Full description
The Electricity Commission of New South Wales was established by the Electricity Commission Act, 1950 (Act No 22, 1950). (1) The Commission consisted of five commissioners appointed by the Governor. (2) Each Commissioner was appointed for a term not exceeding seven years, but was eligible for re-appointment. (3) Two of these commissioners were identified in their instruments of appointment as Chairman and vice Chairman respectively. (4) The Commission was a body corporate with a perpetual succession, therefore having capacity to sue or be sued in its corporate name, and the right to acquire and dispose of real and personal property. (5) The Commission set its own rules for convening meetings and for meeting procedures. Three commissioners constituted a quorum, and the resolution of the majority of the members at any meeting became a decision of the Electricity Commission of New South Wales. The Commission was required to keep full and accurate records of its formal meetings, a copy of which was to be forwarded to the Minister within a week of each meeting. (6)
The Commission was subject to the direction and control of the Minister. (7)
The Commission could give directions to the electricity authorities - the Sydney County Council, Commissioner for Railways, and Southern Electricity Supply of New South Wales particularly in regard to (but not restricted to)
Supplying electricity to the public;
Improving the supply of electricity to the public; or
Delaying the construction of electricity supply works.
The Commission could also direct these authorities as follows:
To make available staff skilled in the design, construction or operation of power stations to another electricity authority;
To interchange electricity between its power stations and those operated by another electricity authority
and it could also give direction in relation to the use of plant and equipment necessary for such arrangements. Terms were to be mutually agreed between the authorities for this interchange, but if these were not in place the Minister could make directions. (8)
In regard to the construction of works for the supply of electricity the role of the Electricity Commission included:
Maintaining, operating and if necessary improving and extending works for the generation and supply of electricity vested in it;
Constructing, new, additional or supplementary works and acquiring works or property to be used for the generation or supply of electricity;
Supplying electricity to people within or outside NSW at a price agreed by the parties;
Conducting any business arising out of, or ancillary to electricity generation and supply; and .
Purchase electricity from any person. (9)
On an appointed day the electricity undertaking of the Commissioner for Railways was to be transferred to the Electricity Commission. Following this the Commission was required to ensure sufficient power was available for the operation of trains, trams and trolley- buses. A cost was negotiated between the Commission and the Commissioner for Railways for the supply of the electricity. (10)
The role of the Commission included:
Promoting and encouraging the development and use of natural resources in conjunction with the generation of electricity;
Promoting the use of electricity; and
Providing advice to those involved in the generation, transmission, supply, distribution and use of electricity.
After its constitution the Commission negotiated with the Electric Light and Power Supply Corporation Limited and the Parramatta and Granville Electric Supply Company Limited. (11) The part of the Sydney County Council that was responsible for the generation and supply of electricity was transferred to the Commission following negotiation for the division of the debts, assets and liabilities (12) To affect this both a Technical Joint Committee and a Finance Joint Committee was established. (13) The Commission could acquire the whole or any part of a power station or transmission line operated by any other electricity undertaking following agreement between the parties and the approval of the governor. (14)
The Act provided for the transfer of staff from the Sydney County Council, the electricity undertaking of the Commissioner of Railways, and Southern Electricity Supply of New South Wales and for the appointment of additional staff to carry out the role of the Electricity Commission of New South Wales. (15)
The Commission had power to borrow money for the construction or acquisition of works; the acquisition of electricity undertakings; and the discharge of liabilities, indebtedness or the renewal of loans. (16)
The Electricity Commission Act, 1950 (apart from Part VII – Emergency Provisions) was proclaimed to commence on 22 May 1950. (17) The appointment of the first commissioners was proclaimed on 19 May 1950. (18)
On 1 November 1950 the Commission took responsibility for the business and assets of the former Southern Electricity Supply of New South Wales as stipulated by section 31 of the Electricity Commission Act, 1950. (19)
The generating and transmissions functions of the Sydney County Council were transferred to the Commission on 1 January 1952. (20)
Similarly the generating and transmission functions of the Commissioner for Railways’ electricity enterprise were transferred to the Commission on 1 January 1953. (21) The four steam power stations owned and operated by the Commissioner for Railways at White Bay, Ultimo, Newcastle and Lithgow together with substations, transmission lines and underground cables which had been used to supply bulk electricity to several municipalities and shires were transferred from the Railways, however, by arrangement with the Electricity Commission the railways continued to operate and maintain some of the substations and transmission lines and carried out some of the construction and design work. (22)
The transfer of the Electric Light and Power Supply Corporation Ltd and its subsidiary Parramatta and Granville Electric Supply Company Limited was delayed owing to litigation over the valuation of the assets. However, the Electricity Commission (Balmain Electric Light Company Purchase) Act, 1956 (Act No.30, 1956) made possible its acquisition on 1 January 1957. (23)
By 1970 the Commission operated the following power stations:
Steam: Balmain; Bunnerong (‘A’ and ‘B’); Liverpool; Maitland; Munmorah; Muswellbrook; Penrith; Port Kembla (Low Power, High Power (E); High Power (Pkge); Pyrmont; Tallawarra (‘A’ and ‘B’); Tamworth (Low and High Power); Ulan; Vales Point; Wallerawang (‘A’ and ‘B’); Wangi (‘A’ and ‘B'); White Bay (High Power and Low Power); Zarra Street (Low Power and High Power)
Hydro-Electric: Brown Mountain; Burrinjuck; Hume; Keepit and Warragamba;
Internal combustion; Broken Hill. (24)
The Electricity Commission (Amendment) Act, 1981 (Act No.128, 1981) increased the Commission’s role in relation to coal mining which in the principal act had been restricted to promoting and encouraging the development of natural resources. The Commission was authorised to undertake coal mining and to use the coal for the generation of electricity or sell it for profit.
