SYDNEY—NSW will use a public share offer to sell off some of its electricity assets as it pushes on with its $10 billion privatisation plan.
Treasurer Michael Costa today released the first stage of the Government's strategy for selling its electricity retail assets, indicating the retail operations of EnergyAustralia should be sold by the end of the year.
He said the Government also hoped to publicly list a newly integrated electricity business comprising Integral Energy's retail activities and power generator Eraring Energy.
That share offering would take place in the second half of 2009.
"Part of the rationale for an IPO (initial public offering) is to provide some competitive tension for the other assets that are involved in the sale strategy," Mr Costa told reporters.
"We believe not only will an IPO create a new player in the national energy market, it will also mean the other assets that will be on the market will be assets that will have greater marketability because of the scarcity of those assets, and hence a better outcome for the taxpayer."
The remaining transactions - the retail arm of Country Energy and the long-term lease of Macquarie Generation and Delta Electricity - would occur in 2009, prior to the share offering.
The strategy will now be scrutinised by the state's auditor-general, in accordance with the concession made by the NSW Government last week in order to gain opposition support for its plans.
It would also be forwarded to the Australian Competition and Consumer Commission (ACCC).
Mr Costa said financial advisers have confirmed the Government stands to make $10 billion from the sale.
But opposition energy spokesman Mike Baird highlighted a comment Mr Costa made in December 2007, when he claimed NSW would make at least $15 billion from the sale.
"We've moved from a position where the treasurer was claiming we may well get in excess of $15 billion from the power sale, now we're down to net proceeds of $10 billion," Mr Baird said.
"We've said all along we don't support the sale of the state's retailers and generators at any time or any cost."
The United Services Union (USU) said Mr Costa's announcement showed the Government only cared about profit from the sale, and not in providing the state with an essential service.
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