Energy company AGL has suspended the development of the 1000 megawatt power station in Dalton to the delight of residents.
The impending construction had been weighing on the emotions of the people of Dalton and Gunning since it was approved.
“Personally I am relieved and overwhelmed with elation at the news,” Chris Morgan from the Upper Lachlan Environment Association (ULEA), a group battling the plant, said.
“I also acknowledge that the decision can be reversed, so will proceed cautiously and will continue to be vigilant.”
The plant was given Commonwealth approval recently but the energy company is second guessing the reasons to build the plant.
“The economic viability of this project had been under review for several months because of market conditions,” AGL said in a statement on Friday.
When asked how long the suspension might apply for, an AGL spokeswoman said she couldn’t say.
AGL also made no comment when asked about the power plant being pushed through government approval as ‘critical infrastructure’ considering a need for suspension.
The Dalton station was intended to run for around 15 per cent of the year to mostly supply electricity for peak demand.
"With peak demand almost non existent, and more electricity consumers switching to PV solar and getting off the ridiculously expensive grid, the project will never be suitable under future market conditions," Mr Morgan said.
"It is a pity that it is the lust for money that has pulled it up, rather than the potential destruction of two villages and inhabitants."
The company has five years to start construction on the plant before approvals expire.
With AGL's decision to suspend the project for now, the community is still left guessing when it might go ahead.
"It's just the uncertainty," Dalton's Phil Waine said. "We want to know. It has the potential to affect property values and things later down the track."
He said the group was following what exactly the energy company would need to do to start construction.
"Whether they have to dig one hole... in 20 years time they could go ahead with the project," Mr Waine said.
However, Mr Waine said the community was pleased it had made life more difficult and expensive for the power company thus far.
"We're proud of the work we've done and the consent conditions that we've gained," he said.
The size of the power plant was reduced by a third, limited to the 15 per cent per year operating time and, if the plant exceeds any environmental criteria, such as the limits on noise or pollution, it will be shut down or limited.
"The little consent conditions that didn't seem as important at the time... may actually contribute to making them go away."