Arrium’s saviour Sanjeev Gupta says his power plans will transform the South Australian energy market

SANJEEV Gupta believes the nation’s energy costs are “the biggest debacle in Australian history” — but the good news is he’s here to help fix the problem. The British billionaire has revealed more about his extraordinarily ambitious plans to transform our state.

SANJEEV Gupta believes the nation’s energy costs are “the biggest debacle in Australian history, in my opinion” — but the good news is he’s here to help fix the problem.

Mr Gupta on Friday said South Australia would soon find itself with a “surplus” of energy, which will make it an attractive place for energy-intensive industries — such as graphite and silicon production — to set up operations.

Mr Gupta also said he was determined to expand into automotive manufacturing and said, perhaps contrary to prevailing wisdom, having a “clean slate” to start from, rather than being involved in an existing industry, was a blessing.

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At the Australian Chamber of Commerce in Australia lunch in Adelaide, Mr Gupta told a packed house about his grand vision for his companies in Australia, built off the back of his acquisition of Arrium’s Whyalla iron ore mining and steel making assets last year.

The pillars of Mr Gupta’s plan included:

INSTALLING 1 gigawatt (about 20 per cent of SA’s current maximum capacity) of dispatchable renewable energy which will provide power to the Whyalla assets but also lead to a surplus of energy for the state as a whole;

EXPANDING the iron ore and port operations at Whyalla;

BUILDING “iStream” next-generation electric cars in Australia which could double as a power pack for houses, storing solar energy produced during the day;

DIVERSIFYING into banking, servicing the mid-market business sector.

GFG Alliance and new Arrium boss Sanjeev Gupta at the Intercontinental Hotel in Adelaide on Friday. Picture: Roy Vandervegt/AAP

While Mr Gupta did not touch on the possible impact on retail power prices of the projected coming surplus of power, he characterised South Australia’s power issues as “real, but short term’’.

Mr Gupta’s GFG Alliance group, which employs 11,000 people worldwide, acquired a majority stake in Adelaide renewable energy company Zen Energy last year, changing its name to Simec Zen Energy, and soon after announced its plans, which he said were “well under way’’.

“What I can tell you is ... if we do complete that, and of course we will complete that one gigawatt of energy in South Australia, South Australia will suddenly become a surplus energy environment.

“These (issues) which we have today are real, they are absolutely going to last for a short period of time, but there will be solutions. Why? because the market will make those solutions happen.’’

Mr Gupta said the move to renewables had happened too quickly, but rather than dwell on that, all stakeholders should now see it as an opportunity.

“That’s happened, now we need to just take this ... as an opportunity and invest in the sector and make Australia one of the highest penetration renewable countries in the world.

“Because we’ve got the resource, and we’ve got the problem now so we’ve got to fix it anyway, so we might as well use that to make this a great industry which we can be proud of.’’

Mr Gupta said his company needs “a fraction” of the power that would be produced, with the balance “to serve the market’’.

“So much so that we are thinking of energy-intensive consumption to put at Whyalla, we have amazing infrastructure there, so we’re thinking of how to use that infrastructure to actually look at things like graphite or silicon or whatever that might be — other energy-intensive industries which could be deployed there to use that energy bank which is going to be created.

“This problem will go away, it’s just a matter of time.’’

The power will be produced by a combination of solar, wind, with storage in the form of batteries — mainly for grid stability — and hydropower based around the company’s disused mines near Whyalla.

Mr Gupta said the company would build “turkey nests” out of mine waste to be filled with water which could then be used to generate hydropower by draining the water into existing mines as needed.

On the automotive front Mr Gupta would not talk about speculation the company was hoping to buy disused assets from Holden, which ceased car manufacturing in Adelaide in October last year.

On the contrary he said working from a clean slate, was an advantage.

“The fact that the car industry in Australia has died is an opportunity,’’ he said.

Mr Gupta said GFG, which was “committed” to building cars in Australia, wanted to build electric cars which could act as batteries to store renewable energy, which would be built using a tubular chassis and composite materials, making them lighter and safer.

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