A 2017 sign protesting against AGL’s then-plans for a gas-fired power station near Dalton. Photo: John Thistleton.
An energy giant has made “no decision” on building a gas-fired power station in the NSW Southern Tablelands but is investigating a site’s suitability.
AGL Energy was initially handed approval for the project in 2012 at a site near Dalton in Upper Lachlan Shire, but scrapped its plans just months later.
In 2017, the company put forward a $1.5 billion plan for a gas-fired power station at the site but shelved it.
Upper Lachlan Shire Council (ULSC) held an extraordinary meeting this month, calling for clarity around the project’s potential resurrection.
“It is council’s understanding that AGL are investigating the option to submit a new application for a gas turbine power station on the same site and as a result have commenced the ‘scoping phase’ of the process in accordance with the State Government’s guidelines,” meeting documents state.
“As part of this process the applicant is required to ‘facilitate effective engagement’ and as such have commenced seeking feedback [from] the community.”
An AGL spokesperson confirmed that it was investigating the site for a future project as part of a wider strategy.
“AGL plans to develop new electricity-generation and firming projects across NSW ahead of our targeted closure of Bayswater Power Station by the end of 2033,” they told Region.
“AGL is currently seeking community feedback about the potential development of a gas power station on AGL-owned land in Dalton, and we are in the early stages of this investigation.”
According to a January 2026 newsletter directed at Dalton area residents, republished in the council meeting papers, a potential project would serve as a back-up when other technologies (such as wind, hydro or solar power) cannot meet demand.
If given the green light, the power station would be established on AGL-owned land along Walshs Road in Dalton (about four kilometres north of the township).
“AGL has looked at numerous NSW locations, and the site at Dalton is desirable because of its proximity to a major gas pipeline and electricity grid connection,” the spokesperson said.
AGL owns a site several kilometres north of Dalton, in southern NSW. Image: Upper Lachlan Shire Council.
If built, the station would have an expected capacity of about 600 to 700 MW (though this could change as it moves through the planning process).
The newsletter also said AGL was “investigating the option” of adding a grid-scale battery.
During their meeting, ULSC councillors voted to call on AGL to engage “meaningfully” with the community and for the company to appear at a public meeting.
It also decided to write to the company, urging it to follow NSW Department of Planning and Housing and Infrastructure environmental policy. (The documents predict that if the project goes ahead, it will be designated as a State Significant Development and be assessed under state planning policies.)
In its statement to Region, AGL indicated that further community engagement was on the cards.
“We believe genuine community engagement is important to AGL and it’s also a crucial element in ensuring our industry delivers the energy transition without further delay,” the spokesperson said.
“We have made no decision at Dalton and community sentiment is an important factor in any decision, particularly when you’re going to be part of that community for many decades.”
They did not answer specific questions about the kind of consultation that has taken place already.
Meanwhile, the papers for the council’s first ordinary meeting of the year (set for 19 February) include a motion that would invite AGL to make a presentation to councillors about the potential project.
