Taxpayers won't have to bail out Australia's largest power station - for the coming year at least - as the clock ticks on a once-in-a-generation energy transition.
Origin Energy decided not to trigger the first year of the $450 million risk-sharing deal for the ageing coal-fired facility in the Hunter Valley region in NSW.
"It shows they are making money," Premier Chris Minns told reporters on Tuesday.
"But that can change from year to year."
Eraring Power Station's scheduled closure in August was delayed for two years under a deal struck to avoid potential power shortages and price spikes.
Under the deal, NSW will cover a percentage of losses up to $225 million per year if given advance notice by Origin.
But Tuesday's decision leaves the energy giant solely responsible for any profits or losses made by the privatised 2.8GW power station in the next financial year.
Mr Minns said allowing the power station to close on its previous schedule would have put enormous pressure on the grid, energy prices and households.
Instead, the "security blanket" had allowed time for other energy projects to get up and running.
"The government made the right decision, having the guarantee in place and ensuring that the burden wouldn't fall on households ... because (Eraring) closed before alternative energy was in the system," he said.
Before the deal, the Australian Energy Market Operator had warned NSW faced reliability risks due to delays in battery projects.
Origin may still trigger the loss-sharing deal for the 2026/27 financial year.
A dividend of up to $40 million would also go to state coffers if the plant delivered a profit.
Origin paid $75 million to take over the power station on the shore of Lake Macquarie, south of Newcastle, when it was privatised in 2013.
The firm must permanently de-register all four of Eraring's power units from the national grid by May 2029.
It is building a large-scale battery at the site to take advantage of the existing transmission infrastructure.
Energy policies are shaping as a key feature of the federal election campaign amid rising household bills and investments in reducing emissions.
