adapt sustain depend able

Annual Report 2008/09 contents

Highlights 2 Profile 4 Financial Overview 8 adaptable Chairman’s Review 10 Chief Executive’s Review 12 Powerlink continually interacts with government, the energy Powerlink and the National Electricity Market 14 sector, customers and the community to develop its network Network Strategy and Operations 20 to meet Queensland’s and Australia’s changing needs. Network Development 28 Environment 38 Community 46 People 52 Corporate Governance 58

Board of Directors 64 Executive Leadership Team 66 sustainable Directors’ Report 70 Powerlink works closely with the community and specialist Financials 75 advisors to manage its operations in ways that are Statistical Summary 128 environmentally and economically sustainable. Index 132 Glossary and Terms of Measurement 134 dependable Front cover: John Burgess, Field Test Engineering Officer Powerlink’s best-practice systems and dedicated workforce Inside front cover: Adam Hammersley, Assistant Construction Manager, and Lloyd Warr, Lead Line Construction Manager, supervise helicopter stringing of the South Pine to ensure its transmission network is amongst the most reliable Sandgate transmission line in Brisbane and cost effective in the world. Powerlink’s 2008/09 highlights Powerlink Queensland is committed to delivering transmission network and mission related services at world-class levels of safety, reliability and cost effectiveness.

To be the leading Transmission Network Service Provider vision in Australia, and one of the best in the world.

Reasonable returns for our owners. values Value for money services to our customers. deliverable The wellbeing of our employees. Being a good corporate citizen and community recognition of this. Fair, commercial and courteous dealings with our suppliers.

In the 2008 calendar year, Powerlink’s Powerlink’s robust planning Powerlink Queensland network reliably met or exceeded the processes took account of the Annual Report 2008/09 targets set by the Australian Energy changes in the economic climate Regulator (see page 18). and the implications of the This Annual Report is designed Commonwealth and State Powerlink’s high voltage network to give an understanding of our Governments’ climate change policies reliably handled a record peak operations and finances in 2008/09 (see page 18). and provide an overview of our summer electricity demand of plans for the immediate future. 8,677 megawatts reached in We completed construction works to We present this Report to our February 2009 (see page 20). connect three power stations to the grid, including two low emissions, two shareholding Ministers, the We undertook $675 million gas-fired generators in South West Queensland Treasurer and Minister in construction works across for Employment and Economic Queensland (see page 19). Queensland in 2008/09, ensuring Development, and the Queensland that we are on target to invest about We launched our new $1.3 million Minister for Natural Resources, $2.9 billion over the five-year period Mines and Energy and Minister for Powerlink GreenWorks program to Trade. The Report is also designed to 2013/14 to develop the Queensland provide funding for environmental to give the Queensland community transmission grid (see page 28). projects in the vicinity of the proposed 500 kilovolt transmission network an insight into our operations and to $73.3 million was invested in (see page 48). update our partners and stakeholders the maintenance of the network in the electricity industry. (see page 24). Through our involvement with This Report has been prepared in Grid Australia, Powerlink took a All of this work was delivered accordance with the provisions of proactive role in shaping the future at very high levels of safety and the Government Owned Corporations of the National Electricity Market by environmental management. Act 1993 and the Financial preparing submissions on a range of Administration Act 1977 and is Planning and approvals for the regulatory and market development presented to the Legislative new 500 kilovolt transmission network matters (see page 16). Assembly of Queensland. to reinforce electricity supply for We have implemented a number This Annual Report is available on South East Queensland, the largest of initiatives to reduce our in-house line at www.powerlink.com.au and electricity load centre in the State, greenhouse emissions by actively further copies can be obtained from: were progressed on schedule targeting waste, energy, water, (see page 30). Manager Corporate Communications transport, and emissions inventories. Powerlink Queensland (see more on page 40). PO Box 1193 Virginia Queensland Australia 4014. Phone +61 7 3860 2111

Cairns Central Business District

2 powerlink annual report 2008/09 powerlink annual report 2008/09 3 Powerlink profile

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Powerlink owns, operates and develops Queensland’s world-class high voltage electricity transmission network, which transports electricity in bulk from power generators to the regional distributors and directly to some large industrial customers. Powerlink’s $5.2 billion network extends 1,700 kilometres from north of Cairns to the New South Wales border where it links to the national electricity grid, which underpins the National Electricity Market (NEM). We harness a wide range of management, technical and support skills to operate a network that achieves world’s best practice in terms of both reliability and cost efficiency for our customers.