The purposes for the Commission’s involvement with coal mining were:
(a) To reduce the cost of electricity generation and supply;
(b) To facilitate the generation of electricity and
(c) To promote and encourage research into and development of the coal resources of the State.
The coal mining functions of the Commission could be carried out by the Commission, by an affiliate or both in partnership. The Commission was also authorised to joint in the formation of coal mining companies or deal in shares of coal mining companies. (25)
The Electricity Commission of New South Wales was reconstituted by the Electricity Commission (Amendment) Act 1982 (Act No.63, 1982). The Act established a Commission of between five and seven members appointed by the Governor. Matters relating to the appointment and tenure of the commissioners and the procedures of the Board were set down in schedules of the Act. (26) The Commissioners could by issuing an instrument delegate functions to:
(a) the General Manager;
(b) a committee of commissioners including the General manager, or a commissioner nominated by the General Manager;
(c) an employee of the Commission;
(d) a person holding a particular office on the staff of the Commission; or
(e) any person the Commission uses (such as consultant). (27)
While the instrument was current the person to whom the function was delegated continued to be responsible for the exercise of the function.
The office of General Manager who was the chief executive of the commission was created by the Act. The General Manager was responsible to the commissioners for managing the affairs of the agency. (28)
The Electricity Commission (Amendment) Act 1987 (Act No.105, 1987) altered the composition of the Commission to consist of between eight and ten commissioners. (29)
Following the creation of the Energy Corporation of New South Wales the clause of the principal Act which prohibited sale of electricity within a county council area was altered so that the Minister could approve this subject to any terms or conditions on the recommendation of the Energy Corporation. (30)
A new responsibility introduced by the 1987 Act was the requirement for the Commission to prepare Electricity Development and Fuel Sourcing Plans. Each plan was to cover a period of at least 30 years and to cover the following:
the cost-effective generation and supply of electricity;
the development and use of fuel sources for electricity generation;
proposals for expansion in the generation and supply of electricity;
proposals for expansion of generation and supply of electricity and action to meet or reduce demand for electricity in the period;
interstate trading or development activities planned. (31)
The draft plans were to be submitted to the Energy Corporation that was to review the plan and make written recommendations to the Commission. The Commission was to consider the recommendations of the Corporation prior to submission to the Minister. (32) The plans were to be tabled before both houses of Parliament. (33) The annual report of the Electricity Commission was to identify actions taken in accordance with the plan, identify any changes that would impact upon performance of the objectives of the plan, and other actions taken which were not in accordance with the plan. (34)
The Electricity Commission (Amendment) Act 1989 (Act No.3, 1989) once again altered the size and composition of the Commission. The amending act allowed for a Commission of between six and eight members. The Commissioners were appointed because of the managerial, commercial or other appropriate qualifications. One of the Commissioners was identified as General Manager in his instrument of appointment. Of the other members a minimum of four and a maximum of six were part time commissioners. (35)
On 1 January 1992 the Electricity Commission of New South Wales began trading as Pacific Power. The new corporate identity signalled the intention of the agency to become both nationally and internationally competitive. The operations of the agency were divided into six business units. These included three generating groups - Pacific Power Western; Pacific Power Hunter and Pacific Power Central Coast. These competed to sell power to Pacific Power Pool Trading, the marketing unit which onsold electricity generated by the various groups to county councils, major industries and interstate utilities. Pacific Power Grid managed the transmission network and Pacific Power Services provided support services to the agency. (36) Pacific Power Central Coast operated Eraring Power Station for Eraring Holdings Pty Ltd that had been established in 1981. (37)
Pacific Power had two wholly owned subsidiaries:
Pacific Power International used its expertise in coal-generated electricity to secure markets within Australia and abroad; and
ENC (management) Pty Limited was responsible for the agency’s coal mining interests. (38) In 1994 this subsidiary was re-named Powercoal Pty Ltd. (39)
