Wednesday 05 October 2016 02:38 PM
Trustpower demerger on hold after South Australian storm damages transmission system
By Paul McBeth
Oct. 5 (BusinessDesk) - Trustpower has delayed its plans to carve out its windfarms and renewable development pipeline into a standalone business after a once-in-50-year storm caused significant damage to the state's transmission system.
The Tauranga-based company won't seek a final court order for the demerger on Oct. 6 as planned and is reviewing the timeline for the split after the Australian Energy Market Operator (AEMO) suspended the South Australian market in the wake of the storm. Trustpower's Snowtown 1 and 2 windfarms weren't damaged by the storm, though they were offline for a brief spell.
The AEMO is dispatching available generation to meet demand and system security requirements, which is imposing constraints on some windfarms and will lower Trustpower's revenue by an immaterial amount until normal operations can be resumed.
"It is currently unclear how long repairs to the transmission system will take and when the market suspension will be lifted," the company said. "Trustpower is cooperating fully with the AEMO investigation and we continue to analyse the detailed data from the event."
Last month Trustpower shareholders approved the plan where Trustpower keeps the trans-Tasman generation assets, while the new entity, Tilt Renewables, gets the wind projects that are either in development or planning stages and are situated mainly in Australia.
The shares fell 0.7 percent to $7.60.