Queensland’s new CleanCo

Powering Queensland through renewable energy

The Queensland Government is committed to putting further downward pressure on electricity prices and securing Queensland’s energy supply.

As part of the Powering Queensland plan, the Government is creating a new publicly owned ‘CleanCo’ clean energy generator. CleanCo’s will secure a cleaner, more affordable, sustainable and secure energy supply for Queensland.

It will support the growth of Queensland’s renewable energy industry and increase competition in the wholesale electricity market, lowering electricity prices and facilitating a reliable and affordable transition to increased renewable energy.

Queensland’s CleanCo will deliver the Government’s objectives for a clean energy future, affordable energy prices, and growing investment in jobs.

Putting downward pressure on electricity prices

Since 2015, the Queensland Government has utilised its public ownership of energy generation and distribution assets to deliver a range of innovative reforms to successfully stabilise electricity prices in Queensland.

Once established, CleanCo will increase competition in the National Electricity Market (NEM) and put downward pressure on wholesale electricity prices — delivering benefits to individual households and large commercial and industrial customers.

The Government’s preliminary analysis indicates CleanCo should reduce wholesale electricity prices by on average around $7/MWh, which is expected to initially translate to an estimated $70 per annum saving for the average household.

CleanCo will create value by transforming intermittent renewable energy into a firm financial product, offering retailers and customers firm and reliable base load power, backed by the State’s low emission and renewable assets.

CleanCo will have a commercial mandate to increase competition to the energy market at peak demand times when wholesale electricity prices are the highest. This will drive down wholesale electricity prices, delivering cheaper energy to Queensland households and businesses.

Supporting jobs and a just transition for workers

CleanCo will mean jobs in the renewable energy industry, starting with 1000MW of new renewables like solar, wind and hydro.

Any employees transferring to CleanCo from either CS Energy or Stanwell will maintain their existing conditions, including no-forced redundancies or relocations.

Any new CleanCo employees will also be on the same terms and conditions as any transferring employees.

The Queensland Government is also establishing a new Just Transition Group with dedicated resources to lead the development of a Just Transition Policy Framework to help workers and communities as the economy transitions to renewables.

This will be supported by an Advisory Committee to assist the dedicated unit and work in partnership with workers and communities.

The Committee will be made up of the Energy GOCs, relevant unions, Jobs Queensland, the Department of Natural Resources, Mines and Energy, Queensland Treasury and the Office of Industrial Relations.

Growing Queensland’s renewable energy industry

CleanCo is part of our plan to maintain majority ownership of generation assets as we transition to 50% renewable energy to deliver secure and affordable energy.

CleanCo will have a strategic portfolio of low and no emission power generation assets, and will build, construct, own and maintain renewable energy generation.

CleanCo will continue supporting jobs in Queensland’s renewable energy industry, starting with 1000MW of new renewables like solar, wind and hydro.”

CleanCo will facilitate a smoother transition to a cleaner energy future in Queensland.

To ensure Queenslanders continue to receive the benefits of the Queensland Government’s commitment to maintaining public ownership of our energy assets, the Government is making an initial $250 million investment for the construction of new, public renewable energy generation assets like solar wind and hydro.

The Queensland Government has also announced it will work with existing generators to look at opportunities for involvement in the renewable future, complementing the work that will be done by CleanCo. This will include identifying opportunities for diversification and strengthening of generation capacity, investments and performance.

Maintaining energy security

Queensland is well positioned to transition to a clean energy future while delivering energy security, reliability, and affordability.

The Queensland Government is committed to maintaining public ownership of our electricity generation and distribution assets. As Queensland’s third publicly-owned energy generator, CleanCo will drive more competition in the energy sector and ensure Queensland’s ongoing energy security.

The new CleanCo complements Queensland’s strong position as an exporter of energy to the southern states and helps deliver more affordable energy with the right mix of dispatchable and renewable generation capacity.

 

Next steps

Queensland Treasury will work with the Department of Natural Resources, Mines and Energy, CS Energy, Stanwell and other stakeholders to establish CleanCo to deliver better energy outcomes for all Queenslanders.

Once issued with an Australian Financial Services License and other regulatory approvals, CleanCo will commence operating and trading in the NEM. An independent Board and Chief Executive will be appointed, reporting to responsible shareholding Ministers, in accordance with the operating model for Queensland’s Government owned corporations. Ongoing engagement will also occur with key stakeholders, including existing GOC power generators, Stanwell and CS Energy, and the energy sector unions.

CleanCo will ensure that any employees transferring to CleanCo from either CS Energy or Stanwell by reason of its establishment will maintain all of their existing Government-owned corporations’ entitlements, including no forced redundancies or relocations. Any new employees employed by CleanCo will be on the same terms and conditions as any transferring employees.

Additional stakeholder engagement on CleanCo’s operating model will also occur with regulators including the Australian Competition and Consumer Commission. CleanCo is expected to be trading in the National Electricity Market by mid-2019, subject to receiving regulatory approvals.

 

More information

Last updated: 14 September 2018