Officials advised against ‘providing or hinting at providing any assistance’ to Delta Electricity

This article is more than 1 year old

This article is more than 1 year old

Scott Morrison went against Treasury advice not to canvass government assistance to an electricity company part-owned by the coal investor and Liberal party donor Trevor St Baker, documents show.

Morrison announced in March that an upgrade of the Vales Point coal plant, owned by St Baker’s Delta Electricity, was one of 12 projects the government was considering underwriting with taxpayers’ funds.

Documents released under freedom of information show St Baker has lobbied the government for support since 2017, when Treasury officials advised Morrison, then the treasurer, against agreeing to his requests.

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According to a ministerial brief, St Baker and Delta director Brian Flannery met Malcolm Turnbull, the then prime minister, and Josh Frydenberg, the then energy minister, on 8 August 2017 and expressed their desire for continued investment in coal and a moratorium on support for renewable energy. They met Morrison the next day.

In a second brief on 20 September, before a planned visit by Morrison to Vales Point that ultimately did not go ahead, Treasury officials advised against “providing or hinting at providing any assistance to Delta” for Vales Point or any other electricity assets.

“Doing so would further encourage electricity generation companies to try and offset their private investment with public assistance,” it said.

The chief executive of the Australian Conservation Foundation, Kelly O’Shanassy, said Morrison should explain why he ignored Treasury’s advice when compiling the shortlist of projects that could receive taxpayer support. The meetings with St Baker came in a year in which his family trust donated $50,000 to the Liberal party.

“It’s disturbing that one rich coal baron is able to get this kind of access to the highest political offices and push his own self-interest at the expense of Australians and our safe climate,” she said.

A government spokesman did not respond directly when asked why Vales Point was included on the shortlist, but said the underwriting program followed a recommendation by the Australian Competition and Consumer Commission that it should support bankable investment by new players in generation capacity.

Delta Electricity, which is an established player in generation, has two projects on the shortlist – the Vales Point upgrade and a pumped hydro project at Lincoln Gap in South Australia. St Baker did not respond to a request for comment before publication.

An earlier batch of documents released under freedom of information show Delta Electricity also lobbied ministers for Vales Point to be allowed to receive taxpayer support from the government’s emissions reduction fund, the “direct action” climate scheme that Morrison has promised to spend another $2bn on if re-elected.

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The coal upgrade project is registered with the fund but has been blocked by the Clean Energy Regulator from bidding for funding on the grounds the company had not provided enough information to show it should qualify.

The documents showed the environment minister, Melissa Price, requested a review of how the climate policy could be used to upgrade coal-fired power stations after being contacted by a consultant working on behalf of Delta Electricity. The consultant suggested the Clean Energy Regulator was discriminating against coal-fired electricity and said the company would consider taking the decision to the Administrative Appeals Tribunal if it was not overturned. The review, by the independent emissions reduction assurance committee, has yet to be completed.

Delta Electricity says the proposed Vales Point upgrade would reduce carbon dioxide emissions by 900,000 tonnes across a decade – about 1.3% of the plant’s emissions. The Intergovernmental Panel on Climate Change found limiting global warming to 1.5C, a goal referred to in the 2015 Paris climate agreement, requires coal use for energy to fall between 59% and 78% by 2030 compared with 2010 levels.

St Baker’s Sunset Power International, which trades as Delta Electricity, bought Vales Point from the NSW government in 2015 for $1m.

Two years later it was revalued at $730m. Last year it reported a net profit of $113m. St Baker has proposed extending its operation beyond its expected closure date of 2029 to 2049.