Spark Infrastructure Group – a power distributor with businesses in South Australia and Victoria – has defended its planned investments in poles and wires as efficient and necessary, asserting that the so-called “gold plating” of electricity networks is a practice restricted to government-owned network owners in other states. The Australian Financial Review reports (subscription required) that chief executive Rick Francis said that over-investment in power network infrastructure to justify price increases was a problem confined to government-owned utilities in NSW and Queensland, in comments made following Spark’s 40 per cent jump in underlying first-half profit. Francis said Spark’s three businesses – ETSA Utilities in South Australia, and Citi-Power and Powercor in Victoria – would benefit from growing cash flows in the rest of the current regulatory periods to 2015.
“We believe that we only spend where we need to,” Francis said, adding that the draft changes in rules proposed last Friday by the Australian Energy Market Commission to curb network spending were of little concern for Spark, subject to the detail to be published on rates of return and spending forecasting methods. “None of those would necessarily concern us because we are very much focused as a privatised business in terms of spending wisely and efficiently,” he said. Spark’s underlying profit rose to $96.16 million in the half, while bottom-line profit surged to $88.7 million. Spark also told investors on Monday that, while not actively seeking acquisitions, it was keen to have discussions with governments seeking to sell electricity assets, should the right opportunity arise.
In other news…
The deal between South Korea’s Hanwha to buy insolvent German solar manufacturer Q-Cells for as much as €40 million – agreed to by both companies on Monday and subject to approval from Q-Cells’ creditors – has drawn a competing bid from Spanish power-plant builder Isofoton. Bloomberg reports that the new bid was approved after Isofoton’s CEO met with the insolvency administrator for what was once the world’s biggest solar cell maker. The bid, to be made with an unidentified US investor, to Q-Cells’ creditors at an August 29 meeting.
Galaxy Resources says it expects “hockey” stick growth in the lithium market, with the anticipated combination of higher demand for electric vehicles and energy storage leader to a four-fold increase in the value of the market to $43 billion by 2020. Galaxy made the forecast after outlining plans to develop the Sal de Vida lithium project in Argentina. It comes a day after Australian lithium miner Talison announced it had agreed to a $700 million sale to New York-based Rockwood Holdings.
Australian scientist Andrew Holmes has been awarded the Royal Medal, by the Royal Society in London for work on organic electronic materials. ABC Radio National reports that Holmes and colleagues found that some plastics could work as semiconductors, and could emit light when placed between electrodes under certain conditions – and even give out a charge when placed in light. The aim is to produce thin flexible solar cell that can be placed on areas like walls and roofs.
Leading water scientists have warned that the world’s population may have to switch almost completely to a vegetarian diet over the next 40 years to avoid catastrophic food and water shortages with the extra 2 billion people expected to be alive by 2050. The Guardian reports that the report by a team at the Stockholm International Water Institute (SIWI) warns “there will not be enough water available on current croplands to produce food for the expected 9 billion population in 2050 if we follow current trends and changes towards diets common in western nations. …There will be just enough water if the proportion of animal-based foods is limited to 5% of total calories and considerable regional water deficits can be met by a … reliable system of food trade.”