Western Power is moving into the final stages of preparing for its break-up into four separate corporations, with the announcement of the chairmen and trading names of the four new entities.
Western Power is moving into the final stages of preparing for its break-up into four separate corporations, with the announcement of the chairmen and trading names of the four new entities.
The largest of the four entities will be the networks business, which will retain the Western Power name and will be chaired by company director and former Freehills partner Peter Mansell.
The generation business, which will trade as Verve Energy, will be chaired by Dampier Port Authority chairman and former BP executive Peter West.
The retail business, which faces the challenge of establishing its new brand, Synergy, in the consumer market, will be chaired by marketing adviser Michael Smith.
The fourth business will be Horizon Energy, a name revealed last year by WA Business News, which will be responsible for generating and distributing electricity in areas outside Western Australia’s South West region.
Its chairman will be former Argyle Diamonds chief executive Brendan Hammond.
Premier and Energy Minister Alan Carpenter said the restructure of Western Power was a major part of the state govern-ment’s electricity reform agenda.
He said the new appointments would take effect from April 2006, coinciding with the break-up of Western Power.
One of the first tasks for the new chairmen will be to appoint directors to complete the boards of the four corporations.
Mr Mansell said two current directors of Western Power – Gresham Partners director Jennifer Seabrook and former NSW electricity industry executive Mervyn Davies – had agreed to be directors of the ‘new’ Western Power.
Four other current directors – former banker Harvey Collins, unionist John O’Connor, former Town of Kwinana chief executive Charlotte Stockwell, and airport industry executive Alan Mulgrew – are expected to be directors of the other successor corporations.
Mr Smith, who is managing director of The Marketing Centre, said he was looking forward to applying his knowledge of marketing and retailing to his new position at Synergy.
“I was really attracted by the idea that this is a retail business and it will hang on brand and reputation,” Mr Smith said.
“The other thing that interested me is that, to make it work, you need a very sound and rigorous business model.
“There is a lovely richness of interesting aspects there.”
Mr Smith said the retail corporation’s new trading name, Synergy, offered a high degree of flexibility and could make it easier to diversify the business, if appropriate opportunities arose.
“The first thing this business has to do is earn its stripes as a retailer and, on the basis of doing that, then it opens up other possibilities,” he said.
“It would be nice to have a name that might accommodate that.”
Synergy’s new chief executive, Jim Mitchell, who started this week, comes from a finance background with Queensland company Ergon Energy, and was previously with pipeline owner Epic Energy.
He said it was critical for an electricity retailer to focus on managing risks, particularly the cost of buying power from generators.
“There are two different types of [electricity] retailer in Australia,” Mr Mitchell said.
“One is on the customer side; it will win the customer and work out how to get the power second. The other guys are risk managers. We will say we can get the power for this price, now let’s go and win the customer and earn some profits.
“Ergon was very much the latter.”
Mr Mitchell said he also wanted a culture that focused on customers.
“For our business to succeed, we have to be very strongly customer focused and we have to be very strong advocates for our customers and they are two completely different issues.”
The latter would include putting pressure on generators and the networks business so that Synergy was able to deliver appropriate services.
The chairmen appointments follow last month’s announcement of the four chief executives for the new corporations.
As well as Mr Mitchell, the other new recruit is Horizon Energy chief executive Rod Hayes. Recruited from Gladstone Area Water Board in central Queens-land, he will be based in Karratha.
Two current general managers – Doug Aberle and John Lillywhite – have been named as chief executive of Western Power and Verve Energy respectively.
