REVIEW 11 Ravensworth Rail Unloader Expansion 1

MACQUARIE GENERATION 2001 REVIEW 11 Ravensworth rail unloader expansion 1

10 Technology upgrade for Liddell

16 Sawmill waste for renewable energy 19 Aussie Climb 2000—an epic fundraiser

20 Gas-fuelled power plant proposed

REVIEW 2001 CONTENTS

FINANCIAL PERFORMANCE* 4 PERFORMANCE HIGHLIGHTS 5 CHAIRMAN’S REVIEW 6 CHIEF EXECUTIVE’S REPORT 7 FOUNDATIONS FOR THE FUTURE—LIDDELL UPGRADE, RAIL UNLOADER EXPANSION, INDUSTRY ZONE, TOMAGO GAS TURBINE 10 ENVIRONMENTAL PERFORMANCE 14 RENEWABLE ENERGY PORTFOLIO—BIOMASS CO-FIRING, HYDROELECTRIC PLANT, WIND POWER STUDIES 16 IN THE COMMUNITY—AUSSIE CLIMB 2000 19 FORESTRY TRIALS, SAFETY WINNERS 20

* Macquarie Generation’s 2001 Financial Statements presented to the New South Wales Parliament are available from the Corporation’s web site or by contacting our Newcastle office. Contact details appear on the back cover of Review 2001.

Cover: Water vapour rises from Bayswater Power Station’s cooling towers. 11 Ravensworth rail unloader expansion 1

10 Technology upgrade for Liddell

16 Sawmill waste for renewable energy 19 Aussie Climb 2000—an epic fundraiser

20 Gas-fuelled power plant proposed

REVIEW 2001 CONTENTS

Cover: Water vapour rises from Bayswater Power Station’s cooling towers. 3

The LP turbine project is expected to increase generat- Letter to Shareholders A Powerful Presence ing capacity to 2060MW by 2005, making Liddell the third largest power station in the National Electricity Market. October 2001 This Report is consistent with the Macquarie Generation’s Bayswater Power Station Hon Michael Egan MLC requirement of Section 24A of the Macquarie Generation is Australia’s largest electricity (2,640MW) shares Treasurer of New South Wales, State Owned Corporations Act, 1989 the title of Australia’s largest Minister for State Development, power station. and Section 10 of the Annual Reports Vice-President of the Executive Council (Statutory Bodies) Act, 1984 and is producer. In 2001, Macquarie Generation’s Hunter Hon John Della Bosca MLC Special Minister of State, submitted to the Shareholders for Assistant Treasurer presentation to the Parliament. Valley power stations—Bayswater and Liddell—supplied Parliament of New South Wales Macquarie Street Sydney NSW 2000 approximately 15% of the electricity consumed in Dear Shareholders, Evan Rees We have pleasure in submitting the Chairman Macquarie Generation Annual Report, New South Wales, Victoria, Queensland, South Australia including the State of Financial Performance and the Statement of and the Australian Capital Territory. Review 2001 records Financial Position for the financial year ended 30 June 2001, as audited by the Grant Every-Burns Auditor-General of New South Wales. Chief Executive and Managing Director Macquarie Generation’s performance and achievements, as well as providing insight into future developments. A SUMMARY OFMACQUARIEGENERATION’S FINANCIALPERFORMANCE FROM1JULY 2000TO30JUNE2001 Financial Performance qiaetfre uae()201351.5 53.7 136.9 -54.2 1.3 223.8 6.3 14.2 120.0 2.0 344.0 22.8 51.5 14.9 6.5 -2.3 32.6 65.1 246.9 140.3 Availability (%) 523.6 Equivalent forcedoutage(%) Safety (accidentspermillionhours worked) EBIT peremployee($’000) 225.1 143.2 Operating Statistics Return (aftertax)onEquity(%) Interest Cover(times) Debt toEquity(%) EBIT toRevenue(%) 303.2 212.6 Financial Statistics 511.8 Equity Total Debt Total Assets 298.4 Statement ofFinancialPosition($millions) Dividends paid Capital expenditure Cash flowsfromoperatingactivities(excludingfinancing) Statement ofCashFlows($millions) NET PROFITAFTERINCOMETAX Income tax Net profitbeforeincometax Borrowing costs(net) Earnings beforeinterestandtax(EBIT) Depreciation Earnings beforedepreciation,interestandtax Expenses fromordinaryactivities rdcinprepoe Gh 953. 5.6 37.4 39.5 Production peremployee (GWh) Revenue Statement ofFinancialPerformance($millions) ,6. ,5. -4.3 2,158.0 2,064.8 9. 4. -26.1 15.0 940.4 816.9 694.7 939.1 3. 6955.6 86.9 75.0 135.2 59.2 103.6 1. 4. 8.2 748.7 810.2 669. -5.7 40.0 91.8 48.3 18.7 571.2 86.6 -7.7 1.2 40.0 26.2 5.9 75.2 84.8 59.3 39.6 69.4 85.8 0120 % 2000 2001 381. 17.9 11.7 13.8 . . 64.2 1.9 3.1 CHANGE Liddell Plant Performance the NationalElectricity Market. 33% to$37.69/MWh duetomaturingof 54.2%. by employee (up53.7%). per employee(up5.6%)andEBIT 40%on2000);productionvolume (up reference totheEBITsalesratio across theboardwithparticular SouthWales Parliament. New Statements presentedtothe Notes 1(a),2and3oftheFinancial Performance. Thisisdetailedin Standard AAS1StatementofFinancial accordancewithrevisedAccounting in expensesfromordinaryactivities and yearreclassifiedasrevenue 2000 the netabnormalitemsfrom $140.3 million.Thisamountrepresents by $34.4millionfrom$174.7to and improvedcostcontrol. selling prices,increasedsalesvolume to $212.6millionasaresultofimproved increased by51.5%from$140.3million Performance Highlights Average NSWpoolpricesincreasedby Safety performance(LTIFR) improved Improved efficiencylevelswereevident The EBITfor2000hasbeendecreased Earnings beforeinterestandtax(EBIT) Energy sentout Bayswater 9,289.75 GWh Energy sentout Plant availability 15,246.16 GWh significant 120%dueto: a indebt. increase 7.7%to$69.4million despitethe by increased by55.6%to135.2%. As aresultthedebttoequityratio $939.1million,comprisedof: to Note 17oftheFinancialStatements). undertaken bytheShareholders(refer theCapitalRestructurePolicybeing of million to$694.7asaresult Net profitbeforetaxincreasedby Net borrowingcostsdecreased Total debtincreasedby$122.2million Total equitydecreasedby$245.7 increased sales revenue of12.2%; increased sales volume of5%; 33%; of increased averageNSWpoolprices repayment program. the Corporation’s ongoingdebt October2001whichwaspartof in offset byarepaymentof$67.8million Restructure Policy;and 2001 asaresultoftheCapital raised bytheCorporationinApril an additional$190millionofdebt 90.12% Forced outagerate Plant availability 83.62% 1.87% Forced outagerate Station triprate similar tothoserecordedlastyear. availability andforcedoutagerates standard ofplantperformancewith the $100 million. to 136.9%from6.3%to14.9%. by significant75%to$103.6million. a and 4oftheFinancialStatements. difference. ThisisdetailedinNotes1(b) difference reassessedasapermanent millionduetoapriorperiodtiming $8 tax ratesfrom34%to30%and balances forthereductionincorporate restatement ofthedeferredtax adjustment of$6millionduetothe The Corporationmaintainedavery high Dividend providedincreasedby100% Return onequityaftertaxincreased Net profitaftertaxincreasedby Income taxexpenseincludesacredit decreaseinfuelcostsof1.1%. a ordinary activitiesof2.3%including reduction inotherexpensesfrom 7.7%;and of reduction innetborrowingcosts increased totalrevenueof8.2%; 0.55 trips/1000hrs 2.14% Station triprate Thermal efficiency(sentout) 0.27 trips/1000hrs Production perEmployeeGwh Safety (LTIFR) Forced OutageRate% Availability % Debt toEquity% Return onEquity(aftertax)% Net Profit$Millions EBIT $Millions Thermal efficiency(sentout) 2001 32.70% . 424.6 14.2 6.5 86.6 953. 34.0 37.4 39.5 1. 4. 165 140.3 212.6 3. 6998.6 86.9 135.2 2.0 103.6 2000 14.9 1999 35.32% 91.8 .21.09 1.32 59.2 . 5.0 6.3 93.1 46.6

