Origin in backlash on threat to pricing
ORIGIN Energy has named the electricity generation projects where it could freeze investment, in a backlash against a Federal Government plan to break up retailers who charge too much for power.
The energy heavyweight says proposed expansions of its Shoalhaven pumped hydro plant in New South Wales and Quarantine power station in South Australia were at risk, along with potential boosts to other power station facilities.
Speaking at a strategy day yesterday, Origin chief Frank Calabria said: “Shoalhaven, whether or not we expand Quarantine and how we might think about augmentation of some of our other plants are the key ones they are sitting before us.
“Therefore we need to be careful about all of those investments in the current environment and we’ll assess them against all of the criteria.”
Prime Minister Scott Morrison has proposed laws giving Canberra the power to break up energy retailers as part of a “big stick” approach to high power prices.
Origin and EnergyAustralia – two of the nation’s three big energy companies that generate power and sell it to business and consumers – warned yesterday there was too much uncertainty around energy industry regulation to invest in new capacity.
The proposed divestment powers added sovereign risk and significant costs to any investment decision, according to Origin.
Under threats of a High Court challenge to its legislation, the Government this week shifted the proposed divestment power away from the Treasurer’s discretion to the Federal Court and challenged Labor to support measures it claimed would drive down prices. But Mr Morrison’s legislation could be stuck in Parliament until April because it has been referred to a Senate inquiry.
Origin had sought legal advice on a potential High Court challenge to the legislation but has yet to make any internal decision on whether it would proceed with that course of action.