Row over Bell Bay deal

ALISON RIBBON and AAP
March 24, 2007 12:00am

THE proposed sale of the Bell Bay Power Station has been branded a betrayal by Tasmania's opposition parties.Hydro Tasmania has agreed to sell the station site and its gas turbines to Alinta Energy Pty Ltd.
Energy Minister David Llewellyn said yesterday he would seek approval from both houses of Parliament for the deal.
The Liberals and Greens said the sale was a broken promise by the Government.
"Labor has begun ditching its 'Hands off the Hydro' pledge to the Tasmanian people," Greens energy spokesman Kim Booth said.
He called on Mr Llewellyn to explain why the sale was not brought up at recent Government Business Enterprise hearings.
Liberal energy spokesman Peter Gutwein asked if the station was being sold with or without its $64 million debt to Hydro.
The total value of the acquisition is about $75 million, comprising a $30 million up-front payment and half of the nominal value of a pipeline capacity agreement between the pair which Alinta will terminate.
Mr Gutwein attacked the sale price.
"There's no question Alinta is getting a very sharp deal," he said.
"Some might say it's a fire-sale price."
Both Mr Gutwein and Mr Booth said the sale could be the tip of the iceberg, with speculation about whether the Government will sell its publicly-owned electricity transmission company, Transend, rife in recent weeks.
"The sale of Bell Bay could well be Labor's thin edge of the wedge, testing the water for the potential sale of Aurora or Transend," Mr Booth said.
Mr Llewellyn welcomed the sale, saying it would provide a good financial outcome for Hydro and would increase competition within Tasmania.
The Bell Bay Power Station began as an oil-fired supplementary generator in the 1960s and was later converted to run on natural gas.
"It has been important in providing energy, generation capacity and ancillary services," Mr Llewellyn said.
"However, it's a very old plant and is arguably made redundant by the introduction of Alinta's planned new combined cycle gas plant in a few years' time."