Vales Point Power Station & Eraring Energy

Concerned about the sale of two coal-fired power stations and the ramifications this would have for current and future generations, Abigail successfully demanded that the sales contracts be made publicly available.

Ms ABIGAIL BOYD: I move:

That private members' business item No. 71 outside the order of precedence be considered in a short form format.

Ms ABIGAIL BOYD (11:57): I seek leave to amend private members' business item No. 71 outside the order of precedence on the Notice Paper by omitting the words "Department of Planning and Industry" and inserting instead the words "Department of Industry."

Leave granted.

Ms ABIGAIL BOYD: Accordingly, I move:

That, under Standing Order 52, there be laid upon the table of the House within 14 days of the date of passing of this resolution the following documents in the possession, custody or control of the Treasurer, the Treasury, the Department of Premier and Cabinet, the Minister for Energy and Environment or the Department of Industry:

(a)all documents relating to, and including, the contract for the sale of Vales Point Power Station to Sunset Power International Pty Ltd and a joint venture between Vales Point Investments Pty Ltd and Waratah Energy Pty Ltd;

(b)all documents relating to, and including, the contract for the sale of Eraring Energy to Origin Energy; and

(c)any legal or other advice regarding the scope or validity of this order of the House created as a result of this order of the House. 

This Standing Order 52 motion concerns two coal-fired power stations sitting on the shores of Lake Macquarie that were sold by the Government during its sell-off of State-owned electricity generation businesses between 2012 and 2015. First, I address Vales Point. Vales Point is arguably Australia's most urban power station, situated in amongst residential areas and overshadowing parts of Lake Macquarie, which is popular with swimmers, boat enthusiasts and fishers. Built in 1978, this ageing power station has been involved in a string of regulatory issues. The community was disappointed the New South Wales Government did not tighten the Vales Point licence conditions at the end of last year to require it to install technology that is commonly used in other countries that would reduce its air pollution by up to 98 per cent.

In 2015 the Government wrote down the value of Vales Point by more than $370 million and sold it for just $1 million to Sunset Power International, owned by Trevor St Baker and Brian Flannery. The then Treasurer, Gladys Berejiklian, was reported as having said that the $1 million price tag was actually above the station's true value and that the sale would save the State from ongoing losses and liabilities associated with Vales Point's scheduled shutdown in 2021.

Less than two years later, Sunset Power International valued Vales Point Power Station at $730 million—730 times the amount it purchased the station for—and extended its operational life until at least 2029. At the time it was reported that Sunset Power International claimed the uplift in value was due to increasing wholesale electricity prices and lower coal prices. Two years after the investment, Sunset Power International shareholders extracted almost $40 million of that windfall straight into their pockets. The facts surrounding the sale of Vales Point Power Station not only point to the obvious failure that has been this Government's privatisation of significant public assets, but also raise questions about the terms of the sale by the Government to Sunset Power International. Given the Government's ongoing failure to adequately regulate Vales Point Power Station, those questions must be answered.

Ms ABIGAIL BOYD (15:33): The second part of this motion relates to Eraring Power Station, which is Australia's largest coal-fired power station. Like Vales Point, it sits on the shores of Lake Macquarie in a residential area and, similar to Vales Point, has been the subject of a string of regulatory issues, including excessive ash dust and the discovery of asbestos waste being used to cap its ash dams. The community was similarly disappointed to see the New South Wales Government refuse to tighten Eraring's licence conditions to require it to install pollution-reduction technology.

Eraring was sold to Origin Energy in 2013 for just $50 million in an arrangement that saw the Government actually paying Origin $300 million to break a coal supply contract. Although justified by then Premier Mike Baird as being necessary given the Government's previous arrangements with Origin Energy, the Government's ongoing failure to adequately regulate Eraring Power Station again raises questions around the full terms of that sale. The latest controversy involving Eraring Power Station involves the emergency closure of Myuna Bay Sport and Recreation Centre, following the Government's receipt of a report from Origin Energy in relation to the risk of a breach of its ash dam. That issue is being looked at closely, not just by The Greens but also by the member for Lake Macquarie, Greg Piper, and members of the Opposition.

Given the importance of the safe operation of both of these power stations to the residents of Lake Macquarie, the Central Coast and the Newcastle and Hunter region, given the value of Lake Macquarie to the people of New South Wales as a tourist and sports and recreation hub and given the interests of the public in ensuring the proper management of the State's assets and finances, I ask members to support this call for papers.

I seek the leave of the House to amend private members' business item No. 71 outside the order of precedence standing in my name on theNotice Paper for today by omitting "14 days" and instead inserting "21 days".

Mr David Shoebridge: You are so reasonable.

Ms ABIGAIL BOYD: I do so in an attempt to be reasonable. Thank you, Mr Shoebridge.

Ms ABIGAIL BOYD (15:50): In reply: I thank the Hon. Scott Farlow, the Hon. Adam Searle, the Hon. Taylor Martin, the Hon. John Graham and the Hon. Damien Tudehope for their contributions to this debate. It is clear that there are a great number of outstanding questions about these transactions. We appreciate the comments from the Hon. Damien Tudehope in relation to the time given, which is why we have sought to extend it by a week. Effectively though, we are talking about documents we assume to be stored electronically—and only two of them. I will mention one further issue. My understanding is that, as was reported at the time, the Australian Labor Party referred the sale of Vales Point Power Station to the Auditor-General. I have made inquiries and although the Auditor‑General received that request, to my knowledge, it was never reported. I cannot find any report; the Auditor-General cannot find any report. I think this has been going on for a few years. Let us get the documents and clear it up.

The DEPUTY PRESIDENT (The Hon. Courtney Houssos): Ms Abigail Boyd has moved a motion, to which Mr David Shoebridge has moved an amendment. The question is that the amendment of Mr David Shoebridge be agreed to.

Amendment agreed to.

Read the full transcript on Hansard here.

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