Energy acquisition news : The Australian government has struck a deal worth more than AUD6 billion ($4.65 billion) with the New South Wales (NSW) and Victorian governments to buy out their stakes in Snowy Hydro, an Australian hydropower company.

Snowy Hydro has a hydro power generation of 5,500MW, which includes the Snowy Mountains Scheme that is made up of nine major hydro power plants.

Through the deal, the Australian government becomes the sole shareholder of the hydro power company, which is expected to help in advancing the Snowy 2.0 project, a 2GW pumped hydro project to a final investment decision by its independent board. The Snowy 2.0 project will be an expansion of the Snowy Mountains Scheme to provide power for an additional 500,000 homes.

The proceedings from the transaction will be used for developing infrastructure in both the Australian states.

Currently, the Australian government is holding a stake of 13% in Snowy Hydro with NSW owning 58% and Victoria owning a stake of 29% in the Australian hydropower company. It believes that the agreement will result in delivering reliable energy and cheaper electricity to consumers along with better infrastructure and more jobs for the two states.

The transaction will give an amount of AUD4.154 billion ($3.22 billion) to NSW from the federal government in exchange of its stake in Snowy Hydro.

Commenting on the Snowy Hydro deal, John Barilaro – NSW Deputy Premier and Minister for Regional said: “These are precious funds, and every dollar we invest will be an important legacy for those men and women who contributed to the Snowy all those years ago. Now successive generations of people living and working in rural and regional NSW will benefit.”

Victoria, on the other hand, will receive AUD2.077 billion ($1.61 billion) for selling its stake to the Australian government.

Victoria Premier Daniel Andrews, commenting on the Snowy Hydro deal, said: “This is a historic deal that’s good for Victorian households, and good for our economy, as we continue to build the infrastructure and create the jobs our state needs for the future.”

The takeover of Snowy Hydro will be subject to approval of the Victorian Parliament and an appropriation bill to be passed in the Australian Parliament.

  Australia, Australian hydropower company, Energy acquisition news, Hydro power plant, New South Wales, Pumped hydro project, Snowy 2.0 project, Snowy Hydro, Snowy Mountains Scheme, Victoria