The Coalition has proposed using a government-owned company to build its own gas-fired power station. 

Australia’s Liberal government - which has billed itself as a pro-private sector, free market, hands-off, party of economic managers - is making a major public-funded intervention in the electricity sector. 

Last year, the Morrison Government gave the private sector until 30 April 2021 to “reach final investment decision on 1000 MW of new dispatchable capacity in NSW”, arguing the new power supply was needed to prevent a 30 per cent increase in power bills.  

Reports this week say the government is now proceeding with plans for a gas-fired power station at the site of the former Kurri Kurri aluminum smelter near Newcastle. The new station, to be built by the federal government-owned company Snowy Hydro Ltd, is expected to have a 750MW capacity.

The government is “preparing to step up if the energy companies don't, with Snowy Hydro securing critical NSW state significant infrastructure status for their proposed Kurri Kurri gas generator”, a spokesperson for Energy Minister Angus Taylor said on Thursday. 

“Early-stage assessments of the economics of the new gas generator at Kurri Kurri are very strong, with a larger generator expected to deliver a higher rate of return than a smaller generator.”

The Snowy Hydro board may already have approved the estimated $600 million project, according to some news outlets.