Who we are What we do environmental impact assessments Powerlink is a Queensland Government- Our primary business activities include: and the related community Owned Corporation established in consultation, maintaining the operating the transmission network 1995 under the Government Owned transmission network, including on a 24/7 basis, by monitoring Corporations (GOC) Act 1993. monitoring the condition of network electricity flows across the network components and replacing them We are a regulated monopoly to ensure it operates in an efficient, at the optimum time to ensure business responsible for ensuring secure and stable manner, and by very high levels of reliability the transmission network reliably responding to any unplanned meets Queensland’s electricity needs, outages quickly and safely non-regulated business activities, anticipates future growth and also including connecting new power developing and extending the meets its responsibilities in the NEM. generators and large industrial transmission network in a timely customers to the grid and providing The major proportion of our revenue manner, taking into account forecast transformer oil testing services to is determined by an independent population and economic growth, the industry national economic regulator, the changing regional needs and other Australian Energy Regulator (AER). factors, including energy efficiency contributing to the development Some revenue comes from the initiatives, which affect demand. of the NEM to further the National provision of non-regulated transmission This long-term planning also involves Electricity Objective – to promote an network-related services in accordance the strategic acquisition of easements efficient, reliable and safe electricity with the National Electricity Rules to provide long-term certainty for supply for the long-term interests of (the Rules). land use planning, and the associated Australian consumers. Powerlink goes the distance environmental impact assessments Read more about our corporate Powerlink does not buy or sell electricity and community consultation in every way to ensure our governance and legislative framework – we operate our transmission system on page 58. to transfer electricity in bulk from power stations to the distribution networks. transmission network reliably meets the fastest-growing electricity demand in the Michael Craperi, Line Inspector, during easement scoping works for the proposed Yabulu South to Ingham replacement transmission line National Electricity Market.

4 powerlink annual report 2008/09 powerlink annual report 2008/09 5 Powerlink profile working together to power Queensland

A number of different organisations and corporations are involved in electricity supply in Queensland. This diagram shows where Powerlink fits into the broader structure.

Powerlink by numbers AUSTRALIAN ENERGY AUSTRALIAN ENERGY AUSTRALIAN ENERGY MARKET COMMISSION MARKET OPERATOR REGULATOR (AER) (AEMC) (AEMO) Administers the National A statutory commission Operates the National Electricity Rules and responsible for developing Electricity Market and manages makes regulated revenue the rules for the National power system security determinations for More than 13,000 circuit kilometres of high Electricity Market and for monopoly networks market development voltage transmission network

Transmission lines operating at 110 kilovolts, 132 kilovolts, POWER GENERATORS including: 275 kilovolts and 330 kilovolts coal-fired gas-fired renewable (hydro, wind, biomass) 1 0 9 substations

Providing the backbone of the electricity supply chain for more HIGH VOLTAGE LARGE INDUSTRIAL TRANSMISSION GRID CUSTOMERS including: than 1.8 million electricity consumers in Queensland Bulk transport of electricity aluminium smelters POWERLINK coal mines rail Connecting 22 customers to the grid, including the distribution networks and large industrial customers DISTRIBUTORS Queensland Electricity Deliver electricity to consumer premises Transmission Network Transporting about 50,000 gigawatt hours of energy per year ENERGEX ERGON ENERGY

A workforce of around employees (Qld, NSW, Vic, SA, Tas) 1,000 Cairns ELECTRICITY RETAILERS Townsville Sell electricity to consumers and issue Consistently benchmarked in the top quartile of electricity accounts Mackay international transmission companies in terms of both Queensland network reliability and cost efficiency Gladstone

CENTRAL, WEST SOUTH EAST AND NORTH Brisbane QUEENSLAND QUEENSLAND HOMES AND The people featured throughout this Annual Report are HOMES AND BUSINESS

part of Powerlink’s dedicated workforce. See who they are and what TRANSMISSIONNATIONAL GRID BUSINESSES they do on the Acknowledgements page at the end of this report.

As at 30 June 2009.

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Powerlink’s success in deploying new technologies and innovative solutions has been a key contributor financial overview to delivering cost efficiency.

