Will Hodgman, Press Release

With dam levels on average below half full and falling, the government needs to be up front about the likely ability of Hydro Tasmania to export enough power interstate this year to pay the $92 million annual rent for using the undersea electricity cable. … But he said the financial costs could not ignored at a time when the Hydro says it needs a $300 million bail-out, and points to Basslink being a negative influence on its balance sheet.

Media Release

Tasmanian Liberal Leader

WILL HODGMAN, MHA

Sunday June 11, 2006

Costs of Basslink to Hydro

The State Government should explain whether Hydro will be able to sell enough power to cover its Basslink facility fee, in light of the current dry spell.

With dam levels on average below half full and falling, the government needs to be up front about the likely ability of Hydro Tasmania to export enough power interstate this year to pay the $92 million annual rent for using the undersea electricity cable.

It should also come clean on the implications for Hydro’s bottom line of Hydro being a net importer of power during the first year of Basslink’s life.

Tasmanian Liberal leader, Will Hodgman, said one of Basslink’s benefits included drought-proofing Tasmania.

But he said the financial costs could not ignored at a time when the Hydro says it needs a $300 million bail-out, and points to Basslink being a negative influence on its balance sheet.

“The State Government has stated that at worst, Basslink would break even because extreme unmet demand for electricity interstate would help the Hydro make money,” Mr Hodgman said.

“However the government needs to explain whether Hydro can supply Tasmania’s needs as well as those of other States when its storage reports shows dams have just 32.5 p.c. of full storage energy and levels are falling.

“If modelling shows the Hydro can’t export enough power this year to cover the Basslink fee at a time when it says it needs a $300 million bail-out, or it will have to cut costs, the government needs to explain how it is going to pay it.”

Mr Hodgman said there were also implications for the State Budget if such a scenario eventuated.