Fossil fuel and nuclear giants prepare for green energy future

By Giles Parkinson on 15 August 2012

The big take-outs from the announcement of the TRUenergy results on Tuesday were quickly seized upon by the mainstream media: the much hyped IPO is being delayed, and the contracts for closure program for the brown coal generators is in serious trouble.

Neither announcement should be a surprise. The IPO, which was touted as the biggest in Australia for 2013, simply has to deal with too many variables – the future of the carbon tax, the shape of the renewable energy target, and proposed changes to the regulatory regime highlighted by Prime Minister Julia Gillard last week.

And despite the June 30 deadline, the contracts for closure scheme – the buyout of up to 2000MW of ageing brown coal generation by the federal government dubbed the new cash for clunkers program – remains unresolved. As pointed out in these page often enough, the sheer generosity of the government’s compensation package means the brown coal generators are making too much money to want to shut down. Perhaps Canberra will find some willing sellers of black coal generation – which finds itself particularly badly squeezed – in NSW and Queensland.

The real interest from TRUenergy came not from its results but comments delivered a few days earlier by CEO Richard McIndoe at an IPART conference in Sydney. He recognised that the electricity industry was going through as fundamental a change as that of the telecommunications sector a decade ago. No longer would utilities simply deliver as many electrons as they could to the front gate – they were now obliged to package up a suite of products enabled by the introduction of smart grids and smart meters and the like, and deregulated pricing.

“It is the kind of cultural change we have seen and accepted in telecommunications where we have moved away from fixed telephone rates to more flexible pricing plans to suit individual needs and use,” McIndoe said, according to prepared notes provided by the company.