Brookfield lifts renewables spend to $30b in Origin takeover push

Brookfield told the ACCC that Origin, without the takeover deal, would face “significant challenges” in its ability to raise new equity and debt to fund an ambitious transition program because of its listed company structure.

Brookfield estimates that its plan to deliver 14 gigawatts of new renewables and storage would be about 10 gigawatts more than what Origin Energy would otherwise have been able to develop by 2033. The entire east coast electricity market presently has 27.5 gigawatts of large-scale clean energy capacity.

“The need to decarbonise the world’s energy systems in order to minimise the impact of climate change and limit the global temperature increase is both urgent and daunting,” Upson added.

“The amount of private sector investment required for the energy transition over a short timeframe is unprecedented.”

The most likely areas of competition concern to arise from Brookfield’s proposed takeover are its significant existing stakes in local energy infrastructure. The investment giant successfully took ownership of Victorian electricity operator AusNet last year as part of a consortium that included Sunsuper and a host of Canadian pension funds. It also holds a 50 per cent stake in the smart metering business Intellihub.

In its submission, Brookfield argues that the proposed Origin Energy takeover would not result in a substantial lessening of competition in any relevant market, adding that Origin, Ausnet and Intellihub would remain “separate entities with separate investor groups”.

Loading

“Different Brookfield funds hold majority stakes and the unaffiliated co-investors in each business are different,” it said.

EIG, which is seeking Origin’s 27.5 per cent interest in the Australia Pacific LNG (APLNG) gas venture, said the energy transition required a “whole-of-society” approach to be effective. EIG chief executive Blair Thomas said governments had an important role to play in enabling private sector capital and solutions.

“We believe this transaction is an important step in the right direction,” he said.