5 A SUMMARY OFMACQUARIEGENERATION’S FINANCIALPERFORMANCE FROM1JULY 2000TO30JUNE2001 Financial Performance rdcinprepoe Gh 953. 5.6 51.5 53.7 136.9 -54.2 37.4 1.3 223.8 6.3 14.2 39.5 120.0 2.0 344.0 22.8 51.5 14.9 6.5 -2.3 32.6 65.1 246.9 Production peremployee (GWh) 140.3 Availability (%) 523.6 Equivalent forcedoutage(%) Safety (accidentspermillionhours worked) EBIT peremployee($’000) 225.1 143.2 Operating Statistics Return (aftertax)onEquity(%) Interest Cover(times) Debt toEquity(%) EBIT toRevenue(%) 303.2 212.6 Financial Statistics 511.8 Equity Total Debt Total Assets 298.4 Statement ofFinancialPosition($millions) Dividends paid Capital expenditure Cash flowsfromoperatingactivities(excludingfinancing) Statement ofCashFlows($millions) NET PROFITAFTERINCOMETAX Income tax Net profitbeforeincometax Borrowing costs(net) Earnings beforeinterestandtax(EBIT) Depreciation Earnings beforedepreciation,interestandtax Expenses fromordinaryactivities Revenue Statement ofFinancialPerformance($millions) ,6. ,5. -4.3 2,158.0 2,064.8 9. 4. -26.1 15.0 940.4 816.9 694.7 939.1 3. 6955.6 86.9 75.0 135.2 59.2 103.6 1. 4. 8.2 748.7 810.2 669. -5.7 40.0 91.8 48.3 18.7 571.2 86.6 -7.7 1.2 40.0 26.2 5.9 75.2 84.8 59.3 39.6 69.4 85.8 0120 % 2000 2001 381. 17.9 11.7 13.8 . . 64.2 1.9 3.1 CHANGE Liddell Plant Performance the NationalElectricity Market. 33% to$37.69/MWh duetomaturingof 54.2%. by employee (up53.7%). per employee(up5.6%)andEBIT 40%on2000);productionvolume (up reference totheEBITsalesratio across theboardwithparticular SouthWales Parliament. New Statements presentedtothe Notes 1(a),2and3oftheFinancial Performance. Thisisdetailedin Standard AAS1StatementofFinancial accordancewithrevisedAccounting in expensesfromordinaryactivities and yearreclassifiedasrevenue 2000 the netabnormalitemsfrom $140.3 million.Thisamountrepresents by $34.4millionfrom$174.7to and improvedcostcontrol. selling prices,increasedsalesvolume to $212.6millionasaresultofimproved increased by51.5%from$140.3million Performance Highlights Average NSWpoolpricesincreasedby Safety performance(LTIFR) improved Improved efficiencylevelswereevident The EBITfor2000hasbeendecreased Earnings beforeinterestandtax(EBIT) Energy sentout Bayswater 9,289.75 GWh Energy sentout Plant availability 15,246.16 GWh significant 120%dueto: a indebt. increase 7.7%to$69.4million despitethe by increased by55.6%to135.2%. As aresultthedebttoequityratio $939.1million,comprisedof: to Note 17oftheFinancialStatements). undertaken bytheShareholders(refer theCapitalRestructurePolicybeing of million to$694.7asaresult Net profitbeforetaxincreasedby Net borrowingcostsdecreased Total debtincreasedby$122.2million Total equitydecreasedby$245.7 increased sales revenue of12.2%; increased sales volume of5%; 33%; of increased averageNSWpoolprices repayment program. the Corporation’s ongoingdebt October2001whichwaspartof in offset byarepaymentof$67.8million Restructure Policy;and 2001 asaresultoftheCapital raised bytheCorporationinApril an additional$190millionofdebt 90.12% Forced outagerate Plant availability 83.62% 1.87% Forced outagerate Station triprate similar tothoserecordedlastyear. availability andforcedoutagerates standard ofplantperformancewith the $100 million. to 136.9%from6.3%to14.9%. by significant75%to$103.6million. a and 4oftheFinancialStatements. difference. ThisisdetailedinNotes1(b) difference reassessedasapermanent millionduetoapriorperiodtiming $8 tax ratesfrom34%to30%and balances forthereductionincorporate restatement ofthedeferredtax adjustment of$6millionduetothe The Corporationmaintainedavery high Dividend providedincreasedby100% Return onequityaftertaxincreased Net profitaftertaxincreasedby Income taxexpenseincludesacredit decreaseinfuelcostsof1.1%. a ordinary activitiesof2.3%including reduction inotherexpensesfrom 7.7%;and of reduction innetborrowingcosts increased totalrevenueof8.2%; 0.55 trips/1000hrs 2.14% Station triprate Thermal efficiency(sentout) 0.27 trips/1000hrs Production perEmployeeGwh Safety (LTIFR) Forced OutageRate% Availability % Debt toEquity% Return onEquity(aftertax)% Net Profit$Millions EBIT $Millions Thermal efficiency(sentout) 2001 32.70% . 424.6 14.2 6.5 86.6 953. 34.0 37.4 39.5 1. 4. 165 140.3 212.6 3. 6998.6 86.9 135.2 2.0 103.6 2000 14.9 1999 35.32% 91.8 .21.09 1.32 59.2 . 5.0 6.3 93.1 46.6

5 7 The Corporation’s exceptional results could not have been achieved without the full co-operation and dedication of the Executive team and all other employees of the Corporation who Evan Rees (Chairman), Grant Every-Burns (Managing Director), James Watt, Anna Buduls, John Cahill, Deborah Page, Robert Webster wholeheartedly supported the Chief Executive and the Board in their endeavours to make Macquarie Generation one of the leaders in our industry in Australia. Chairman’s Review Board of Directors

