Australia's AGL turns down Alinta offer, to shut down Liddell in 2022

Doris Richards
May 22, 2018

AGL previous year outlined a A$1.36 billion plan to replace Liddell's capacity after 2022, including building two new gas-fired plants, upgrading its Bayswater coal-fired plant, and building 1,600 megawatts of wind and solar farms.

Alinta Energy's bid to acquire the power unit reportedly neither matched the interests of AGL nor its numerous shareholders.

Former deputy prime minister Barnaby Joyce has accused AGL of treating the federal government as fools after the company rejected an offer to buy its Liddell power plant.

There are various factors that AGL had to weigh before deciding to sell the company as it can bolster Alinta's competitive position in the region. AGL also needed the plant to meet consumer demand till 2022 and will use Liddell's site for battery installation after 2022 for its operations in renewable power.

But with encouragement from the government, at the end of April, Alinta and its Hong Kong-based owner, Chow Tai Fook Enterprises, made a $250m bid for the power station and site.

"In considering the offer, AGL sought external expert advice on matters relevant to the offer, including the capital expenditure requirements across all plant components and the reliability and safety profile of the ageing power station". AGL said the plan had been approved by the Australian Energy Market Operator (AEMO).

"AGL's decision is a sensible one".

Labor doesn't believe extending the life of Liddell through a purchase is the answer.

So far, it has only committed funding for a small portion of the total plan.

Frydenberg said consumers were entitled to a reduction in power prices because wholesale prices were now down by almost 30% on a year ago.

Other reports by Iphone Fresh

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