PROJECTS

Economic Advice to Bidder on $3.25 billion Generation and Retail Privatization

The problem

Origin Energy, one of Australia’s largest power companies, wanted to bid for the power generation and retail assets that the State of New South Wales was privatizing, but the bid risked being blocked on competition grounds. The competition issues were complicated because the privatization involved simultaneous sale of several different generation and electricity retail assets. The competitive effects would depend on the package of assets a bidder acquired, but this would not be known until after the tender was complete.

How we helped

Castalia advised Origin Energy on the economic aspects of the bid.  We demonstrated to the ACCC (the competition regulator) that, even if Origin acquired the maximum number of generation and retail assets, there would be no competitive detriment, since the number of other generators and retailers in Australia’s National Electricity Market meant Origin would not have pricing power.

Impact

Origin Energy was pre-cleared by the ACCC to bid for the assets it wanted. In 2011 Origin Energy acquired the retail arms of Integral Energy and Country Energy from the NSW government (customer base 1.6 million), and rights to the output of the Eraring Energy power stations on Lake Macquarie and in Shoalhaven, for a total price of AUS$3.25 billion.

The client

Origin Energy

Our team

Alex Sundakov

Alex Sundakov

Executive Director
Peter Hoogland

Peter Hoogland

Director

How can we help you?

How can we help you?

WASHINGTON, DC
+1 (202) 466-6790
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United States of America

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+61 (2) 9231 6862
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Australia

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New Zealand

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New Zealand

PARIS
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France

BOGOTÁ
+57 (1) 508 5794
Calle 81 #11-08, Piso 5, Oficina 5-127
Colombia

Thinking for a better world.

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WASHINGTON, DC
+1 (202) 466-6790
1747 Pennsylvania Avenue NW, Suite 1200
United States of America

SYDNEY
+61 (2) 9231 6862
Suite 19.01, Level 19, 227 Elizabeth Street
Australia

AUCKLAND
+64 (4) 913 2800
74D France Street, Newton South
New Zealand

WELLINGTON
+64 (4) 913 2800
Level 2, 88 The Terrace
New Zealand

PARIS
+33 (1) 73 44 26 97
6 Rue Duret
France

BOGOTÁ
+57 (1) 508 5794
Calle 81 #11-08, Piso 5, Oficina 5-127
Colombia

Thinking for a better world.

Castalia-logo-negative-2col
PROJECTS        NEWS        BLOG        CONTACT
© Copyright 2019 Castalia. All rights reserved.
Terms | Privacy | Credits | Sitemap