29/02/2012 - 13:43

Barnett says WA should have two energy utilities

29/02/2012 - 13:43


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Barnett says WA should have two energy utilities

Premier Colin Barnett has stated that Western Australia should have two energy utilities rather than four, raising the ire of shadow minister Bill Johnston who believes investment in the sector is being threatened.

Mr Barnett has long been a critic of the four-way break-up of the old Western Power, and has suggested several times that energy retailer Synergy and generator Verve Energy should be combined.

He appeared to go a step further yesterday, during parliamentary debate over the performance of Western Power.

“I have a very wide-ranging general concern about the electricity utilities in this state because we have four when we should have two,” Mr Barnett said.

Labor leader Mark McGowan followed up by asking if the regional utility Horizon Power “would be rolled into a Synergy – Verve model”.

“No, it does not,” the premier replied, without elaborating.

Mr Johnson said the government announced in 2009, after the Oates Report, that it did not support re-amalgamation.

“But the Premier’s decision to merge Synergy, Verve Energy, Western Power and Horizon Power into two utilities presents a major threat to private investors who have invested billions of dollars to provide 40 per cent of electricity generation in Western Australia.

“The remerging of these entities has long been the mother of all thought bubbles from the premier.

“However he seems to have taken things to a whole new level and it is now time for him to put up or shut up for the sake of energy producers and consumers in the Western Australia.

Mr Barnett has previously described the break-up of Western Power as “the most catastrophic bungling of public policy in the last 20 years”.

Speaking at a WA Business News breakfast in December, Mr Barnett said “we have some repair jobs to do there, not to go back to the past, but to get that energy sector working better”.

He said the state government would seriously consider a merger of Verve and Synergy in its next term.

“Yes we will do something, but perhaps not in this term …there’s a separation…but there’s not a logical separation,” Mr Barnett said.

“The egg was broken and you can’t go back to the past and I certainly think the power line system does need to be separated… but I don’t believe the split of Verve and Synergy serves this state at all so that’s something we are looking at.”

WA’s major business groups, including the Chamber of Minerals and Energy and the Chamber of Commerce and Industry, along with the Economic Regulation Authority, have all opposed a re-merger.



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