Energy security, prices and the environmental impact of production all matter to Tasmanians. Much of the wheeling and dealing occurs behind closed doors. The information that enters the public arena is usually heavily redacted with claims of 'commercial in confidence' at every opportunity.
There is universal support for renewable energy. However, the complexity of the energy sector has made it easy for governments to offer inadequate information.
A recent case in point is Hydro Tasmania's decision to terminate the Basslink Services Agreement. Like most recent government announcements it's alarmingly short on detail. Yet it's a potentially momentous event.
The BSA is an agreement between Hydro and Basslink P/L. The latter earns income by trading electricity that it pays to Hydro in return for a fee. But the income from inter-regional trading is scarcely enough to cover the monthly facility fee, let alone the ongoing costs of the side deals with Macquarie Bank, which Hydro and the Bacon Lennon government agreed to in order to get Basslink underway in 2002.
Tasmanians have a right to know more. If Hydro has terminated the agreement does that mean it no longer has to pay the facility fee, estimated to be $7 million a month? And what happens to the side deals with Macquarie costing about $4 million a month? Presumably it means the revenue from interregional trading will stay with Basslink P/L, which is in the hands of a receiver.
There are times when interregional revenue is quite low and there's little to be made by buying power in one market and transmitting it across Bass Strait. By terminating the agreement does this mean that Hydro is prepared to forgo the interregional revenue because it expects the savings from not having to pay the facility fee are far greater? If it's harder to make money from sending electricity across the strait then what does this mean for Marinus, the second interconnector?
Hydro's decision to terminate the BSA appears to be soundly based. However, the government needs to lift the veil of secrecy and start treating Tasmanians like adults who have a right to know about a key aspect of their future. I look forward to clear answers to these questions and a more open and transparent approach from both the Minister and Hydro.
The Advocate, Tuesday 15 February 2022Go Back