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Australia, home of coal, signals shift away from future plants

[SYDNEY] Australia, one of the world's biggest producers of coal, doesn't expect new coal-fired plants will be the main fix for its creaking power grid as investment shifts to cheaper renewable sources, according to the head of its energy policy agency.

Advances in solar and wind mean the costs for those technologies were falling at a "breathtaking rate", the country's Energy Security Board Chairman Kerry Schott said during a briefing online Friday.

Low emissions coal plants like those built in Japan "are actually very expensive" as an option for the nation's electric grid, said Ms Schott.

"Unless there is a technological breakthrough I wouldn't anticipate personally much more coal as the existing coal fleet retires," Ms Schott said during the briefing.

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New supply sources will include "solar and wind, batteries, the smart use of pumped hydro and demand response".

Ms Schott's Energy Security Board is guiding the creation of Prime Minister Malcolm Turnbull's "National Energy Guarantee" power policy, which still lacks specifics on how to reach its goal of ensuring steady supply and lowering emissions.

Australia, where 76 per cent of power is generated by coal, is grappling with higher power prices and doubts over the reliability of its grid amid the closure of coal-fired power stations and thinning gas supplies.

Mr Turnbull has been under pressure from conservative politicians in his ruling Coalition to keep the door ajar for new coal-fired plants to ensure the lights stay on during peak summer demand following power outages in South Australia last year.

Aging coal plants including the AGL Energy - operated Liddell facility in New South Wales state are expected to halt operations early next decade with the plant's lost capacity potentially being replaced by renewables, gas and demand response.