It is pleasing to report a profit result operating plant for all the units performance and use these Macquarie Generation recognises that exceeded our optimistic forecasts. was less than 2.5% which compares opportunities to seek their comments the difficulties faced in regional This improved result was generated in the main from much better pool prices favourably with the world’s best for and input on areas of improvement. areas and believes that development for electricity. In line with our Corporate of the Industry Zone adjacent to our age and type of equipment. During the year the Board revisited aim we remained under contracted to Bayswater and Liddell is very positive allow maximum exposure to pool prices. In the marketplace, we view with internal risk management functions to for industry, the community and the particular concern the proposed review policy in Treasury Procedures, Tight control on discretionary costs Electricity Trading Policy and Health and growth of local employment. We increase in value of Lost Load to and maintenance resulted in reduced Safety Procedures. Each of these have been encouraged by the $10,000/MWh. We see this as costs even though volumes increased policies has been reviewed and revised. support of the local Councils and excessive and largely having the by 8.2%. Earnings before interest and the Mayors of Muswellbrook and effect of increasing risk to participants The Corporation believes coal fired tax increased by 51.5% to $212.6 million Singleton in particular. for no perceived good reason. The new generation will remain a significant and giving a 14.9% return on equity. This in Executive Team forums recently established by the essential source of power for decades The year ahead should be another turn allowed us to give a much Council of Australian Governments to come. However we recognise the good year for the Corporation with improved dividend to our Shareholders. (CoAG) should vigorously examine growing concerns with greenhouse increased demand for electricity to the Bearing in mind that each year we these matters. gases and believe it is also our point that one of our two idle 500 MW are operating in a more complicated responsibility to progressively improve generators will be needed in peak The Corporation’s exceptional results our power generation facilities to reduce National Electricity Market where demand season leading to increased could not have been achieved without CO2. In response to this need we plan constant changes are being profit and improved productivity. the full co-operation and dedication over the next few years to invest experienced with both regulation and of the Executive team and all other strongly in plant improvements. increased competition from outside our employees of the Corporation who After 30 years of service Liddell will be natural market area, greater reliance is wholeheartedly supported the the first beneficiary of such upgrades to being placed on our trading teams. Chief Executive and the Board in HE Rees improve its capacity and efficiency. their endeavours to make Macquarie Chairman Their efforts are supported by plant The new control systems and turbines Generation one of the leaders in our maintenance to achieve long term will significantly reduce the greenhouse industry in Australia. Grant Every-Burns (Chief Executive and Managing Director), David Ipkendanz (Chief Financial Officer and Company Secretary), Russell Skelton (Manager Marketing and Trading), Steve Ireland reliability. Three generation units impact by the equivalent of removing (Manager Fuel and Environment), John Marcheff (Manager Liddell), John Neely (Manager Bayswater), Lee Edmonds-Ward (General Manager Human Resources) were given planned overhauls during To this end we provide regular 66,000 cars from the road. the year. The failure rate of the feedback to all our staff on business (up 44%) (EBIT) of$212.6million(up51.5%) eye-catching resultsincluding: operation yieldedanumberof The Corporation’s sixthyearof was thehighlightofasuccessfulyear. and exceedingkeyexpectationsin2001 system of750MW Once againthebenefitsofmaintainingstandbycapacityandtakingdeliberatemeasurestoreduceCorporation Generation performance, thewaythatMacquarie substantialimprovementinfinancial a While itisalwayspleasingtoreport from additionalsales of$61.5million Corporationbenefitednot only The across south-easternAustralia. Victoria andaveryhotsummer period by someextensiveplantfailures in atightersupplysituationbroughton of Wales increasedby33%asaresult The electricitypoolpriceinNewSouth Rate (improved54.2%) Chief Executive’s Report Net ProfitbeforeTax of$143.2million Revenue of$810.2million(up8.2%) Earnings beforeInterestandTax Safety, LostTime InjuryFrequency Dividend of$100million(up100%) Expenses of$511.8million(down2.3%) 1 ’ s peoplewentaboutdelivering — and inNewSouthWales of275MW measures toreduce theCorporation’s standby capacityandtakingdeliberate Once againthebenefitsofmaintaining at Bayswater. rescheduling ofmajorplannedoutages maintenance spendingatLiddell and environment thatdictatedadditional The resultswereachievedinamarket outage periodwasgreatlyappreciated. capacity duringanextendedBayswater bring thatstationtofullproduction the willingnessofteamsatLiddellto critical timeshasneverbeenbetterand employees totherapidrepairofplantat to ourresults.Thecontributionof Bayswater PowerStationswascentral The performanceatLiddelland the pre-deregulationlevelsof1995. future. Thesepricesarestilllowerthan ensure continuedreliablesupplyinthe the newinvestmentnecessaryto in thepastbutareessentialtounderpin sustainable returnstotheindustrythan They arenotonlybringingmore are importantforanumberofreasons. It mustbesaidthatthehigherprices but alsoreducedcostsof$11.8million. — it isnowonderthatsupplyanddemandtightening. environmental improvement. commitment tocost-effective the Corporationhasastrong usual. Suchprojectsarenotcheap but tonnes peryearoverbusinessas carbon dioxideemissionsof300,000 generating capacityandareductionin Liddell willboastanextra60MWof environmental benefits.By2005, systems willdeliveroperationaland pressure turbinesandoldcontrol Replacement ofthestation’s low life wellintothisnewcentury. upgrade toextenditsusefuleconomic 30thanniversaryofa$72million its Liddell withtheannouncementon We havesignalledourconfidencein newpeakinggeneration. of rapidconstruction are spurringthe thatmarketpressures pleasing tosee Australia andVictoriawhereitis South This isparticularlyevidentin supplyanddemandistightening. that Wales of275MW—itisnowonder of system yearly averageloadgrowthonthe business riskwereconfirmed.Giventhe 750 MW—andinNewSouth ’ s businessriskwereconfirmed.Giventheyearlyaverageloadgrowthon half ourcurrent requirements. million tonnesperyear, whichexceeds rail throughputtoapotentialof 6.5 The plannedmodificationswillincrease conveyor systemsandroadtransport. economic reachofitsoverland of acceptingcoalbeyondthe was formedin1996,ithadnomeans Ravensworth. WhentheCorporation expansion oftherailcoalunloaderat We arenowproceedingwithafurther the economygenerally. concern toelectricityconsumersand competitivelypricedcoalisofvital to Corporation’s continuing access the thedomesticcoalmarket.Clearly, in thereisvibrantcompetition ensuring continues tofocusitsefforton production andtheCorporation significant inputinthermalelectricity The costoffuelremainsthemost greenhouse emissions. operational outcomesandreduce Bayswater inordertoimprove now beingcloselyexaminedat Thermal efficiencyimprovementsare Financial Statements. in Notes1(a),2and3ofthe Explanatory notecanbefound the resultsbetweenyears. Abnormals. Thisnormalises Profit beforeTax and Net 1 Compared with2000 an oversupplysituation inthatregion constructed inQueenslandwillcause capacity beingcommissionedor The largequantitiesofnewgenerating Interconnector (QNI). Queensland toNewSouthWales Market withcommissioningofthe formally joinedtheNationalElectricity In February2001,Queensland Local, StateandFederalGovernments. ongoing co-operationandassistanceof Upper Hunterandgratefulforthe as amajoremploymentcreatorinthe confident aboutthefutureofzone processes in2001.TheCorporationis commenced planningapproval Chemicals andHunterSpecialtySteels, project proponents,SterlingPulp to welcomingitsfirsttenants.Two Generation IndustryZonemovedcloser It ispleasingtoreportthatMacquarie 13,000 households. enough renewableenergytopower legislation andlastyearweproduced the Commonwealth’s renewables electricity frombiomasscomplieswith electricity production.Therenewable facilities tosupplementcoalin approvedprocessing numberof a useswastewoodfrom develop. It co-firing programcontinuedto Macquarie Generation’s biomass sustain theresult. Our54% accidents intheyearahead,and then goal mustbetoachievezero moving inonthetargetbutour real accidents. We knowwearerapidly committed totheachievement of zero We areasafetyfocusedcompany review ofarrangementsiswelcomed. participants. TheproposedCoAG imposing unnecessaryriskson $10,000/MWh duringthecomingyear the levelofVoLL willmove to not resolvedafterthreeyearsand still lacking,transmissionpricingis for theapprovalofinterconnectorsis Market. Properpolicyandguidelines decisions intheNationalElectricity delay infinalisingcriticalregulatory level ofunfinishedbusinessandthe continue tohaveconcernsatthe On anationalperspectivewe and mostnotablyintoSouthAustralia. overdue inanumberofotherregions Robust interconnectionislong the publicbenefitbroughtbyQNI. particular, therecanbenodoubtof generally andinthesetworegions growth thatwilloccurinthemarket Acknowledging theexpectedload moderation. price Wales viaQNIbycausing South and impactthemarketinNew Chief ExecutiveandManagingDirector Grant Every-Burns have mythanks. these achievements.Onceagainthey results andhaveworkedhardfor Our peopleareproudoflastyear’s enough forMacquarieGeneration. the bestandtherefore,notyetgood worked wasagreatresult,butitisnot year to6.5accidentspermillionhours improvement inworkplacesafetylast

