| HAS CPL embraced the Australian opposition’s plan for curbing greenhouse gases?Yallourn, one of Australia's biggest electricity generators, (1450MW) could convert to gas in the next 10 to 20 years.A key component of the Opposition Party (Tony Abbott) concerns subsidies for power stations to change their mix.TRUenergy's managing director, Richard McIndoe, told ABC1's Inside Business program over the weekend the switch to gas would be one of the most effective ways of reducing CO2 emissions.He said the speed of the change, however, would depend on government policy and compensation.Mr McIndoe says the conversion would cost up to $2.5bln and cut CO2 emissions by 75%.Power prices would also need to rise by 20% to make the switch from coal to gas commercially viable.Yallourn, based in the brown coal-rich Latrobe Valley,generates almost a quarter of Victoria's electricity and 10% of the national power grid's output.It was sold to Hong Kong interests as part of a privatisation push in the 1990s. Mr McIndoe says the Yallourn plant has a life of a further 25 years and compensation would be required to keep the company's balance sheet intact and allow it to build new efficient generators.″We bought the power station under a set of policies and regulations that were pretty clear when the Victorian government sold those power stations,″ he said.″Actually, up to a year-and-a-half, two years ago, [they] were very clear as well.″So the massive change in the regulation under which we operate is a serious concern to an international investor such as ourselves. ″Secondly, to preserve our balance sheet is very important if we are going to be investing in new generation.″ Mr McIndoe says policy changes would be needed to speed up the conversion.″You can either impose a big price on existing coal-fired generation elsewhere, or you can effectively subsidise the cost of gas-fired generation to make it competitive.″ |
