Who is Stanwell Corporation?

  • Stanwell is a Queensland Government-owned energy business.
  • Stanwell is an electricity generator. We own and operate Stanwell Power Station west of Rockhampton, the Tarong power stations and Meandu Mine near Kingaroy, and Mica Creek Power Station near Mount Isa. 
  • Our people work hard every day to generate electricity to keep the lights on in Queensland and power jobs and industry.
  • We have a retail business which sells electricity to large commercial and industrial customers in Queensland, New South Wales, Victoria and the ACT. Stanwell also earns revenue through the international sale of coal.
  • All of Stanwell’s profits are paid to the Queensland Government, to fund vital services such as schools and hospitals.
  • Stanwell has contributed strongly to Queensland’s economic growth over decades through job creation and investment and powering industry.
  • Stanwell employs 700 direct employees, 400 indirect employees (Meandu Mine), and a number of contractors who provide support for site services and unit outages. 

Who intends to launch the class action against Stanwell? 

  • Piper Alderman intends to launch a class action against Stanwell and another Queensland Government owned energy company, CS Energy. 
  • The proposed class action is opportunistic and entrepreneurial, funded by an international litigation funder that treats class actions as a means of generating profits. 
  • Queensland taxpayers are the ones who will have to bear the costs of defending this class action and this will mean reduced dividends to fund health, education and police services. 

Are the allegations by Piper Alderman true? 

  • Stanwell strongly rejects Piper Alderman’s allegations and is vigorously defending them.
  • Stanwell has never misused its market power or behaved in an anti-competitive way.
  • The National Electricity Market rules are rigorously monitored and enforced by the independent Australian Energy Regulator. It investigates every incident where prices in the wholesale spot market increase to more than $5000. It also reports on every incident where prices reach more than $250 and every incident where prices rise to more than three times the average price for that week.
  • At no stage has the Australian Energy Regulator found Stanwell misused its market power or breached market rules.
  • Many of the allegations being made by Piper Alderman quote a 2016 report by the Grattan Institute.
  • The Grattan Institute is a public policy think tank that provides analysis and commentary on a range of sectors including higher education, health, transport and energy. It does not have any official status or authority over energy markets. It does not monitor or regulate the conduct of electricity companies.
  • The Australian Energy Market Commission – which makes the rules for the National Electricity Market – has reviewed the Grattan Institute’s 2016 report and dismissed many of the claims contained in it, including key allegations which Piper Alderman is levelling against Stanwell.
  • Queensland taxpayers are the ones who will have to bear the costs of defending this class action and this will mean reduced dividends to fund health, education and police services.  

Didn’t Stanwell force up wholesale prices which was then passed through to retail and industrial customers? 

  • No. Piper Alderman’s allegations are contestable and unsubstantiated.
  • Piper Alderman’s allegations encompasses a period of tight demand supply balance, and high volatility on the wholesale electricity spot market. These high prices occurred because of the closure of power stations in the southern states, extreme heatwave conditions, very high gas prices and an increase in demand for electricity as a result of the establishment of the liquefied natural gas industry in Queensland.
  • It is normal for wholesale electricity prices in the spot market to be volatile under extreme market conditions, such as those that existed in 2017, when southern power stations had been closed, gas prices were high, demand for electricity had increased and there were heatwave conditions.
  • The class action demonstrates a clear lack of understanding of how the electricity market operates.

Didn’t the Queensland Government have to issue an emergency intervention order to stop Stanwell driving up prices after complaints by major industrial customers?

  • No. Stanwell has always acted in the best interests of its customers and complies with the rules of the National Electricity Market.
  • Piper Alderman’s allegations about Government intervention are misleading.
  • In 2017, the Queensland Government directed Stanwell to return the gas-fired Swanbank E Power Station to service. This was designed to increase the amount of electricity being generated in the Queensland market, which in turn put downward pressure on prices.
  • It took six months to return Swanbank E to service. During that time, the Queensland Government instructed Stanwell to maintain the prices at which it was already selling wholesale electricity into the spot market.
  • Prices in the electricity spot market had reduced months before the direction was issued, because heatwave conditions had eased so the demand for electricity was not as high or as volatile as it had previously been.

Why did the energy regulators investigate Stanwell’s trading behaviour?

  • The National Electricity Market rules are rigorously monitored and enforced by the independent Australian Energy Regulator. At no stage has the regulator found Stanwell misused its market power or breached market rules.
  • The Australian electricity market is closely scrutinised and regulated. 
  • As part of that process, the independent Australian Energy Regulator continuously monitors electricity wholesale markets, including bidding and rebidding, dispatch and prices.
  • The Australian Energy Regulator investigates every incident where prices in the wholesale spot market increase to more than $5000. It also reports on every incident where prices reach more than $250 and every incident where prices rise to more than three times the average price for that week. At no stage has the Australian Energy Regulator found Stanwell misused its market power or breached market rules.
  • The Australian Competition and Consumer Commission has also been conducting ongoing inquiries into electricity market pricing since 2017 with six reports published and no adverse findings against Stanwell.

Is the Federal Government reviewing Australia’s class action system?

  • The Parliamentary Joint Committee on Corporations and Financial Services is currently reviewing the class action system.  
  • When announcing this inquiry in May 2020, the Federal Attorney-General, the Hon. Attorney-General Christian Porter said there was “clear evidence that the system is not delivering fair and equitable outcomes for those mums and dads who join class actions and it demonstrates why an inquiry into all aspects of the system is needed”. 

Who pays for the class action?

  • Defending the class action will unfortunately be a long, complex and expensive process. The costs to defend will eventually be borne by Queensland taxpayers because it will reduce the dividends which Stanwell can deliver to help fund vital health, education and police services.  

How many Queenslanders or businesses have joined the class action?

  • Law firms only need a minimum of seven members to launch a class action.

Read our class action fact sheet.

Watch a message from our CEO, Richard Van Breda.