MPs push to punish AGL for knocking back power station sale
ANGRY government MPs have ripped into a major electricity company after it knocked back an offer to buy a power station.
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FURIOUS government MPs want to punish AGL for today’s refusal to sell its Liddell power station, with former prime minister Tony Abbott comparing the electrical company to a militant union and again urging it be nationalised.
And MPs repeated accusations AGL wanted to decrease electricity supply to cash in on demand.
“It’s in their narrow commercial self-interest to get the price of power up because that pads their profits,” Mr Abbott told 2GB.
The demands for a government takeover of a private power station are too extreme and expensive to be even considered by the government, but are a measure of the anger among some coal activist MPs.
Former deputy prime minister Barnaby Joyce said the government should “cart back in” AGL for some tough talk.
The AGL board today revealed it had rejected a purchase offer from Alinta Energy because it “significantly undervalues future cash flows to AGL of operating the Liddell power station until 2022 and the repurposing of the site thereafter”.
“Consequently, AGL has reaffirmed its decision to close Liddell in December 2022 and will continue progressing its NSW generation plan, which includes repurposing Liddell,” the company said in a statement.
“The Australian Energy Market Operator has confirmed that completion of this plan will address the capacity shortfall that may occur as a result of Liddell’s closure.”
Industry players believe Alinta made the offer primarily because the government asked it to, and that AGL was never likely to sell Liddell, its NSW coal-fired power station, which it wants to shut down in four years and convert to running on gas and other fuel sources.
The government argues the loss of the coal-fired generation would create a shortfall that renewable energy could not make up.
Mr Abbott repeated his demand on 2GB today for taxpayers to fund a compulsory acquisition of AGL, and to then offer it for sale to someone who would keep the coal component.
“This is a strike against the national interest by a big business,” he said.
“My very strong view given that the federal government has effectively got responsibility for energy security, the government should compulsorily acquire this power station for the price that Alinta were prepared to pay, and then it should sell it to Alinta, who can operate it.”
Mr Joyce said: “We need to grab AGL, cart them back in and say, ‘This is BS. You’re taking us for a ride. You think we’re fools, and the Australian people are not’.”
Labor frontbencher Andrew Leigh scoffed at the threats, which he linked to what he called “an internal fight within the Liberal Party — the coal dinosaur factions who want to see taxpayers’ money go to subsidise coal-fired power plants”.
“That’s not good for energy prices in Australia and it’s certainly not good for our carbon emissions, which have continued to rise,” he told Sky News.
The official government response was to insist AGL guarantee the closure of Liddell would not cause a power shortfall.
Energy Minister Josh Frydenberg today called the no-sale decision disappointing.
He added that the continuation of Liddell beyond 2022 would benefit consumers and had the backing of some of Australia’s largest manufacturers.
“It is also disappointing because it was AGL’s CEO that first raised the prospect of Liddell’s sale in a meeting with the Prime Minister and other ministers last year,” he said in a statement.
“While the government recognises AGL has put forward a replacement plan, it has only financially committed to a fraction of the projects — namely, a 100MW upgrade to its existing coal fired Bayswater power plant and a 250MW gas peaking plant.
“The government calls on AGL to financially commit to all other stages of its replacement plan.
“Wholesale power prices in the National Electricity Market have declined nearly 30 per cent year on year and AGL’s latest half yearly report announced a 91 per cent, or $297 million, increase in statutory profit after tax for the half. Given this, customers are entitled to expect to see lower wholesale prices passed through to them in the next round of retail price determinations in July.”
Originally published as MPs push to punish AGL for knocking back power station sale