9 (up 44%) (EBIT) of$212.6million(up51.5%) eye-catching resultsincluding: operation yieldedanumberof The Corporation’s sixthyearof was thehighlightofasuccessfulyear. and exceedingkeyexpectationsin2001 system of750MW Once againthebenefitsofmaintainingstandbycapacityandtakingdeliberatemeasurestoreduceCorporation Generation performance, thewaythatMacquarie substantialimprovementinfinancial a While itisalwayspleasingtoreport from additionalsales of$61.5million Corporationbenefitednot only The across south-easternAustralia. Victoria andaveryhotsummer period by someextensiveplantfailures in atightersupplysituationbroughton of Wales increasedby33%asaresult The electricitypoolpriceinNewSouth Rate (improved54.2%) Chief Executive’s Report Net ProfitbeforeTax of$143.2million Revenue of$810.2million(up8.2%) Earnings beforeInterestandTax Safety, LostTime InjuryFrequency Dividend of$100million(up100%) Expenses of$511.8million(down2.3%) 1 ’ s peoplewentaboutdelivering — and inNewSouthWales of275MW measures toreduce theCorporation’s standby capacityandtakingdeliberate Once againthebenefitsofmaintaining at Bayswater. rescheduling ofmajorplannedoutages maintenance spendingatLiddell and environment thatdictatedadditional The resultswereachievedinamarket outage periodwasgreatlyappreciated. capacity duringanextendedBayswater bring thatstationtofullproduction the willingnessofteamsatLiddellto critical timeshasneverbeenbetterand employees totherapidrepairofplantat to ourresults.Thecontributionof Bayswater PowerStationswascentral The performanceatLiddelland the pre-deregulationlevelsof1995. future. Thesepricesarestilllowerthan ensure continuedreliablesupplyinthe the newinvestmentnecessaryto in thepastbutareessentialtounderpin sustainable returnstotheindustrythan They arenotonlybringingmore are importantforanumberofreasons. It mustbesaidthatthehigherprices but alsoreducedcostsof$11.8million. — it isnowonderthatsupplyanddemandtightening. environmental improvement. commitment tocost-effective the Corporationhasastrong usual. Suchprojectsarenotcheap but tonnes peryearoverbusinessas carbon dioxideemissionsof300,000 generating capacityandareductionin Liddell willboastanextra60MWof environmental benefits.By2005, systems willdeliveroperationaland pressure turbinesandoldcontrol Replacement ofthestation’s low life wellintothisnewcentury. upgrade toextenditsusefuleconomic 30thanniversaryofa$72million its Liddell withtheannouncementon We havesignalledourconfidencein newpeakinggeneration. of rapidconstruction are spurringthe thatmarketpressures pleasing tosee Australia andVictoriawhereitis South This isparticularlyevidentin supplyanddemandistightening. that Wales of275MW—itisnowonder of system yearly averageloadgrowthonthe business riskwereconfirmed.Giventhe 750 MW—andinNewSouth ’ s businessriskwereconfirmed.Giventheyearlyaverageloadgrowthon half ourcurrent requirements. million tonnesperyear, whichexceeds rail throughputtoapotentialof 6.5 The plannedmodificationswillincrease conveyor systemsandroadtransport. economic reachofitsoverland of acceptingcoalbeyondthe was formedin1996,ithadnomeans Ravensworth. WhentheCorporation expansion oftherailcoalunloaderat We arenowproceedingwithafurther the economygenerally. concern toelectricityconsumersand competitivelypricedcoalisofvital to Corporation’s continuing access the thedomesticcoalmarket.Clearly, in thereisvibrantcompetition ensuring continues tofocusitsefforton production andtheCorporation significant inputinthermalelectricity The costoffuelremainsthemost greenhouse emissions. operational outcomesandreduce Bayswater inordertoimprove now beingcloselyexaminedat Thermal efficiencyimprovementsare Financial Statements. in Notes1(a),2and3ofthe Explanatory notecanbefound the resultsbetweenyears. Abnormals. Thisnormalises Profit beforeTax and Net 1 Compared with2000 an oversupplysituation inthatregion constructed inQueenslandwillcause capacity beingcommissionedor The largequantitiesofnewgenerating Interconnector (QNI). Queensland toNewSouthWales Market withcommissioningofthe formally joinedtheNationalElectricity In February2001,Queensland Local, StateandFederalGovernments. ongoing co-operationandassistanceof Upper Hunterandgratefulforthe as amajoremploymentcreatorinthe confident aboutthefutureofzone processes in2001.TheCorporationis commenced planningapproval Chemicals andHunterSpecialtySteels, project proponents,SterlingPulp to welcomingitsfirsttenants.Two Generation IndustryZonemovedcloser It ispleasingtoreportthatMacquarie 13,000 households. enough renewableenergytopower legislation andlastyearweproduced the Commonwealth’s renewables electricity frombiomasscomplieswith electricity production.Therenewable facilities tosupplementcoalin approvedprocessing numberof a useswastewoodfrom develop. It co-firing programcontinuedto Macquarie Generation’s biomass sustain theresult. Our54% accidents intheyearahead,and then goal mustbetoachievezero moving inonthetargetbutour real accidents. We knowwearerapidly committed totheachievement of zero We areasafetyfocusedcompany review ofarrangementsiswelcomed. participants. TheproposedCoAG imposing unnecessaryriskson $10,000/MWh duringthecomingyear the levelofVoLL willmove to not resolvedafterthreeyearsand still lacking,transmissionpricingis for theapprovalofinterconnectorsis Market. Properpolicyandguidelines decisions intheNationalElectricity delay infinalisingcriticalregulatory level ofunfinishedbusinessandthe continue tohaveconcernsatthe On anationalperspectivewe and mostnotablyintoSouthAustralia. overdue inanumberofotherregions Robust interconnectionislong the publicbenefitbroughtbyQNI. particular, therecanbenodoubtof generally andinthesetworegions growth thatwilloccurinthemarket Acknowledging theexpectedload moderation. price Wales viaQNIbycausing South and impactthemarketinNew Chief ExecutiveandManagingDirector Grant Every-Burns have mythanks. these achievements.Onceagainthey results andhaveworkedhardfor Our peopleareproudoflastyear’s enough forMacquarieGeneration. the bestandtherefore,notyetgood worked wasagreatresult,butitisnot year to6.5accidentspermillionhours improvement inworkplacesafetylast

