Following an investigation, the Economic Regulation Authority has determined that Bluewaters Power 1 Pty Ltd and Bluewaters Power 2 Pty Ltd breached the rules governing Western Australia’s Wholesale Electricity Market between October 2023 and June 2024.
Bluewaters operates the only privately owned coal-fired power station in Western Australia. Its two generation facilities are operated by two related companies – Bluewaters Power 1 Pty Ltd and Bluewaters Power 2 Pty Ltd.
The ERA has conducted concurrent investigations into the bidding behaviour of Bluewaters Power 1 and Bluewaters Power 2. We have found that Bluewaters priced its electricity at higher prices than were efficient and permitted under the rules governing Western Australia’s wholesale market.
Companies bidding to sell their electricity into the Wholesale Electricity Market are required to do so at no more than their reasonable cost of producing that electricity.
Bluewaters’ conduct had a material effect on the market, which is estimated to be around $30 million.
The ERA has issued Bluewaters with civil penalties totalling $5 million, recognising the serious effect that this behaviour has had on the market. A penalty of $1.5 million is to be paid by Bluewaters 1 and a penalty of $3.5 million is to be paid by Bluewaters 2.
Bluewaters has advised the ERA that it is disputing our finding and penalties and has referred the matter to the Electricity Review Board for review.