Waiver for TrustPower hedge deal

By CHRIS DANIELS

TrustPower has been granted a waiver by the Stock Exchange's market surveillance panel to buy electricity from the now-defunct power retailer On Energy.

The waiver relates to rules on deals with "related parties". TrustPower is 14 per cent owned by Australian Gas Light (AGL), which also owns 62 per cent of Natural Gas. On Energy was Natural Gas' doomed foray into electricity retailing.

When On Energy sold its electricity customers to state-owned Meridian and Genesis in July, it was left with hedge contracts.

Once it sold all its customers, NGC became a net generator of electricity, and could also offer hedge deals to retailers like TrustPower.

TrustPower made the deal on July 30, then told the surveillance panel. The panel considered the deal in breach of the rules, which say any deal with a related party that could mean it became liable to pay out more than five per cent of shareholders' funds needs shareholders' approval.

Company secretary Jeff Childs said TrustPower did not think it had breached the rules because it was extremely unlikely the value of hedge deal would have got near the five per cent threshold.