❓ Mr. McGowan questions the Minister for Energy regarding delays in the East Perth power station redevelopment, specifically concerning Western Power infrastructure and the lack of communication with bidders. The Minister responds that bids were insufficient to cover relocation costs for Western Power facilities.
AnsweredQoN 688Legislative Assembly
QuestionView source ↗
EAST PERTH POWER STATION — REDEVELOPMENT
688. Mr M. McGOWAN to the Minister for
Energy:
I refer to the East Perth power
station site and the continuing delays in its redevelopment reportedly due to
Western Power infrastructure.
(1) As the
minister responsible for both aspects of this issue, did the minister raise
this when the East Perth power station was first included in the first 20 asset
sales program way back in 2014?
(2) Why was this issue not resolved by Western Power
and associated agencies, including the Metropolitan Redevelopment Authority,
prior to this government's glitzy expression-of-interest advertising
campaign ?
(3) Why are the
companies that were told a successful proponent would be selected by the end of
last year not being updated on the progress of their bids?
688. Mr M. McGOWAN to the Minister for
Energy:
I refer to the East Perth power
station site and the continuing delays in its redevelopment reportedly due to
Western Power infrastructure.
(1) As the
minister responsible for both aspects of this issue, did the minister raise
this when the East Perth power station was first included in the first 20 asset
sales program way back in 2014?
(2) Why was this issue not resolved by Western Power
and associated agencies, including the Metropolitan Redevelopment Authority,
prior to this government's glitzy expression-of-interest advertising
campaign ?
(3) Why are the
companies that were told a successful proponent would be selected by the end of
last year not being updated on the progress of their bids?
AnswerView source ↗
(1)–(3) Everyone
knows the East Perth power station. Next to it is a massive set of essential
transmission and other facilities for Western Power. If the old power station
is removed for alternative use, Western Power would incur very substantial
relocation costs because of the lack of alternative sites, the extent of the
equipment and, of course, the need to duplicate it. We thought it was a valuable
asset. I understand that people had approached government repeatedly over the
years—I think the previous government was going to turn it into a $500 million
museum—so we looked for and received a number of expressions of
interest, some of which were referred to in the paper today. The simple fact is
that we were not going to sell it if it was not worthwhile. The money from
people wanting to buy it had to pay for not only the value of the site, but
also the relocation of Western Power's facilities, which is a cost to
state, and we watch those things closely. The simple fact is that the bidders
did not bid a sufficient amount, in our mind, to sell the thing and incur the
cost of relocating Western Power's facilities. I might add that Western
Power is a regulated monopoly. It cannot spend money outside the Economic Regulation
Authority's approval, and because that asset or those infrastructures
are suitable, the regulator will not allow Western Power to recover that in the
regulated asset base, and the state would have to compensate it for that.
Mr M. McGowan : So
nothing is going to happen.
Dr M.D. NAHAN : If
the Leader of the Opposition knows somebody who will pay enough for that
facility to give a warrant for sale plus replace Western Power's very
expensive assets, let me know.
knows the East Perth power station. Next to it is a massive set of essential
transmission and other facilities for Western Power. If the old power station
is removed for alternative use, Western Power would incur very substantial
relocation costs because of the lack of alternative sites, the extent of the
equipment and, of course, the need to duplicate it. We thought it was a valuable
asset. I understand that people had approached government repeatedly over the
years—I think the previous government was going to turn it into a $500 million
museum—so we looked for and received a number of expressions of
interest, some of which were referred to in the paper today. The simple fact is
that we were not going to sell it if it was not worthwhile. The money from
people wanting to buy it had to pay for not only the value of the site, but
also the relocation of Western Power's facilities, which is a cost to
state, and we watch those things closely. The simple fact is that the bidders
did not bid a sufficient amount, in our mind, to sell the thing and incur the
cost of relocating Western Power's facilities. I might add that Western
Power is a regulated monopoly. It cannot spend money outside the Economic Regulation
Authority's approval, and because that asset or those infrastructures
are suitable, the regulator will not allow Western Power to recover that in the
regulated asset base, and the state would have to compensate it for that.
Mr M. McGowan : So
nothing is going to happen.
Dr M.D. NAHAN : If
the Leader of the Opposition knows somebody who will pay enough for that
facility to give a warrant for sale plus replace Western Power's very
expensive assets, let me know.
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