Generation

During the year, Origin’s owned or contracted generation capacity increased from 1,710 MW⁽¹⁾ to 5,310 MW, driving a substantial increase in earnings for the Generation segment.

Underlying EBITDA increased 80 per cent or $145 million to $327 million, reflecting the growth in Origin’s owned and contracted generation capacity. This included a full year contribution from the Darling Downs Power Station and four months’ contribution from the GenTrader arrangements for Eraring and Shoalhaven power stations entered into as part of the NSW energy privatisation process.

Origin will further expand its generation portfolio in coming years from 5,310 MW to 5,930 MW, as new and upgraded assets come online.

Commissioning of the 550 MW Mortlake Power Station in Victoria is progressing and the asset is expected to commence commercial operations in the first half of FY2012. The continued upgrade of capacity at Eraring Power Station is expected to be completed in calendar year 2012, adding an additional 70 MW. Together with Mortlake, this will increase Origin’s generation portfolio to 5,930 MW.

Origin also continues to progress its development pipeline which includes 3,670 MW of gas fired power station opportunities, including options to convert some open cycle gas turbine sites to highly efficient combined cycle gas turbines. This includes new and existing sites including Mortlake in Victoria, Spring Gully and Darling Downs in Queensland, Kerrawary in New South Wales and Quarantine in South Australia. These options provide flexibility to continue to enhance Origin’s electricity supply portfolio.

Origin continues to develop its extensive portfolio of renewable energy opportunities spanning wind, geothermal, hydro and solar energy technologies, in both domestic and offshore markets.

Origin has up to 587 MW of wind projects for which development applications have been approved, including the option to construct Australia’s largest wind farm at Stockyard Hill which received State and Federal approval during the year. A further 300 MW of projects are in the advanced planning and permitting stage, 1,200 MW in the planning and permitting stage and around 1,300 MW undergoing feasibility studies.

Origin is continuing to investigate geothermal development options both within Australia and internationally. In Australia, Origin has a 
30 per cent interest in the Innamincka Deeps joint venture with Geodynamics. Additionally, Origin has a 50 per cent interest in, and operates, the Innamincka Shallows joint venture with Geodynamics.

Internationally, Origin has targeted opportunities in countries on the Pacific “Ring of Fire” that have high geothermal potential and growing demand for energy. In September 2010, Origin and the Tata Power Company Limited of India, in consortium with PT Supraco Indonesia, were awarded the Sorik Marapi geothermal concession in Northern Sumatra, Indonesia. Additionally, in May 2011, Origin acquired a 40 per cent interest in Energia Andina S.A. (EASA), Chile’s leading geothermal exploration company. EASA has a portfolio of eight geothermal exploration projects in the northern and central regions of Chile.

Origin’s 50:50 joint venture with Micron Technology, called Transform Solar, continues to focus on the development of photovoltaic energy based on Origin’s SLIVER technology. Micron is one of the world’s leading providers of advanced semiconductor solutions. Commissioning of the first 20 MW per annum production line is in progress. Work has also continued towards a decision to increase production to 50 MW or more, which is expected to occur in FY2012.

The opportunity to undertake a world-class hydroelectric development is also being pursued through Origin’s 50:50 joint venture with PNG Sustainable Development Programme, PNG EDL. The hydro-electric potential of the Purari hydro resource at Wabo in the Gulf Province of Papua New Guinea is currently being evaluated. Capturing the power of the existing river flows, the project would have the capacity to generate approximately 1,800 MW of renewable baseload electricity.