Borrowings With total debt now just over Financial indicators summary To finance the capital works $3 billion, business gearing (Debt The following table summarises the key Leaders in cost efficiency program, Powerlink borrowed a to Fixed Assets) has increased to financial and non-financial indicators as Powerlink continues to be one of the most cost efficient Transmission Network Service total of $522 million in 2008/09, 58.2 per cent, up from 54.7 per cent incorporated in Powerlink’s Statement in the previous financial year. Providers in Australia and the world, as evidenced by international benchmarking. supplementing internally generated of Corporate Intent, which is used to funds. This borrowing program to This is consistent with the benchmark monitor and measure our performance. fund Powerlink’s capital investment regulatory gearing of 60 per cent requirements has resulted in a modest for regulated electricity transmission A key measure adopted by Powerlink This investment, consistent with Business profitability increase in gearing. network businesses. in measuring its cost efficiency is regulatory capital expenditure Powerlink’s profitability (Earnings Before controllable annual operating costs allowances, reflects Powerlink’s Interest and Tax or EBIT) for 2008/09 as a percentage of asset value, which continued focus on developing the was $355.9 million, an increase of Financial Indicators 2006/07 2007/08 2008/09 is now 1.8 per cent. This is a solid transmission grid in Queensland and 18 per cent over the previous financial $MILLION $MILLION $MILLION achievement in a business environment replacing assets at the end of their year. This was mainly attributable to with more complex and onerous service life to ensure ongoing reliability higher regulated revenue, in line Revenue Grid Services 531.4 561.3 633.6 regulatory and legislative obligations and of bulk electricity supply as the with the regulatory determination, Total Revenue 583.9 611.6 682.8 requirements, and increasing input costs. demand for electricity grows. Powerlink’s regulatory service Operating Expenses 293.1 313.7 326.9 It demonstrates Powerlink’s ability to standard performance bonus, and Revenue Earnings Before Interest and Tax (EBIT) 290.8 297.9 355.9 adopt and implement efficient business new non-regulated transmission practices and processes. Almost 90 per cent, $604.4 million, network connections. Net Profit After Tax (NPAT) 115.8 103.1 121.9 of Powerlink’s total revenue is derived The corporation’s success in Capital Works Expenditure 583.5 676.5 675.0 from providing regulated transmission After interest and tax, a dividend deploying new technologies and Dividend Proposed/Paid 92.6 84.4 98.8 network services. of $98.8 million was provided for in innovative solutions has been a key 2008/09, in accordance with the Board’s % % % contributor to delivering cost efficiency. By exceeding the network reliability approved 80 per cent dividend payout Powerlink pursues and promotes targets in the Australian Energy ratio. This represents a 17 per cent Dividend Payout Ratio 80 80 80 operational excellence across Regulator’s (AER) service standard increase over the previous year, and Return on Total Assets (ROA) 7.5 6.6 6.9 performance incentive scheme, the business. is in line with the improved EBIT result Return on Average Equity – Post Tax 7.4 6.1 6.8 Powerlink achieved a $2.2 million for the year. Asset investment service standard performance bonus Debt/Debt + Equity Ratio 55.4 58.9 62.1 The value of Powerlink’s total property, for the 2008 calendar year. This is Capital expenditure Debt/Fixed Assets Ratio 51.3 54.7 58.2 plant and equipment now exceeds included in Powerlink’s reported Powerlink has approximately $1.6 billion Interest Cover – EBIT (times) 2.5 2.0 2.0 $5 billion ($5.2 billion at 30 June 2009). regulated revenue for 2008/09. of approved capital works under way, Interest Cover – EBITDA (times) 3.8 3.1 2.9 Capital investment remains at all-time Powerlink’s other revenue of $78 million which includes the construction if highs, with expenditure in 2008/09 SYSTEM PERFORMANCE INDICATORS in 2008/09 is derived from providing several new transmission lines to totalling $675 million. At the completion non-regulated transmission network maintain high reliability to customers Energy Flowing into the Grid (GWh) 47,750 48,576 49,104 of 2008/09, Powerlink’s network connections, distributions from as Queensland’s electricity demand Energy Delivered to Customers (GWh) 46,025 46,083 47,904 included 13,106 circuit kilometres Powerlink’s investment in ElectraNet continues to grow. The electricity of transmission lines. Peak Maximum Demand (MW) 8,589 8,082 8,677 SA, interest revenue and other demand growth in Queensland Loss of Supply Events > 0.2 System Minutes 2 3 3 non-regulated activities. continues to exceed the national average by a factor of almost two. Loss of Supply Events > 1.0 System Minutes 1 1 1

Capital expenditure in 2008/09 totalled SAFETY INDICATORS $675 million, at the same level as Lost Time Calculation (LTC) 0.3 1.3 0.1 the previous financial year, which represented an all-time high since Powerlink’s inception in 1995.

