Blake Dawson Waldron acted for the West Australian Government on the disaggregation of the Western Power Corporation into four new statutory electricity corporations.
The firm was appointed by the WA State Solicitor to advise on the disaggregation process, and on drafting the legislation that led to it, to create the Electricity Networks Corporation, the Electricity Generation Corporation, the Electricity Retail Corporation and the Regional Power Corporation.
Corporate partner Jon Carson said the process started in 2003, with one of the aims being to end the vertical integration of Western Power Corporation, which generated, distributed and sold power in the state. “Given the other reforms going on, [the vertical integration] was seen as counter productive to that,” he said.
Carson said the challenges of the transaction were multi-tiered, starting with the need to get the legislation right, and passed by Parliament. “We had 20 different work streams running from the legislation, vesting contracts and property, so that was probably the most challenging part,” Carson said.
“But generally there were the breadth of the four new corporations and the entire relationship — there were something like 250 new contracts brought into effect between the four organisations, just putting into place the arrangements that needed to exist.”
Carson had previously worked on the split of the State Energy Commission of Western Australia into the Electricity Corportation and Western Power, which has now been split again. But while some of his work on this split had a sense of déjà vu, this transaction was “enormously more complicated”.
The split was four ways instead of just two, and the “level of detail that had to be applied this time and the level of analysis — things fell into logical groups of gas and electricity last time”, Carson said.
“This time it was far more complicated, and financially, getting the balance sheets right for the four new corporations was more complicated.”
In addition to the 250 contracts, there were more than 80 land tenure documents created, ranging from easements, licences, sale of land agreements and indemnity arrangements for previous environmental contamination.
Carson was assisted by Darren Grondal, who provided advice on legislation issues, and Clive Lumsdon for the disaggregation process. Michael Swift, Richard Donaldson, Ben Nguyen, Andrew Barclay, David Parker, Mark White, Paul Newman, Katie Winterbourne and Marina Tinning also worked on the transaction.
“It was a pretty spectacular outcome,” Carson said.
Mallesons Stephen Jaques drafted the wholesale regulation rules and Jackson McDonald did the access work.