9 FOUNDATIONS FOR THE FUTURE— LIDDELL UPGRADE FOUNDATIONS FOR THE FUTURE— RAIL UNLOADER EXPANSION 11

A generation of generation Mines throughout the Hunter region 6.5 million tonnes of coal annually to Stage 1 of the Ravensworth coal $72 million investment in new Liddell Power Station will have greater opportunity to tender Bayswater and Liddell Power Stations unloader was commissioned in started producing 5 This is a sample of copy and for Macquarie Generation coal supply via an integrated conveyor system. October 1999. In stage 2, annual electricity on 17 May 1971 what it will look like. with synchronisation of the contracts following Board approval delivery capacity was upgraded from Macquarie Generation is the largest technology to reduce emissions first 500 MW generating unit. in 2001 for expansion of the 2 million to 3.5 million tonnes in 2000. Its fourth 500 MW unit came customer for Hunter Valley domestic on line in November 1973. Corporation’s coal unloader facility thermal coal, purchasing around $300 at Ravensworth. The LP turbine project and improve capacity million worth annually. is expected to increase Total capital investment in the facility generating capacity to While day-to-day coal consumption is 2060 MW by 2005, making adjacent to the Main Northern Line is Liddell the third largest expected to reach $20 million in 2002. dictated by electricity demand, the Macquarie Generation marked the Based on predicted production levels, The program ranks with the retrofitting The contract for the LP turbine power station in the National Corporation manages a portfolio of Electricity Market. Macquarie 30th anniversary of Liddell Power by 2005 the investment will deliver: in 1994 of a fabric filter system as the replacement has been won by Hitachi The project also includes the leasing Generation’s Bayswater long-term and spot contracts to Station in 2001 with the announcement most significant new investment in Australia Ltd who expect to have the Power Station (2,640 MW) from National Rail of two 48-wagon A reduction of up to 300,000 tonnes ensure timely availability. of new technology investments worth Liddell since commissioning in May 1971. first refurbished Liddell unit operating shares the title of Australia’s trains, with the capacity to deliver per annum in carbon dioxide largest power station. $72 million. by April 2003. emissions; and “The prevailing view at the time was The four-year program involves: that a plant of this size should have a A formal alliance agreement between increased generating capacity of 60 working life of 20-25 years,” says Macquarie Generation, equipment Replacement of Liddell’s four low megawatts without the need for Macquarie Generation Chief Executive, suppliers Yokogawa Australia and Stage 3 development of the pressure (LP) turbines to increase unit additional coal, water or steam. Grant Every-Burns. electrical contractors Ralph M. Lee was efficiency by three per cent ($52 million); The LP turbine replacement attracted “That view has disappeared with the advent signed for the supply and installation of Replacement of Liddell’s analogue the offer of a $5 million Commonwealth of new technologies that are able to deliver a digital Distributed Control System to Ravensworth coal unloader significant improvements in performance generation control systems with digital grant under the Greenhouse Gas operate Liddell’s four 500 MW without the need for expensive structural technology ($20 million). Abatement Program (GGAP). or design changes.” coal/oil/biomass fired units. facility will expand regional supply opportunities FOUNDATIONS FOR THE FUTURE— LIDDELL UPGRADE FOUNDATIONS FOR THE FUTURE— RAIL UNLOADER EXPANSION 11

A generation of generation Mines throughout the Hunter region 6.5 million tonnes of coal annually to Stage 1 of the Ravensworth coal $72 million investment in new Liddell Power Station will have greater opportunity to tender Bayswater and Liddell Power Stations unloader was commissioned in started producing 5 This is a sample of copy and for Macquarie Generation coal supply via an integrated conveyor system. October 1999. In stage 2, annual electricity on 17 May 1971 what it will look like. with synchronisation of the contracts following Board approval delivery capacity was upgraded from Macquarie Generation is the largest technology to reduce emissions first 500 MW generating unit. in 2001 for expansion of the 2 million to 3.5 million tonnes in 2000. Its fourth 500 MW unit came customer for Hunter Valley domestic on line in November 1973. Corporation’s coal unloader facility thermal coal, purchasing around $300 at Ravensworth. The LP turbine project and improve capacity million worth annually. is expected to increase Total capital investment in the facility generating capacity to While day-to-day coal consumption is 2060 MW by 2005, making adjacent to the Main Northern Line is Liddell the third largest expected to reach $20 million in 2002. dictated by electricity demand, the Macquarie Generation marked the Based on predicted production levels, The program ranks with the retrofitting The contract for the LP turbine power station in the National Corporation manages a portfolio of Electricity Market. Macquarie 30th anniversary of Liddell Power by 2005 the investment will deliver: in 1994 of a fabric filter system as the replacement has been won by Hitachi The project also includes the leasing Generation’s Bayswater long-term and spot contracts to Station in 2001 with the announcement most significant new investment in Australia Ltd who expect to have the Power Station (2,640 MW) from National Rail of two 48-wagon A reduction of up to 300,000 tonnes ensure timely availability. of new technology investments worth Liddell since commissioning in May 1971. first refurbished Liddell unit operating shares the title of Australia’s trains, with the capacity to deliver per annum in carbon dioxide largest power station. $72 million. by April 2003. emissions; and “The prevailing view at the time was The four-year program involves: that a plant of this size should have a A formal alliance agreement between increased generating capacity of 60 working life of 20-25 years,” says Macquarie Generation, equipment Replacement of Liddell’s four low megawatts without the need for Macquarie Generation Chief Executive, suppliers Yokogawa Australia and Stage 3 development of the pressure (LP) turbines to increase unit additional coal, water or steam. Grant Every-Burns. electrical contractors Ralph M. Lee was efficiency by three per cent ($52 million); The LP turbine replacement attracted “That view has disappeared with the advent signed for the supply and installation of Replacement of Liddell’s analogue the offer of a $5 million Commonwealth of new technologies that are able to deliver a digital Distributed Control System to Ravensworth coal unloader significant improvements in performance generation control systems with digital grant under the Greenhouse Gas operate Liddell’s four 500 MW without the need for expensive structural technology ($20 million). Abatement Program (GGAP). or design changes.” coal/oil/biomass fired units. facility will expand regional supply opportunities HIGHWAY FLYOVER OLIVE PROCESSING PLANT FOUNDATIONS FOR THE FUTURE— INDUSTRY ZONE FOUNDATIONS FOR THE FUTURE— TOMAGO GAS PLANT 13 ANTIENE ROAD

