Snowy Hydro is a public company incorporated under the Corporations Act 2001 (Cth) (Corporations Act), wholly owned by the Commonwealth, and subject to the Public Governance, Performance and Accountability Act 2013 (Cth) (PGPA Act) . Snowy Hydro also remains subject to the Snowy Hydro Corporatisation Act 1997 (Cth)1 (Corporatisation Act), which conﬁrms that Snowy Hydro is not a part of, and does not represent, the Commonwealth, and is not a public authority for any purpose and is taken not to have been constituted or established for a public purpose, or for a purpose of the Commonwealth.
The Commonwealth acquired 100% of the shares in Snowy Hydro on 29 June 2018, on which date Snowy Hydro became a Commonwealth company under the PGPA Act. The Company was declared to be a Government Business Enterprise (GBE) on 2 July 2018. The Company’s Shareholder Ministers at the time of acquisition were Senator The Hon Mathias Cormann, Minister for Finance, and The Hon Josh Frydenberg MP, Minister for Environment and Energy. From 28 August 2018, the Company’s Shareholder Ministers have been Senator The Hon Mathias Cormann, Minister for Finance, and The Hon Angus Taylor MP, Minister for Energy and Emissions Reduction.
On 15 October 2018, the Shareholder Ministers issued a Statement of Expectations (SOE) to the Company, and amended the Constitution of the Company. On 26 February 2019, having provided Shareholder approval for Snowy 2.0 under the Constitution, the Shareholder Ministers issued an updated SOE.
The Shareholder Ministers have not issued any directions to the Company under its Constitution, an Act or an instrument during the period, and no government policy orders apply in relation to the Company under section 93 of the PGPA Act. The Company is not subject to a community service obligation.
The Company’s SOE requires the Company to operate at arm’s length from the Government. The SOE2 conﬁrms that the Board of the Company has ultimate responsibility for the performance of the Company and is accountable to the Commonwealth as its sole Shareholder. In accordance with the SOE, the Company is a commercial entity and is expected to operate on a commercial basis, with ﬂexibility and discretion in its operational and commercial decisions within the bounds of the legislative and governance framework. Under the SOE, the Company is expected to compete in these markets in accordance with the Commonwealth’s Competitive Neutrality Policy, and deliver ﬁnancial returns consistent with commercial operations.
The SOE states that the Commonwealth acquired 100% of the shares in the Company to support the transition of Australia's energy system, and in particular, to support the expansion of pumped-hydro in the Snowy Mountains Hydro-electric Scheme, through Snowy 2.0. Snowy 2.0 is a unique opportunity to build national economic infrastructure with real and lasting beneﬁts for Australia and the generations to come.
The SOE also states that the objectives of the Company (Objectives) are to develop, operate and maintain the Snowy Mountains Hydro-electric Scheme; own and operate other facilities for the generation of electricity; and participate in wholesale and retail markets for the sale and purchase of electricity and gas and markets for related contracts and services.
The Company’s strengths and future aspirations are captured in its Purpose, to “delight our customers with service, backed by the mighty Snowy”. The Purpose has taken on renewed meaning given the leading role that the Company is playing in underpinning the reliability and stability of Australia’s energy system as it undergoes rapid transition, and has as its foundation the existing and future generating and energy storage capabilities of the Snowy Mountains Hydro-electric Scheme and the industry-leading customer experience delivered by the Company’s retail business under the Red Energy and Lumo Energy brands.