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Powerlink’s Chief Operating Officer, Powerlink’s continuing investment Acknowledging our Directors Simon Bartlett, is the Chairman of in environmental research and I also thank my fellow Directors for the Australian Power Institute and the development of more sustainable their time and dedication to Powerlink’s is dedicated to enhancing power construction and maintenance continuing success. Their integrity, In a year of global and national change, engineering education and technical methods also contribute to protecting insight and strategic direction are Powerlink has remained focused on its innovation. It was therefore a pleasure and enhancing the flora, fauna fundamental to the corporation’s to see Simon recognised at the Institute and landscape of areas where balanced operational focus and to core business of developing, operating of Engineering and Technology awards we have infrastructure. the value placed on attaining good in July 2008 where he received the outcomes for all of our stakeholders. and maintaining a cost-effective and reliable Institute’s highest honour, the Sir Lionel The power of working together In October 2008, we welcomed a transmission network for Queensland. Hooke Award. Simon also received Powerlink has a highly skilled and the prestigious accolade of Australian capable workforce, with experts new Director, Dr Julie Beeby, to the We have continued to invest in Queensland’s Professional Electrical Engineer of 2009 in many fields including electrical Powerlink Board following the presented by Engineers Australia. engineering, telecommunications, retirement of long-serving Board future through our large capital works program, information technology, environmental Member, Merv Norman. Dr Beeby is Sustainable community relationships science and management disciplines. General Manager, Strategic Planning and keeping pace with Queensland’s long-term Powerlink aims to foster long-term Projects for Peabody Pacific where her Effective dialogue between the relationships with our stakeholders key responsibilities include engineering electricity demand growth, which is the different specialities is leading to throughout the planning, development and technical services, environmental innovative and effective solutions to highest in the National Electricity Market. and maintenance of our network management, new projects, government challenges and a genuine culture of to deliver outcomes that benefit affairs and public relations. She brings continuous improvement. communities and the environments near 20 years experience in sectors that our assets. We have been undertaking Our workforce has continued to share many of Powerlink’s challenges. major environmental projects in various grow in 2008/09 in response to the We all look forward with locations throughout Queensland demands of the large capital works and confidence to 2009/10 as Powerlink for several years. maintenance program. continues to deliver outstanding Powerlink’s performance in While the economic slowdown is Industry involvement and recognition In 2008 we introduced our new flagship On behalf of the Board, I thank business performance. 2008/09 was again very strong. expected to lead to below-trend peak Powerlink has an international GreenWorks program, which will invest all employees for their valuable electricity demand growth in the next $1.3 million over the next four years in contribution in 2008/09 and applaud Our Net Profit After Tax of reputation for innovative and effective two years, our forecasts show a return areas of South Queensland where their many achievements, both the $121.9 million in 2008/09, higher than engineering solutions. Our long-term to the long-term trend growth we have easements for the future visible ones outlined in this Annual our profit in the last financial period, performance depends on well-qualified thereafter. Queensland’s electricity construction of the new 500 kilovolt Report and the unsung contributions was driven by additional revenue from engineering and technical staff, ready Else Shepherd AM needs continue to grow faster than transmission network. to the network’s cost effectiveness and non-regulated sources, combined with to meet the challenges of tomorrow. Chairman those of the other states in the National reliability, which are amongst the best our focus on cost efficiency. For this reason, Powerlink was a The 2008/09 financial year also Electricity Market. This forecast growth in the world. founding member of the Australian saw the completion of our five-year The Board is proud of Powerlink’s will continue to drive our medium-term Power Institute, the driving force Greening Lockyer program. Its success highly skilled and dedicated workforce to long-term plans, with our capital behind a broad program of initiatives has been recognised with several major that delivers this enviable business expenditure for the next five years supported by the Australian power awards during the life the program. performance and the organisation’s (from 2009/10 to 2013/14) expected industry and leading universities to proactive environmental work, and to be around $3 billion. ensure Australia has a sustainable community and stakeholder As well as new lines and substations, supply of highly skilled power engineers relationships. this investment also includes the into the future. One of these initiatives is a national undergraduate bursary Investing in Queensland’s future replacement of assets which are reaching the end of their service program which currently supports Powerlink invested $675 million in life. We also invest in the routine 180 bursary recipients. its capital works program in 2008/09 maintenance of our assets to ensure to upgrade and extend the network the highest levels of reliability. to meet Queensland’s growing electricity needs.

