There have been mass resignations from the boards of the power generators Delta and Eraring. Nearly all of the 11 directors resigned in protest, including Tony Maher from the Eraring board.
“I don't think it's ever happened before. I find it extraordinary,” he told ABC Radio.
Opposition Leader Barry O'Farrell said, “This is an unprecedented mass resignation of New South Wales energy company directors in protest at what they see as a fire sale of electricity assets by the Keneally government.”
NSW Treasurer Eric Roozendaal said the sale was an “exceptional result” which put the state in a stronger financial position and strengthened its balance sheet.
“The completion of this first tranche of the energy reform process meets the government’s objectives – we have exited electricity retailing, we have created a competitive market structure approved by the ACCC [Australian Competition and Consumer Commission] and we have received a strong financial return for the taxpayers of New South Wales,” he said.
No mention was made by Roozendaal of the state government’s decision to supply subsidised thermal coal to the privatised power stations from the Cobbora mine near Mudgee at a cost of more than $1 billion after failing to secure an agreement with Whitehaven Coal.
Under yesterday’s deal the combination of Country Energy, Integral Energy and the Eraring Gentrader contract was sold to Origin Energy for $3.25 billion.
The combination of EnergyAustralia, the Delta West Gentrader contract bundle, the Mt Piper Extension and two Marulan development sites will be sold to TRUenergy for $2.03 billion.
TRUenergy has also committed to provide an additional $240 million in funding to enable capital improvements at the Wallerawang power station, which will no longer need to be funded by the state.
The government has received multiple bids for the further two Gentrader contract bundles – Macquarie Generation and Delta Coastal – and remains in a transaction process with parties that are focused on acquiring the contracts.
The development sites include the Mt Piper Extension dual fuel site and the Marulan site, which is approved for 800 megawatts of new gas-fired generation.
NSW Greens spokesperson John Kaye has called on the opposition to cancel the deal if it forms government next March.
“The New South Wales government is not bound by the just terms compensation provisions within the Australian constitution,” he told the ABC.
“Mike Baird, presumably the incoming treasurer, can always cancel these contracts, pay the money back and start again designing a proper future for the New South Wales electricity industry.”
Roozendaal said the sale put NSW in a stronger financial position by reducing the future requirement to invest in new power stations, strengthening its balance sheet and improving capacity to retire debt and fund frontline infrastructure.
“We will have three aggressive private-sector players fighting it out for customers in New South Wales, as well as a host of smaller players,” he said.
