Mr. Johnston questions the Minister for Energy about awarding a power contract to TransAlta over using Alinta's existing power station. The Minister defends the decision based on efficiency, long-term supply security, and pricing.

AnsweredQoN 420Legislative Assembly
Asked
22 June 2016
Portfolio
Energy

QuestionView source ↗

ALINTA–HORIZON POWER — PILBARA
NETWORK
420. Mr W.J. JOHNSTON to the Minister for
Energy:
I have a supplementary question. Why
has the minister given a 20-year taxpayer-guaranteed contract to buy power from
TransAlta when Alinta had an unused power station available for use?

AnswerView source ↗

We entered into a take-or-pay
contract with TransAlta to build a very efficient plant that is selling
electricity to not only Horizon but also a large number of the major customers,
including FMG. It is in the depths of contracting for Roy Hill's
expansion. There is expanded need. Alinta had an old plant that had surplus
capacity because BHP Billiton did not go into its outer harbour expansion. The
advice we received was that, first, it was not clear that BHP Billiton had
substantial amounts of long-term excess capacity to meet the long-term
contracts with FMG and Roy Hill. It is still not clear that it has that.
Second, BHP Billiton's plant is much more inefficient than the
TransAlta plant being built. Third, it was not clear that the price was going
to be lower. We came to the conclusion that quite clearly in terms of safety,
long-term supply and pricing, it was appropriate to build the TransAlta plant,
and so far that is proving to be correct.

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