Power change political risk

THE State Government may struggle to pass two crucial bills that it needs to get its proposed deregulation of the State’s electricity industry through on schedule.

The bills, the Electricity Corporations Bill, which allows the break up of Western Power, and the Electricity Industry Bill, which sets up a heads of power for a system, are yet to be drafted and it is understood they will be introduced into parliament in October.

Electricity Industry Reform Group executive director Steve Edwell told WA Business News in July that the Government needed those bills, in particular the Electricity Corporations Bill, to pass if deregulation was to proceed on schedule.

Industry groups say a significant amount of investment will leave the State if the bills are not passed by the end of the year.

Energy Minister Eric Ripper has stated that the Government would need the support of the Greens or some Liberal Party members of the Legislative Council to pass the two bills.

A spokesperson for Opposition leader Colin Barnett said the Liberal Party was not likely to support the bills but wanted to see them drafted before making a final decision.

Alinta managing director Bob Browning said last week he would be seeking formal meetings with Mr Barnett to ascertain his position on energy reform.

“The Liberal Party needs to be a bit clearer,” he said.

Mr Browning said the establishment of a neutral network provider was a necessary part of energy reform, and added that failure to split Western Power’s generation and retail arms would not be optimal.

Alinta has told WA Business News that it will proceed with its plan to develop a power station at Alcoa’s Pinjarra refinery but will hold off on plans to develop generators at Alcoa’s Wagerup and Kwinana refineries if the break up of Western Power is delayed.

Greens member Robin Chapple said he did not support the disaggregation of Western Power and that his party colleagues would block the Corporations Bill in the upper house.

National Party electricity spokesman Monty House said he supported the principles of electricity market deregulation but could not see how it would work.

He too wants to see the bills before committing to a final answer.

The disaggregation of Western Power looms as the State Government’s equivalent of Telstra, because regional MPs are not happy with the power utility’s performance.

They cite numerous examples of power blackouts and brownouts in rural areas and poor service standards.

Independent MLC Paddy Embry said he wanted to see the bills before he committed to supporting them, but admitted he was not happy with the service standards Western Power was supplying to the bush.

That view was shared by One Nation member Frank Hough, who also opposes the break up of Western Power.