INTERMODAL HSS SITE TERMINAL

LIDDELL ASH DAM Feasibility studies into the construction Local residents and landowners have Planning approval for the high efficiency Local residents and landowners have been LIDDELL LAKE LIDDELL of an advanced gas-fuelled power plant been invited to participate in the gas-fuelled plant is the first step in a Defying popular perceptions POWER STATION invited to participate in at Tomago, near Newcastle, were development of an Environmental project timetable that will be determined the development of an FRESHWATER DAM Environmental Impact N launched in 2001. Impact Statement (EIS). by factors including the availability of E BAYSWATER W E POWER STATION N Statement (EIS). G L A N D H competitively-priced natural gas, I Industrial land fronting Old Punt Road at The EIS will address issues including noise, G of rural Australia, the Upper H W A Y PIKES GULLY Tomago was identified as the preferred site air quality and traffic movements, particularly ASH DAM FUTURE POTENTIAL electricity demand growth and INDUSTRY SITE for a new plant with the capacity to augment during an 18-month construction phase. electricity generation at peak demand times. government measures in response Hunter is emerging as an A conceptual plan for the Industry Zone The plant, support buildings and to the enhanced greenhouse effect. was released in June 2001. A planning approval process infrastructure will occupy about four commenced in December 2000 economic powerhouse of the 26 hectares of land set aside following a meeting convened by for the project, thereby ensuring low the NSW Department of Urban visual impact. Affairs and Planning and Port Substantial new investment and job domestic and export markets for gas—is the subject of intensifying Macquarie Generation is the owner of Stephens Shire Council. opportunities for the Upper Hunter have been alloyed and stainless steels (340 research as a renewable energy fuel of more than 9,000 hectares of former foreshadowed in new development proposals for the Macquarie Generation Industry Zone. direct jobs). the future. Macquarie Generation has coal mining and grazing land. The projects are not only significant in contracted to take all of the hydrogen Macquarie Generation has received An Industry Zone conceptual plan economic terms for the region and Australia produced by the Sterling plant and is two expressions of interest for projects but also reflect global expectations for more has been released, incorporating the Land near Newcastle well advanced in identifying a number worth an estimated $A750 million on environmentally sensitive industrial responses Sterling Pulp Chemicals and Hunter to consumer demand. of end uses. land adjacent to Bayswater and Liddell Specialty Steels proposals, as well as Power Stations. Sodium chlorate is an industrial salt the potential for an intermodal transport has been selected A key aspect of the Hunter Specialty that is replacing chlorine as a bleaching terminal (road to rail) and a third major State Government planning approvals Steels proposal is the ‘boutique’ mill’s agent in the manufacture of pulp industrial tenant on land developed for are now being sought by: appetite for scrap metal. as the preferred site and paper. the assembly of large items for Canada’s Sterling Pulp Chemicals— The plant will use only scrap metal, Bayswater’s construction. Australia imports around 20,000 tonnes 5 This is a sample of copy and proposing to build a $A95 million re-manufacturing it as made-to-order The Industry Zone is not a conventional for the Corporation’s what it will look like. sodium chlorate plant to service the of sodium chlorate annually. Two-thirds specialty steels using the latest ‘industrial estate’ in that Macquarie Australian and Asia-Pacific pulp and of the proposed Sterling plant’s output technology developed by the German Generation is seeking out industries that paper industries (35 direct jobs); will be exported to Asia where industrial giant, Siemens. first gas-fuelled will complement existing activities and environmentally persistent chlorine is still Hunter Specialty Steels—an Planning approval processes for both infrastructure services. used by pulp and paper makers. Australian/German consortium seeking proposals are in train under NSW power plant to invest $A650 million in a 260,000 tpa The largest by-product of the arrangements defining them as projects electric-arc furnace steel mill to meet manufacturing process—hydrogen of state significance. commercially effectivewayby: environmental impactsina to preventpollutionandminimise facilitiesand activities. its management plansforeachof appropriate environmental Macquarie Generationiscommittedto: employees. all systems andadequatetrainingfor targets, maintainingproperreporting including establishmentofgoalsand by effectiveplanningandmanagement organisation, andcanbeachieved the responsibility ofallindividualswithin good environmentalperformanceisthe Macquarie Generationrecognisesthat environmentalperformance. its Generation aimstocontinuouslyimprove with communityexpectations.Macquarie commercially-effective waythatisconsistent with allapplicableenvironmentallawsina part ofitsbusiness.Itsobjectiveistocomply for environmentalprotectionasanessential Macquarie Generationacceptsresponsibility ENVIRONMENTAL RESPONSIBILITY Environmental PolicyStatement Utilising operatingpracticeswhichseek Developing andmaintaining discharges tothe environment; and minimisingemissions or with aviewtoreducingconsumption efficient useofenergyandresources targets onabiennialbasis. environmental objectives,goalsand itsprogresstowardsachieving and environmental managementsystem formallyreviewthis Policy, andits will expectations, MacquarieGeneration regulatory regimesandcommunity within theframeworkofchanging To ensurecontinuousimprovement relating totheenvironment. groups andthepubliconmatters governments,contractors,industry with organisation aswellconsultation health,safetyortheenvironment. to or othereventswhichposearisk response proceduresforemergencies Facilitating communicationwithinthe Proper environmentalincident ftheimpactofexistingoperations. of regular environmentalassessment and disposal; proper wastehandlingand waste minimisation,recyclingand proper wastemanagementincluding Board AuditCommittee Environmental Auditor Independent and advice information to provide a responsibility represents Dotted line (Environmental Management Liddell PowerStation Staff Training and ENVIRONMENTAL MANAGEMENT SYSTEM Involvement System) Executive Environment Station Environmental Environment Committee) Board Overview (Chairman Executive Chief Executive (Bayswater &Liddell Team Leaders Power Stations) Committee Managers Officers Bayswater PowerStation Emergency Response (Environmental Management Environmental System) and Environment Manager/Fuel Public Affairs Manager atclt atr0.019kg/MWh(Bayswater) 3.834kg/MWh(Liddell) 2.152kg/MWh(Bayswater) 4.822kg/MWh(Bayswater) tonnes 106,333 4,636tonnes 4,263tonnes 12,642tonnes 8,161tonnes Particulate matter 88,697tonnes (expressed asNO2) Oxides ofnitrogen 1 Sulfur dioxide 3 Air Emissions 2 Bayswater (Boilerstart-up) Liddell (Boilerstart-up) Liddell (SupplementaryFuelsProgram) Oils Coal replacedbybiomasstodate Liddell Bayswater Biomass Non-Coal FuelConsumption Incidents requiringexternalassistance Breaches notified Other NSWGovernmentlicencesheld Breaches notified (Bayswater, Liddell,RavensworthCoalUnloader) NSW EPA licencesheld Regulatory Compliance ENVIRONMENTAL RESPONSIBILITY Carbon dioxide Environmental Performance2001 2 3 931.6 kg/MWh(Bayswater) 0.055 kg/MWh(Liddell) 940.3 kg/MWh(Liddell) 4.447 kg/MWh(Liddell) 0 0 1 l s 34,138tonnes 34,668tonnes 1,969 11,910tonnes 1,644ML 6,886tonnes 41,922ML Lime Bottom ash Fly ash By-product sales Land Management Regional minewaterstreated Salinity creditstraded Water/salt discharged Hunter RiverSalinityTrading Scheme. Salt extracted Water diverted(Hunter River) Water Management ysm2,931tonnes 1,506kg Macquarie Generationis: 40ha Tree plantings(commercialtrialswithStateForests) Eels (PlashettDam) Gypsum A foundationmemberoftheCommonwealth Government A partnerintheCommonwealthGovernment Member CleanAir Society ofAustraliaandNewZealand (CASANZ). Member oftheUpperHunterForests SteeringCommittee; Convenor oftheMacquarieGeneration CommunityConsultativeGroup; A memberoftheCoastalValleys Water User A memberoftheHunterRiverCatchment ManagementCommittee; A signatorytotheElectricitySupplyAssociation ofAustralia ’ ’ s CustomerServiceCommittee; s GreenhouseGasAbatementProgram; ’ s GreenhouseChallenge; ’ s CodeofEnvironmentalPractice; 1,792 tonnes consumption minusbiomass 8 September2000 3 2 1 Formulated fromtotalfuel Annual average Biomass stockpilefire

