A COALITION of coal-fired electricity generators has warned that the government's plan to pay the dirtiest power plants to shut could fail to deliver value to taxpayers and has demanded an overhaul.
The National Generators Forum claims only four power stations -- Hazelwood, Energy Brix and Yallourn in Victoria, and Playford B in South Australia -- are likely to qualify for the plan to pay polluting generators to shut down.
NGF director Malcolm Roberts has told the government he "questions how competitive any tender process can be, given the handful of potential bidders and the limited capacity they have to offer".
"The NGF has concerns whether taxpayers will receive value for money under the proposed program design," he wrote in a submission on the proposed clean energy laws.
The group says that instead of being restricted to the most polluting power stations, the "contract for closure" should be open to more power plants if they could deliver cheaper cuts.
The taxpayer-funded contingency reserve has money to retire 2000 megawatts of brown-coal power. The NGF's members mostly use black coal and most are based outside Victoria and South Australia, which are dominated by brown coal.
The group warned that the government's plans for a $10 billion clean energy fund could displace viable renewable energy projects with more costly, riskier projects.
The fund and the plan to pay the dirtiest power stations to shut are key planks of Julia Gillard's clean energy plan.
Mr Roberts said yesterday the danger was that "pet" projects would be favoured.
The group warned that by investing in projects through the Clean Energy Finance Corporation, the government would be unwinding the reforms that started in the mid-1990s with the privatisation and corporatisation of the power sector.
Mr Roberts said that between 2012-13 and 2019-20, generators would need to buy $35bn worth of carbon pollution permits.
The black coal generators would lose up to $5.5bn in asset values but would receive almost no compensation.