10 powerlink annual report 2008/09 powerlink annual report 2008/09 11 Chief Executive’s review

the replacement of our existing Our teams worked closely with In accordance with the Integrated West Darra Substation to ensure these generation development Planning Act 1997, our transmission a continued reliability of supply to proponents, completing the works route planning is subject to a the South West Brisbane area required to connect these power comprehensive process of assessment stations to the grid. Two of these power and approval which includes extensive the installation of three new stations were gas-fired power stations community consultation. Static VAr Compensators at our in South West Queensland – Origin Woolooga, Greenbank and South We also strive to be a good corporate Energy’s Darling Downs Power Station Powerlink’s high voltage transmission Pine substations to optimise the citizen, working hard to give something and ERM Power’s and Arrow Energy’s transmission capacity of the grid. back to the communities where we are network provides the backbone for the Braemar 2 Power Station. In line with constructing our network. Powerlink’s We also continued to plan and carry out this generation shift, the number of multi-tiered approach to working electricity supply chain, and in 2008/09 we the environmental assessment, related generation connection enquiries rose with communities continues to deliver community consultations and regulatory again in the financial period. have continued to deliver on our strong far-reaching benefits to us and to the approval processes for the construction With the quality renewable energy communities in the vicinity of our track record of cost-effective and reliable of the new 500 kilovolt network to resources in Queensland being located infrastructure. These benefits range transfer power from the generation-rich away from the major population centres, from the proactive working relationships transmission services to Queenslanders. Surat Basin to the growing South East the transmission grid will play a pivotal we foster with individual landowners, to Queensland region. role in the transition to a lower our Community Benefits Program which With $1.6 billion in capital projects emissions generation mix. provides funding for community projects approved and under way as we enter in areas where we are building new To this end, we continue to work 2009/10, this pattern of timely infrastructure, to our major goodwill closely with the Queensland investment in the transmission grid programs such as the recently completed Government’s Office of Clean Energy will continue to benefit Queensland Greening Lockyer program in South to identify grid locations which can well into the future. Queensland and the Community provide economic connection for large Environment Fund in Townsville. scale renewables generators (wind, This year, we completed construction The transmission grid will also play a a new substation at Townsville World-class performance biomass, solar thermal, and geothermal). of a total of 504 kilometres of pivotal, facilitative role in Australia’s and East and a new transmission line Powerlink continues to be a consistent Valuing our people transmission lines as part of our Queensland’s transition to a lower connecting this substation to our provider of reliable, cost-effective Environment and Individually, and collectively, our people five-year, $2.9 billion capital program emissions generation mix in response existing substation at Townsville transmission services, positioning community priorities help Powerlink to maintain and deliver Queensland as Australia’s and one – the largest in Australia’s electricity to emerging climate change polices. South to meet growing demand in Our commitment to sustainable transmission services which meet the of the world’s leaders in the efficient transmission sector. In delivering this As the State Government’s Queensland the Townsville CBD and port area environmental management and expectations of our major stakeholders. program, we continued to monitor Renewable Energy Plan identifies, the development and operation of a new transmission line between to positive and lasting community I thank our people for their commitment and respond to the challenges of a quality renewables energy resources electricity transmission infrastructure. Broadsound and Nebo, the first stage relationships remains a priority as to getting the job done safely. changing economic and regulatory in Queensland are located away from Powerlink’s network performance met of the three-stage project to reinforce we deliver our record capital Their consistent efforts have once environment, and Government the major population centres, and or exceeded the performance targets electricity supply to North Queensland works program. again enabled Powerlink to achieve climate change policies. Powerlink’s grid will be required to set by the Australian Energy Regulator. another year of excellent performance. transport the electricity from the new a new transmission line from We continue to maintain rigorous Notwithstanding the short-term Further, the high standards we attain in renewables generators to consumers. Powerlink’s Nebo Substation processes for monitoring all of our economic slowdown, the Queensland the everyday operation and maintenance Looking to the future to connect to QR Network’s construction activities to ensure transmission grid continues to be Powerlink will readily handle these of the transmission network were tested Powerlink will continue to develop its Bolingbroke Substation compliance with environmental and proven with the network reliably network ahead of the growing electricity planned and developed based on changes to the generation mix within legislation, and to fulfil our commitment a new substation at Oakey to ensure meeting the new record statewide demand in Queensland. We will continue long-term trends in electricity demand our existing planning processes. to environmentally responsible the continued reliability of supply to peak electricity demand (as generated) to operate and maintain our network to growth, which are expected to continue performance. In addition, we have Building for the future the Oakey region of 8,677 megawatts reached in world-class levels of safety, reliability and in Queensland due to population undertaken a number of initiatives to growth and economic development. In 2008/09, we continued our February 2009. cost efficiency. a new substation at El Arish to ensure reduce and offset greenhouse emissions substantial capital works program, Powerlink continued to have a voice in the continued reliability of supply to produced in-house within Powerlink, by investing $675 million in the Changing climate the development of Australia’s electricity the Mission Beach region actively managing waste, energy, water, development of our network across the for electricity generation market through our active involvement transport, and emissions inventories. State ahead of rising electricity demand. a new substation at Abermain Queensland is already witnessing with Grid Australia, the organisation in Brisbane’s west to ensure the a gradual shift toward a lower emissions As the provider of an essential service, that represents the owners of Australia’s Projects which were completed and continued reliability of supply to generation mix in response to the we serve the entire Queensland Gordon Jardine electricity transmission networks. commissioned in 2008/09 included: the Ipswich area Government’s climate change policies. community by developing and operating Chief Executive the new Tully to Innisfail transmission Powerlink is playing a pivotal role in the State’s transmission network. line as a replacement for the aged facilitating this shift, working with Kareeya to Innisfail transmission line power generators to connect three new, low emissions generators to our grid in 2008/09.