On 1 July 1994 an additional subsidiary company was established - PacificGrid Pty Ltd which managed the transmission lines. The company operated a 13,000-kilometre grid and 86 substations. The role of the company was to maintain the supply of electricity to New South Wales customers and to negotiate trading arrangements with power suppliers in other states. (40)
Transgrid succeeded PacificGrid Pty Ltd assuming responsibility for operating the transmission lines from 1 February 1995 enabling Pacific Power to focus on power generation. (41)
The Electricity Legislation Amendment Act, 1995 (Act No.18, 1995) retrospectively altered the title of the Electricity Commission Act, 1950 to the Electricity (Pacific Power) Act, 1950 after which references to the Electricity Commission referred to Pacific Power, those to a commissioner were understood to be a Director of Pacific Power and those to the General Manager the Chief Executive. (42)
The principal objectives of Pacific Power were to be a successful business, to exhibit a sense of social responsibility and to conduct its operations in compliance with the principles of ecologically sustainable development. (43)
The Board of Pacific Power was to comprise:
The Chief executive;
Between three and five part-time directors appointed by the Governor. These directors were selected for their qualifications in management, commerce, finance, legal or similar expertise;
One director selected by a Committee from a list of people nominated by the Minister and the Labour Council.
Two of the part-time directors were appointed by the Minister as Chairman and Deputy Chairman respectively. (44)
The role of the Board was to determine the policies and strategic plans of Pacific Power having regard for the need for reform in the electricity industry. (45)
The Chief Executive was appointed by the Governor on the recommendation of the Minister. The Minister was to give the Board the opportunity to recommend one or more candidates prior to making an appointment. (46) The role of the Chief Executive was to manage the affairs of Pacific Power in accordance with policies and plans determined by the Board and subject to any directions by the Minister. (47)
The functions of Pacific Power could be delegated to a staff member or consultant, subsidiary company or other class of person prescribed by regulations. (48)
During the period 1992-1996 Pacific Power diversified its stations to use environmentally responsible and renewable sources of energy including solar, hydro and gas turbine generation, wind power and the use of coal bed methane as a fuel. (49)
In order to introduce competition to the electricity supply industry, Pacific Power disaggregated on 1 March 1996. Two new generating entities were created - Delta Electricity and Macquarie Generation. The Bayswater and Liddell power stations transferred to Macquarie Generation; Vales Point, Munmorah, Wallerawang and Mt. Piper transferred to Delta Electricity; and Eraring and various hydroelectric facilities remained with Pacific Power. (50)
The electricity market was regulated in 1996. The components of the market were:
TransGrid that operated the distribution lines;
Three generators - Delta Electricity, Macquarie Generation and Pacific Power; and
Six electricity distributors.
The generators sold electricity to the distributors and to large customers who on-sold to business and retail customers. Initially the NSW Government controlled the market, but commencing on 10 May 1996 the price of electricity was determined by the market forces of supply and demand. (51)
The reduced emphasis on generation of electricity enabled Pacific Power to contract competitively for many projects in the industry throughout Australia, the Pacific, and Asian nations and in 1998 it secured the following:
The maintenance contract for Collie Power Station in Western Australia;
The lead management in a consortium for the design and construction of a new power station in Callide Queensland;
Construction of Australia’s first connected wind farm in Crookwell NSW; and
Construction of Australia’s first solar suburb in Homebush NSW,
in addition to a considerable overseas business. (52)
The National Energy Market (NEM) commenced operations on 13 December 1998. This replaced the various state electricity markets. Pacific Power’s Operations and Marketing Unit conducted sales via the market. (53)
Power Coal Pty Ltd was purchased in its entirety by Centennial Coal Company Limited on 6 August 2002. (54)
Pacific Power was reconstituted and renamed by the Pacific Power Dissolution Act, 2003 (Act No.17, 2003) which came into effect on 1 July 2003. It was then renamed as the Residual Business Management Corporation and continued to deal with the residual assets and liabilities of Pacific Power under the governance of its NSW Treasury appointed General Manager. (55)
Pacific Power (International) Pty Limited continued to operate while moving into the private sector.
