Edison has plans to expand in Australia

MELBOURNE --Edison is looking at expanding its Australian portfolio and could also lift its stake in New Zealand's Contact Energy.

Edison Mission Energy Australia general manager Colin Sutherland said yesterday that the Australian unit of Edison International had lodged a final bid for South Australian generator Optima Energy and could look at other opportunities.

"Australia is a very attractive proposition for Edison and there are a number of things being looked at," he said from the Power of Victoria conference.

He said that in New Zealand, Edison was looking at raising its 40 per cent stake in power company Contact Energy.

Contact was sold by the Government in May last year, with 40 per cent going to Edison and the remainder floated on the New Zealand Stock Exchange.

A six-month standstill agreement lapsed in November.

In 1997 Edison Mission bought the 1000 MW Loy Yang B brown coal-fired baseload generator in Victoria's La Trobe Valley.

Mr Sutherland said the mid-merit Optima Energy generator would complement the Loy Yang baseload plant.

"There are some synergies, we believe, in enlarging the portfolio on that basis," he said.

The South Australian Government is expected to announce the winning bidders for Optima Energy and Synergen this week.

Mr Sutherland said that if Edison was unsuccessful, it would consider whether it was interested in the last of the South Australian generators to be privatised, Flinders Power.

"We would look, but I don't know if we would bid," he said.

Edison Mission also has planning and environmental permits for a 320-MW gas-fired peaking station in the La Trobe Valley, but Mr Sutherland said the project was on hold.

"We think the market is attractive enough now for the installation of a gas peaking electricity plant," he said.

"The problem is that there are competing projects for the company globally and whether that will proceed has not been resolved."

Some international power companies are looking to wind back their involvement for a range of reasons, including disappointing power prices in the Victorian region of the National Electricity Market.

"We are here for the long haul," said Mr Sutherland. "We are not going to cut and run."