12 powerlink annual report 2008/09 powerlink annual report 2008/09 13 Powerlink and the National Electricity Market Powerlink takes an active role in initiatives to help define the future of Australia’s energy supply. dependable

Powerlink is a Transmission Network Service Provider in the National Electricity Market (NEM), and is regulated by the Australian Energy Regulator.

Powerlink is required to efficiently As required by the Australian Energy deliverable 2008/09 plan, develop, operate and Regulator’s (AER) Regulatory Test, we maintain Queensland’s high voltage identify and implement the solution that Network reliability met or transmission network and provide meets reliability standards at the lowest exceeded the performance all NEM participants with secure, open long-run cost to consumers. targets set by the Australian and non-discriminatory access to our The AER is responsible for setting the Energy Regulator, and network for the trade of electricity. revenues that Powerlink is allowed to benchmarked in the top quartile internationally. During this period, the National earn from regulated transmission Electricity Market Management services and it also sets targets for Powerlink commenced Company (NEMMCO) managed the network reliability. The AER is a construction works to connect operation of the NEM in accordance constituent part of the Australian three power stations to the with the National Electricity Rules. Competition and Consumer grid – Braemar 2 Power Station, Under an Operating Agreement Commission (ACCC), but operates Darling Downs Power Station with NEMMCO, Powerlink performs as a separate legal entity with and Mount Stuart Power several functions that assist in the responsibility that includes economic Station Number 3. secure operation of the Queensland regulation of electricity transmission. Through Grid Australia, power system. Powerlink continued to play Changes to the Powerlink also performs the a proactive role in helping to National Electricity Market shape the future of the National Jurisdictional Planning role for During 2008/09, Powerlink has been Electricity Market by preparing Queensland. In this role, we assess preparing for changes in the way the submissions on a range of issues the capability of the network to meet NEM is managed in Australia. including the Australian Energy forecast load growth, and work with Market Commission’s Review equivalent bodies in other States and From 1 July 2009, the Australian Energy of Energy Market Frameworks NEMMCO to assess the capability to Market took the place of the NEM and in the Light of Climate transfer electricity to and from other the Australian Energy Market Operator Change Policies. States in the NEM. (AEMO) took over the responsibilities previously held by NEMMCO and a We began working with the When we identify future electricity number of other energy market entities. Queensland Government to needs, we consult with NEM participants identify locations where the and interested parties through a (continues overleaf) grid could provide economic transparent process to identify potential connection for large scale non-network solutions and compare renewables generators such them with the network solutions as wind or solar thermal. Powerlink has identified.

The transmission connection to Origin Energy’s Darling Downs Power Station

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connectable: Connecting Origin Energy’s new Darling Downs Power Station

