Snowy sets sights on energy market

Mr Broad, the former chief executive of Infrastructure NSW, said that realising the strength of Snowy’s Red Energy retailing business, which has grown to more than 400,000 customers, was one of the highlights of his first 12 months at the helm of the company. "I’ve been around retail businesses and I’ve never seen one as good as that," he said.

But at the same time, Snowy, which also owns gas-fired power plants, has a "very hard-edge" approach to acquisitions and any deal must add to earnings and be "self-sustaining". "The good thing about Snowy is what it hasn’t bought in the last five or six years," Mr Broad said. "A lot of others have been buying up things and leveraging their balance sheets; Snowy has been very, very conservative in its approach to whatever we want to buy.

Mr Broad said Snowy would look at all such opportunities, while declining to comment specifically on the Delta and Lumo assets. "We’ve got to move deeper and deeper into retail," he said. "To grow our business, particularly in the commercial and industrial space, we are going to have to purchase energy.

But he said state ownership would not limit Snowy’s investment options "at this point in the cycle", while its returns made it a "good asset to have". "People I think are incredibly wary [about any new privatisation move], plus we are a very strong company and we do yield good dividends.

Snowy Hydro has revealed ambitions to become the "fourth pillar" in energy retailing, supported by potential debt-funded moves to boost its access to baseload power generation.

Read more here: SMH


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