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Liberal Policies Weakening Hydro


Dr Rosalie Woodruff MP

Dr Rosalie Woodruff MP  -  Friday, 12 March 2021

Tags: Energy, Jobs, Transparency, Public Assets

Rosalie Woodruff MP | Greens Energy spokesperson

The Liberal Government’s policies are threatening the sustainability of Hydro Tasmania and causing the loss of jobs.

A combination of imposing excessive annual dividends and loss-making contracts for wind farms and gas have left Hydro financially weakened. Under pressure from the Gutwein Government, the state-owned electricity company is signing deals in secret that could threaten the viability of the company and increase electricity prices.

The Greens questioned Hydro Chair Evangelista Albertini in last year’s GBEs scrutiny, and he confirmed Hydro Tasmania was carrying 52 “onerous contracts” where the cost of meeting the contract’s terms is a financial loss for the company.

It appears Hydro now carries over $260 million of onerous contracts, but no breakdown of the projected losses is publicly available.

Under questioning, Mr Albertini confirmed these onerous arrangements include gas contracts and power purchase agreements with wind farms. Hydro, however, refused to detail the estimated loss of individual contracts, which companies they are with, or what subsidies are provided to other businesses in the state.

Hydro has adopted the culture of secrecy set by the Liberals in Government, hiding details of financial contracts under commercial-in-confidence, and removing important information about financial operations from its annual reports.

The Liberals have refused to use the reverse auction mechanism other states effectively employ to reach the lowest cost bid for power prices from competing project companies. Under this model proposals are also required to produce Local Community Engagement plans as well as outline their broader economic contribution to the State.

Hydro is government-owned, and must be open about its tendering and contract processes because Tasmanians have a right to know why jobs are being shed by the once profitable GBE, and whether they will end up with a bill.

Energy Minister, Guy Barnett needs to come clean with Tasmanians about Hydro’s finances and subsidised contracts to companies, and what these mean for our electricity company’s finances and future security.

How can Tasmanians have confidence in Hydro to deliver on multi-billion dollar energy projects when they are sacking staff without a proper explanation?

The other Hydro shareholder Minister - the Premier, Treasurer and Minister for Climate Change - meanwhile, has questions to answer about his role in Hydro’s apparent decline as well.