Powerlink is playing its part in helping At the project concept stage, after initial “The final connection arrangement features Queensland move to a lower emissions contact from a generator, Powerlink industry best-practice configurations generation mix, connecting Australia’s provides advice on cost-effective giving Origin Energy high levels of largest gas-fired power station to the connection locations and options. Scoping reliability and security,” Simon said. grid in South West Queensland. and costing the entire connection project is complex and extensive discussions are “This project moved into its construction Powerlink has been working with Origin carried out with the generator to finalise phase in 2007/08, with a team of upwards Energy to connect its new power station contractual arrangements. of 20 Powerlink staff working to complete to the grid. The 630 megawatt gas-fired the connection works in 2008/09.” Darling Downs Power Station is the “We are pleased to largest combined-cycle power station in As the financial year drew to a close, Australia and will produce enough power have worked with Origin the project entered the testing and to supply the equivalent of 400,000 Energy to help deliver commissioning stage. Queensland homes. Compared with this significant, lower Throughout the project, Powerlink the same capacity coal-fired power emissions energy project. maintained flexibility to work in with the station, it will save 2.5 million tonnes client’s construction schedule, reviewing of greenhouse gases a year, and will use Our combined commitment logistics planning and staffing schedules. less than three per cent of the water to best-practice standards needed by a conventional water-cooled “Good communication and the strong power station. has delivered a project that relationship that has evolved between is an asset for the State.” Powerlink and Origin Energy have enabled Powerlink’s works to connect Darling both organisations to successfully Downs Power Station have involved a Simon Taylor, Network Customers Manager negotiate the challenges of such a complex, large and diverse team from across the multi-faceted project,” Simon said. organisation and have called for high levels Powerlink’s Network Customers of planning, collaboration, coordination Manager, Simon Taylor, said Powerlink Powerlink has delivered the connection and engineering expertise to meet the was contracted to construct, own and ahead of schedule. The Darling Downs customer’s needs. maintain the infrastructure connecting Power Station is due to be commissioned the new power station to Powerlink’s in the fourth quarter of 2009 and will Albert Chown, Origin Energy’s Commissioning Braemar Substation. ramp up to full commercial operation Manager, with Simon Taylor, Powerlink’s in the first quarter of 2010. Network Customers Manager, at Darling Downs Power Station

(continued from page 14) Helping shape the future of the NEM Powerlink undertakes much of its During 2008/09, Powerlink participated, Australian Energy Regulator (AER) More details of these and other AEMO will also undertake the new Powerlink continued to take an active engagement in this area through its both directly and through Grid Australia, Weighted Average Cost of Capital submissions are available at role of National Transmission Planner. role in initiatives to define the future of involvement with Grid Australia, the in a number of processes that will guide (WACC) Review, which defines the www.gridaustralia.com.au. Powerlink will contribute to the planning energy supply in Australia and to meet organisation representing the owners the future development of the NEM. parameters for the rate of return used

activities carried out by the National the National Electricity Objective – to of Australia’s electricity transmission These included the: to calculate transmission network networks in the NEM, plus Western providers’ regulated income Transmission Planner, including the promote an efficient, reliable, and safe Australian Energy Market Commission Australia. Grid Australia identifies issues publication of the National Transmission electricity supply for the long-term (AEMC) Review of Energy Market AEMC interim report on transmission of interest to transmission network Network Development Plan (NTNDP), interests of consumers. Frameworks in the Light of Climate reliability standards, Towards a owners and advocates for practical which will focus on the strategic and Change Policies, which explores the Nationally Consistent Framework for solutions that are in their common long-term development of the implications of emerging policies that Transmission Reliability Standards interest and in the best interests of national grid. will affect the mix and location of electricity consumers. Powerlink’s Chief AEMC Review into the Use of Total electricity generators and how these Executive Gordon Jardine is Chairman Factor Productivity (TFP). will be connected into the grid of Grid Australia.

16 powerlink annual report 2008/09 powerlink annual report 2008/09 17 Powerlink and the National Electricity Market

