power needs are secured well into the future. The deed delivers far greater greenhouse gas reductions than the planning panel had contemplated. Instead of savings of around 25Mt of greenhouse gases, this agreement achieves savings of 34Mt."

According to Theophanous, when the power station reached its cap of 445Mt of greenhouse gases it would have to close down.

"We expect the company will enter into discussions with a future government closer to that time, so that the Victorian economy can make the transition from Hazelwood to new supplies from other generators," he said.

Victorian environment minister John Thwaites said the agreement was framed to be integrated into a future greenhouse gas abatement scheme such as an emissions trading scheme.

"A future greenhouse gas emissions trading scheme will still apply to Hazelwood Power Station and could place obligations on Hazelwood's owners additional to the requirements of the deed," he said.

The Morwell River local river environment will be restored to a natural meandering course as part of the Hazelwood project.

EnvironmentalManagementNews.net