The Residual Business Management Corporation was dissolved on 8 January 2015 by the Statute Law (Miscellaneous Provisions) Act (No 2) 2014 (Act No.88, 2014) which amended Part 5 of the Energy Services Corporations Act 1995 (Act No.95, 1995) and repealed the Pacific Power (Dissolution) Act 2003 (Act No.17, 2003). The assets, rights and liabilities of the former authority were transferred to the Crown. (56)
Endnotes
1. Electricity Commission Act 1950, s.5(1) (a).
2. Ibid., s.5(1)(b).
3. Ibid., s.5(2)(a).
4. Ibid., s.5(1)(c).
5. Ibid., s.6(1).
6. Ibid., s.6.
7. Ibid., s.7.
8. Ibid., s.8.
9. Ibid., s.9(1).
10. Ibid., s.12.
11. Ibid., s.18.
12. Ibid., s.19-22.
13. Ibid., s.22.
14. Ibid., s.34.
15. Ibid., Part VI.
16. Ibid., s.39.
17. NSW Government Gazette, 19 May 1950, p.1354.
18. Ibid., p.1358.
19. NSW Government Gazette, 27 October 1950, p.3170.
20. NSW Government Gazette, 21 December 1951, p.3800.
21. NSW Government Gazette, 19 December 1952, p.4602.
22. Report of the Commissioner for Railways 30 June, 1953, p.46.
23. Electricity Commission (Balmain Electric Light Company Purchase) Act, 1956, s. 2.
24. Report of the Electricity Commission of New South Wales for the year ended 30 June 1970, Appendix 4 pp.31- 32 in NSW Parliamentary Papers, 1969-70-71, Vol. 4, pp.163-164.
25. Electricity Commission (Amendment) Act, 1981 Schedule 1. New Sections 13A – 13G.
26. Electricity Commission (Amendment) Act 1982, s.5A.
27. Ibid., s.5B.
28. Ibid., s.6A.
29. New Section 5a (1) of the principal Act.
30. New section 9(2) of the principal Act.
31. New Section 17A-17B of the principal Act.
32. s.17C- 17D.
33. s.17F.
34. s.55(3).
35. Electricity Commission (Amendment) Act 1989, Schedule 1.
36. Pacific Power Report for the year ended 30 June 1992. Volume 1, p.24.
37. Pacific Power Report for the year ended 30 June 1993. Volume 1, p.39.
38. Pacific Power Report for the year ended 30 June 1992. Volume 1, pp.70-74.
39. Pacific Power Report for the year ended 30 June 1994. Volume 1, p. 16.
40. loc. cit.
41. Pacific Power report for the year ended 30 June 1995. Volume 1, p.8.
42. Electricity (Pacific Power) Act, 1950, s. 3(6).
43. Ibid., s.5A.
44. Ibid., s.5B(2).
45. Ibid., s.5C.
46. Ibid., s.5D.
47. Ibid., s.5F.
48. Ibid., s.5G.
49. Report for Pacific Power for the year ended 30 June 1996. Volume 1, p.7.
50. Ibid., pp.3, 8.
51. loc. cit.
52. Report for Pacific Power for the year ended 30 June 1998. Volume 1, pp.2-5.
53. Report for Pacific Power for the year ended 30 June 1999. Volume 1, p.11.
54. Report for Pacific Power for the year ended 30 June 2002. Volume 1, p.11.
55. Pacific Power Dissolution Act, 2003, s.4; schedule 4 cls.2 (1) states the Corporation 'to be a continuation of and the same legal entity as Pacific Power. Under schedule 4 cls.2 (2) the Treasurer is taken to be the successor of Pacific Power for all purposes in respect of the rights and liabilities under guarantees entered into by Pacific Power.
56. Statute Law (Miscellaneous Provisions) Act (No 2) 2014 (Act No.88, 2014) Sch. 1, cl. 1.9 amending Energy Services Corporations Act 1995 (Act No.95, 1995), Sch. 5, cl. 22 (1) and (2) and Sch. 3, cl. 2 repealing the Pacific Power (Dissolution) Act 2003 (Act No.17, 2003).
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