15 commercially effectivewayby: environmental impactsina to preventpollutionandminimise facilitiesand activities. its management plansforeachof appropriate environmental Macquarie Generationiscommittedto: employees. all systems andadequatetrainingfor targets, maintainingproperreporting including establishmentofgoalsand by effectiveplanningandmanagement organisation, andcanbeachieved the responsibility ofallindividualswithin good environmentalperformanceisthe Macquarie Generationrecognisesthat environmentalperformance. its Generation aimstocontinuouslyimprove with communityexpectations.Macquarie commercially-effective waythatisconsistent with allapplicableenvironmentallawsina part ofitsbusiness.Itsobjectiveistocomply for environmentalprotectionasanessential Macquarie Generationacceptsresponsibility ENVIRONMENTAL RESPONSIBILITY Environmental PolicyStatement Utilising operatingpracticeswhichseek Developing andmaintaining discharges tothe environment; and minimisingemissions or with aviewtoreducingconsumption efficient useofenergyandresources targets onabiennialbasis. environmental objectives,goalsand itsprogresstowardsachieving and environmental managementsystem formallyreviewthis Policy, andits will expectations, MacquarieGeneration regulatory regimesandcommunity within theframeworkofchanging To ensurecontinuousimprovement relating totheenvironment. groups andthepubliconmatters governments,contractors,industry with organisation aswellconsultation health,safetyortheenvironment. to or othereventswhichposearisk response proceduresforemergencies Facilitating communicationwithinthe Proper environmentalincident ftheimpactofexistingoperations. of regular environmentalassessment and disposal; proper wastehandlingand waste minimisation,recyclingand proper wastemanagementincluding Board AuditCommittee Environmental Auditor Independent and advice information to provide a responsibility represents Dotted line (Environmental Management Liddell PowerStation Staff Training and ENVIRONMENTAL MANAGEMENT SYSTEM Involvement System) Executive Environment Station Environmental Environment Committee) Board Overview (Chairman Executive Chief Executive (Bayswater &Liddell Team Leaders Power Stations) Committee Managers Officers Bayswater PowerStation Emergency Response (Environmental Management Environmental System) and Environment Manager/Fuel Public Affairs Manager atclt atr0.019kg/MWh(Bayswater) 3.834kg/MWh(Liddell) 2.152kg/MWh(Bayswater) 4.822kg/MWh(Bayswater) tonnes 106,333 4,636tonnes 4,263tonnes 12,642tonnes Carbon dioxide 8,161tonnes Particulate matter 88,697tonnes (expressed asNO2) Oxides ofnitrogen 1 Sulfur dioxide 3 Air Emissions 2 Bayswater (Boilerstart-up) Liddell (Boilerstart-up) Liddell (SupplementaryFuelsProgram) Oils Coal replacedbybiomasstodate Liddell Bayswater Biomass Non-Coal FuelConsumption Incidents requiringexternalassistance Breaches notified Other NSWGovernmentlicencesheld Breaches notified (Bayswater, Liddell,RavensworthCoalUnloader) NSW EPA licencesheld Regulatory Compliance ENVIRONMENTAL RESPONSIBILITY Environmental Performance2001 2 3 931.6 kg/MWh(Bayswater) 0.055 kg/MWh(Liddell) 940.3 kg/MWh(Liddell) 4.447 kg/MWh(Liddell) 0 0 1 ysm2,931tonnes 1,506kg 34,138tonnes 34,668tonnes Macquarie Generationis: 1,969 40ha 11,910tonnes 1,644ML 6,886tonnes 41,922ML Tree plantings(commercialtrialswithStateForests) Eels (PlashettDam) Gypsum Lime Bottom ash Fly ash By-product sales Land Management Regional minewaterstreated Salinity creditstraded Water/salt discharged Hunter RiverSalinityTrading Scheme. Salt extracted Water diverted(Hunter River) Water Management Member CleanAir Society ofAustraliaandNewZealand (CASANZ). Member oftheUpperHunterForests SteeringCommittee; Convenor oftheMacquarieGeneration CommunityConsultativeGroup; A partnerintheCommonwealthGovernment A foundationmemberoftheCommonwealth Government A memberoftheCoastalValleys Water User A memberoftheHunterRiverCatchment ManagementCommittee; A signatorytotheElectricitySupplyAssociation ofAustralia ’ ’ s CustomerServiceCommittee; s GreenhouseGasAbatementProgram; ’ s GreenhouseChallenge; ’ s CodeofEnvironmentalPractice; 1,792 tonnes consumption minusbiomass 8 September2000 3 2 1 Formulated fromtotalfuel Annual average Biomass stockpilefire

15 RENEWABLES— EXPANDING ENERGY PORTFOLIO 17

Macquarie Generation’s 1999 policy refusing native Macquarie Generation continued forest material for electricity production is now reflected in State Government and Federal Government laws. No native development of a diversified forest tree has been or ever will be harvested for Macquarie Generation’s Biomass Co-firing Program. The program renewable energy portfolio in 2001, continues to use sawmill waste for which there is embracing biomass, hydroelectric no economic end use. generation and wind power

In April 2001, a Commonwealth law largest suppliers of renewable energy processing facilities. Its use as a fuel electricity have been produced from Liddell Power Stations from Plashett endorsed the generator’s output Wind speed and direction measured by came into effect mandating the to the National Electricity Market as to produce electricity is an alternative biomass, avoiding the mining and firing Dam, situated between Bayswater and under its Green Power program. an anemometer and two wind vanes on uptake of renewable energy by large the result of a Biomass Co-firing to other forms of disposal including of 88,697 tonnes of coal and the Hunter River. 40m masts are being fed electronically WIND POWER STUDIES electricity users, including Program pioneered in Australia at landfill dumping and on-site burning. production of an equivalent amount of and collated for detailed analysis. Water stored in the 74,000-megalitre The Tumut and Lithgow regions are domestic retailers. Liddell Power Station in 1999. carbon dioxide gas. dam is released to the stations on In 2001, the program delivered 113,038 the subjects of a 12-month study An average wind speed of 6.5 metres more than 200 days per year. By 2010, an additional 9,500 gigawatt Bayswater followed Liddell in 2000 megawatt hours of renewable energy HYDROELECTRIC GENERATION to determine their potential for wind- per second (23 km/h) is widely regarded hours (GWh) of electricity consumed with licence approval to co-fire from the wood (biomass) component Construction of Macquarie Instead of going directly to the stations powered electricity generation. as a benchmark for sustainable wind- in Australia must be obtained from untreated waste wood and coal as a of the fuel blend—the equivalent of Generation’s first hydroelectric via a canal, water will be diverted powered electricity generation. They are the first regions to be renewable sources, as approved by boiler fuel, with a wood component no supplying almost 13,000 households generator commenced in 2001 with through the hydroelectric turbine to investigated by Macquarie Generation As well as experiencing wind speeds the Office of the Renewable greater than five per cent. with renewable energy for one year. commissioning scheduled for 2002. produce electricity. following a comprehensive review favourable for electricity generation, the Energy Regulator. The waste wood is obtained from Since the program started, 176,266 The 800-kilowatt turbine will be driven The NSW Sustainable Energy of available sites throughout Tumut and Lithgow regions are in close Macquarie Generation is one of the licensed sawmills and other wood megawatt hours of renewable by water gravity fed to Bayswater and Development Authority (SEDA) has New South Wales. proximity to major transmission lines.

Most renewable energy comes either directly or indirectly from the sun.

Sunlight causes plants to grow. The organic matter that makes up those plants is known as biomass. Biomass can be used to produce electricity, transportation fuels, or chemicals. The use of biomass for any of these purposes is called bioenergy. Balanced bioenergy consumption and production can deliver endless energy. Supported from start to finish IN THE COMMUNITY 19 by Macquarie Generation, Scone’s Matthew Clark raised $10,000 for CanTeen. The region covered by the five Shires of the Upper Hunter has rightly earned the mantle of the Hunter’s Heartland...

