Wednesday, 28 September 2011

Hydro powers up to record $100m profit

Hobart Mercury
23 Sep 2011, Page: 15

Hydro Tasmania has announced a record $100 million annual profit The result was up more than $20 million on last year's profit and was underpinned by greater rainfall, improved corporate efficiency, booming interstate sales and increased exports via Basslink. Hydro chairman David Crean said. The business will return $51.7 million to government, up from $13 million last year. "We've had a very good year for Hydro Tasmania", Dr Crean said. "This result has been on the back of a far more efficient organisation post-Basslink and of course two years of good rainfall. "This improvement is almost entirely due to our growth on the mainland through our retail arm momentum and through our wholesale contract position on the mainland. "The interstate growth strategy is delivering dividends".

The government-owned business also expected to pay increasing dividends to government over coming years, Dr Crean said. "This financial year we will return $119 million to the State Government and we expect that to reach $180 million by 2016", he said. The Basslink electricity interconnector had shown its value last year by exporting more than 1300 GWs into the national electricity market, often at premium prices during times of high demand.

"Basslink has really demonstrated its dual purpose. It has demonstrated on the one hand its ability to provide security of supply, keeping the lights on in times of drought", Dr Crean said. "On the other hand it has demonstrated our ability to export into the national market at high prices and import at low prices". The Federal Government's carbon price was a plus for Australia's largest renewable energy generator, but Hydro Tasmania was expecting a modest windfall from the new laws. "Certainly not $200 million, $100 million probably not and it could be below $50 million", Dr Crean said. Liberal energy spokesman Matthew Groom said the profit should be directed towards reducing the cost of electricity for Tasmanian customers.