Climate beats competition in $18.7b Origin Energy decision
The ACCC has approved Brookfield's Origin takeover, saying its plans to decarbonise the company outweigh competition concerns in a landmark ruling.
For the first time in Australian corporate merger history, the competition regulator has placed climate change considerations and the necessity of renewable energy investment ahead of vertical integration concerns.
In approving Brookfield Asset Management’s proposed Origin Energy takeover, the ACCC has recognised that the social benefit of an accelerated roll out of renewable energy will help the Australian economy decarbonise faster, and is more important than a possible lessening of competition arising from a gentailer and a transmission company being controlled by the same asset manager.
Tuesday’s approval is subject to undertakings that Brookfield and its consortium partner MidOcean Energy gave the ACCC during the merger review, including that Brookfield ring fence management of the funds that control gentailer Origin Energy Markets and transmission operator AusNet Services.
If it weren’t for climate change, the ACCC would almost certainly have rejected the takeover on competition grounds, if the strident language in its statement is anything to go by. “The ACCC is concerned that the vertical integration of the monopoly transmission network in Victoria with Origin’s electricity generation business will lead to anti-competitive behaviour by AusNet in favour of Origin,” it noted.