Revitalised confidence in the economic Kosciuszko after completing a 2,000 km conditions (-10° C, 2070 m) at North At 30 June, the Group comprised: Educational facilities future of the Upper Hunter was only journey from the bottom to the top Ramshead, the duo completed the Cr Robyn Tozer (Chair) $9,010 Economic part of the community story in 2001. of Australia. last four kilometres of Aussie Climb Cr Alison Howlett (Deputy Chair) research $11,760 2000 in brilliant sunshine on 29 July. Cr Warren Cook While welcoming new investment and The 16-year-old set out in a kayak Cr John Silcock the prospect of long-term jobs growth, from Belt Bay (Lake Eyre:—17 m) on Supported from start to finish by Community events/activities Mrs Carol Russell $45,524 the community also let it be known that 3 July, with the aim of reaching the Macquarie Generation, Matthew Welfare/medical Mr Tony Laffan research it regards complementary investment in summit of Mt Kosciuszko (2,229 m) raised $10,000 for CanTeen. $18,880 Mrs Lyn MacBain social infrastructure as a priority. in just 17 days. Community Consultation Mrs Ros Bull Averaging 124 km a day on the cycle Macquarie Generation was pleased to Mrs Lisa Gowing leg from the shores of Lake Eyre to the The Macquarie Generation Civic amenities play a part through its Community $25,069 Thredbo Kosciuszko Resort, Matthew’s Community Consultative Group On 13 November 2000, the founding Program in enhancing the provision of Sporting activities/facilities continued to provide the Corporation timetable was frustrated by blizzards Chair of the Group, Mr Greg $34,048 services and amenities and supporting with valuable input in 2001. that hit the Snowy Mountains. Thompson, of Muswellbrook, died a range of community events. Determined to complete his The Group was formed in 1998 from injuries sustained in a car Young Adventurer fundraising trek on behalf of the and has convened 18 times, accident. Macquarie Generation Few events in 2001 surpassed the teenage cancer support group, with particular reference to the wishes to place on record its gratitude efforts of Scone teenager Matthew CanTeen, Matthew and his father Supplementary Fuels Program at for his contribution to the community COMMUNITY CONTRIBUTIONS 2001 Clark. Matthew wrote his name into the Robert returned to the mountain on 28 Liddell Power Station. The Group and extends its deepest sympathy to record books at the summit of Mt July. Camping overnight in sub-zero met three times in 2001. his family and many friends. development of a commercial been historicalobstacles tothe Low rainfallandmarginalsoilshave and minesites. 40 hectaresofformeragricultural land treatments arebeingtestedacross different wasteandby-product Six eucalypttreespeciesandseven trials nearBayswaterPowerStation. Hunter withpromisingresultsfromplantation the tree-carryingcapacityofUpper NSW arechallengingtraditionalviewsabout Macquarie GenerationandStateForestsof firefighting competition. finished withsilverandbronzeinthe in thefirstaidteamssectionand and Bayswatercompletedaquinella Power StationnearLithgow, Liddell Industry GamesatWallerawang Competing attheannualPower best forthethirdconsecutiveyearin2001. aid teamsretainedtheirtitleastheState Macquarie Generation Tree PlantingTrials Safety Winners ’ s firefightingandfirst ’ s inter-industry titleforhisfirstaidskills. event. Glenalsowentontowinan first andsecondintheindividualaid established plantation regions. already matching thegrowthratesfrom After 12months,someplantings are rehabilitation andanewindustry. ingredients foracceleratedland gypsum maydelivertheright products suchasash,limeand biosolids andpowerstationby- supported bymixesofcompost, However, improvedtreespecies Upper Hunter. hardwood plantationindustryinthe Bayswater Liddell for The Gameswereapersonaltriumph overall pointstally. Generation toaresoundingwininthe The performancestookMacquarie ’ s GlenCousin(pictured)and ’ s PeterWalkling, whofinished providing constantchallenges. scenarios withcoached First aidcompetitionsfeaturepractical Trust funding. is alsosupportedbyNaturalHeritage monitoring thethree-yeartrial,which part oftheteammanagingand State Forests ’ AndrewSimpsonis ‘ casualties ’ 8am Business Hours 61 249687433 61 249687489 Facsimile 61 249687499 Telephone AUSTRALIA HAMILTON DCNSW2303 PO Box3416 Postal Address LAMBTON NSW2299 34 GriffithsRoad Corporate Office Macquarie Generation CORPORATE CONTACT DETAILS – 5pm MondaytoFriday 8am Administration Business Hours 61 265420711 Telephone AUSTRALIA MUSWELLBROOK NSW2333 Private MailBag2 Postal Address MUSWELLBROOK NSW2333 New EnglandHighway, Liddell PowerStation Power Station Bayswater – 4pm MondaytoFriday [email protected] Email www.macgen.com.au Web siteaddress 24 hours7days Security andOperations

21 firefighting competition. finished withsilverandbronzeinthe in thefirstaidteamssectionand and Bayswatercompletedaquinella Power StationnearLithgow, Liddell Industry GamesatWallerawang Competing attheannualPower best forthethirdconsecutiveyearin2001. aid teamsretainedtheirtitleastheState development of a commercial been historicalobstacles tothe Low rainfallandmarginalsoilshave and minesites. 40 hectaresofformeragricultural land treatments arebeingtestedacross different wasteandby-product Six eucalypttreespeciesandseven trials nearBayswaterPowerStation. Hunter withpromisingresultsfromplantation the tree-carryingcapacityofUpper NSW arechallengingtraditionalviewsabout Macquarie GenerationandStateForestsof Macquarie Generation Tree PlantingTrials Safety Winners ’ s firefightingandfirst ’ s inter-industry titleforhisfirstaidskills. event. Glenalsowentontowinan first andsecondintheindividualaid o Liddell for The Gameswereapersonaltriumph overall pointstally. Generation toaresoundingwininthe The performancestookMacquarie Bayswater established plantation regions. already matching thegrowthratesfrom After 12months,someplantings are rehabilitation andanewindustry. ingredients foracceleratedland gypsum maydelivertheright products suchasash,limeand biosolids andpowerstationby- supported bymixesofcompost, However, improvedtreespecies Upper Hunter. hardwood plantationindustryinthe ’ s GlenCousin(pictured)and ’ s PeterWalkling, whofinished scenarios withcoached First aidcompetitionsfeaturepractical providing constantchallenges. Trust funding. is alsosupportedbyNaturalHeritage monitoring thethree-yeartrial,which part oftheteammanagingand State Forests ’ AndrewSimpsonis ‘ casualties ’ 8am Business Hours 61 249687433 61 249687489 Facsimile 61 249687499 Telephone AUSTRALIA HAMILTON DCNSW2303 PO Box3416 Postal Address LAMBTON NSW2299 34 GriffithsRoad Corporate Office Macquarie Generation CORPORATE CONTACT DETAILS – 5pm MondaytoFriday 8am Administration Business Hours 61 265420711 Telephone AUSTRALIA MUSWELLBROOK NSW2333 Private MailBag2 Postal Address MUSWELLBROOK NSW2333 New EnglandHighway, Liddell PowerStation Power Station Bayswater – 4pm MondaytoFriday [email protected] Email www.macgen.com.au Web siteaddress 24 hours7days Security andOperations