Shareholders of Tilt Renewables Ltd (NZX & ASX: TLT) were told yesterday that the company believes it has an increasing role in the Australian renewable energy scene with all the political “heavy lifting” for that country to meet its Paris commitments.
The presentation came at a time when a new Australian Liberal coalition Government was formed following the ousting of Malcolm Turnbull, who spat the dummy and says he plans to quit parliament.
That would see the Federal seat of Wentworth go into a by-election with the coalition holding only a one-seat majority in the lower house.
Media reports yesterday indicated that, despite a rebellion by conservative members that led to Turnbull’s downfall, Prime Minister Scott Morrison was unlikely to abandon the Paris agreement, in the way Donald Trump did for the United States commitment.
Yesterday’s Tilt annual meeting was told Australia’s existing Renewable Energy Target Scheme will meet soon though it will not drive market outcomes. The National Energy Guarantee (NEG) was to takeover but is “on hold,” perhaps indefinitely due to Liberal Party ructions.
Tilt claimed Australia’s market will continue to add renewables because these are getting cheaper and many market players want to purchase, and to invest, away from carbon.
“For Tilt Renewables we remain confident of opportunity to secure value where our projects are inherently competitive and positioned for opportunity in New Zealand,” the company said.
In New Zealand, Tilt sees positive ETS policy developments, and, with the upcoming closure of Huntly steam units, we see near term opportunity for efficient ‘right sized’ North Island wind projects.
However, as NZResources has said several times that Huntly gas and coal-fired station has been maintained by Genesis at the insistence of other power companies as a back-up when weather conditions see hydro storage drop and wind power weaken. This happened over two months this year, as it did in low capacity occurred for renewables.
Investors will now be pondering the future of Tilt given that the two key shareholders Infratil Ltd and Mercury NZ are planning a joint full bid for the company and could then take it private.
Tilt has told shareholders to take no action on this until an independent report is produced for the company.