Powerlink’s role in The Commonwealth Government’s Increasing awareness of climate change Regulated revenue New connections in 2008/09 climate change initiatives CPRS aims to reduce greenhouse and emerging carbon reduction policies and transmission pricing Powerlink provides access to the foreseeable 2008/09 In 2008/09, Powerlink contributed to gases at the lowest overall cost using are already changing the mix of The AER determines Powerlink’s transmission network under a industry discussion on the implications market mechanisms. Specialist economic generation in Queensland. The new allowable revenue for regulated services non-discriminatory regime. of climate change and carbon reduction modelling of the NEM under the CPRS, generation presently being connected so that the electricity transmission In the past year, Powerlink commenced In 2009/10 and beyond Powerlink will: policies. This participation will underpin commissioned by the Commonwealth to the grid is lower emissions gas-fired network can be developed, operated work to connect three power stations, our vital role in planning and providing Government, indicates that emissions generation, and there is a significant and maintained efficiently, while meeting Adapt to the changes to the national which are expected to be completed infrastructure which will facilitate the trading will result in a gradual transition number of enquiries for grid connection Queensland’s electricity demand growth. regulatory framework and planning by December 2009. They are: expected transition to a lower emissions to a lower emissions generation mix. from low emissions and renewables arrangements. Powerlink’s allowable regulated revenue generation mix arising from the In Queensland, it is expected that generation proponents. ERM Power’s and Arrow Energy’s was specified in the AER’s Final Decision Continue to work with the Commonwealth Government’s Carbon gas-fired generation will play a key role 450 megawatt Braemar 2 Power Powerlink has also worked with of June 2007 and applies to each financial Queensland Government to Pollution Reduction Scheme (CPRS) and in that transition. Similarly, the MRET Station (coal seam methane gas-fired) the Queensland Government’s year from 1 July 2007 to 30 June 2012. its 20 per cent Mandatory Renewable is designed to source 20 per cent of identify locations for economic Office of Clean Energy to advise on From these annual revenues, we Origin Energy’s 630 megawatt Darling Energy Target (MRET) by 2020. electricity supply from renewables by grid connection of potential locations which could provide economic determine the transmission prices for 2020 at least cost. The modelling shows Downs Power Station (coal seam renewable generators. A strong transmission grid is a central grid connection for large-scale our network customers in accordance that the least cost renewables in the methane gas-fired) plank in supporting Australia’s and renewables generation. with the methodology prescribed in the Begin preparations for Powerlink’s 2020 timeframe are likely to be wind Origin Energy’s 150 megawatt Queensland’s move to a lower emissions Rules. While electricity transmission is regulated revenue reset submission to and biomass. In Queensland, the quality Furthermore, we anticipate there will be Mount Stuart Power Station generation mix. As Queensland trends the backbone of the electricity supply the AER for the five-year period renewable energy resources are located a continued increase in energy efficiency Number 3 (jet fuel-fired). toward this lower emissions generation chain, Powerlink’s charges for electricity commencing 1 July 2012. away from the major population centres, initiatives. Energy efficiency aims to mix, ongoing development of the represent only about 10 per cent of the Powerlink is also carrying out works requiring the transmission grid to reduce overall daily energy consumption. transmission grid will be pivotal to average household electricity bill. associated with the connection of Rio transport that power to consumers. However, this will have little impact on transporting the power generated from Tinto’s Yarwun Alumina Refinery. the main driver for development of the In 2008/09, Powerlink’s allowable the new renewable and gas-fired sources grid, which is peak electricity demand. regulated revenue was $595.9 million. to the State’s major population centres. The changes to the Queensland This revenue supported Powerlink’s transmission grid that will be driven essential network augmentation by climate change initiatives are program which ensures development expected to be gradual and therefore of the grid to meet increasing electricity can be managed effectively within demand and the ongoing reliability of Powerlink’s existing planning processes the network. and timeframes. Solid network performance in 2008 The AER sets network reliability targets for Transmission Network Service Providers, and these apply on a calendar-year basis. In 2008, Powerlink met or exceeded these performance targets. Powerlink continues to adopt strategies to maintain its world-leading performance for reliability and cost effectiveness (as measured in the A strong transmission grid is a central plank in supporting Queensland’s biennial International Transmission move to a lower emissions generation mix Operations and Maintenance Study).

18 powerlink annual report 2008/09 powerlink annual report 2008/09 19 network strategy and operations adaptable

Powerlink is dedicated to meeting the transmission needs of Queensland reliably and cost effectively.

Powerlink plays a crucial role in The 2009 APR showed that statewide deliverable 2008/09 supporting Queensland’s growth. peak electricity demand is expected to Our work includes planning and building grow at 3.8 per cent per year on average A new record peak demand of new high voltage transmission lines for the next 10 years. While electricity 8,677 megawatts was reached and substations to provide continued demand is expected to be lower than on 9 February 2009. security and reliability of the the historical trend in the next two years We released our 2009 Annual Queensland electricity grid. due to the economic slowdown, it is forecast to return to long-term trend Planning Report. Our activities and operations are growth thereafter. We introduced new live line undertaken in compliance with work techniques to allow the Electricity Act 1994, the Queensland’s electricity demand growth transmission lines to be strung National Electricity Rules (the Rules), will continue to be the highest in the above distribution lines without and other relevant legislation. NEM, driven by population growth and the continued installation and use of air disruption to service. Transmission network planning conditioning. The summer maximum A new agreement was and development are integral to electricity demand (weather corrected) established to guide the Powerlink meeting its obligations. has grown significantly over the past five procurement of substation Powerlink’s 2009 Annual Planning Report years with a statewide growth of 23 per design and construction services. (APR) was issued on 30 June 2009 to cent (about 4.3 per cent per year), and a National Electricity Market (NEM) Our emergency response growth of 32 per cent (or 5.7 per cent participants and other interested parties. systems proved highly effective per year) in South East Queensland. The APR presented historical and when an extreme weather event Looking forward, summer maximum forecast electricity demand, and our damaged transmission towers native demand is forecast to continue plans to develop the transmission near Dysart in December 2008. to grow strongly with an average annual network in response to forecast statewide increase of 4.4 per cent per demand growth. year over the next five years. Electricity demand forecasts A new statewide summer peak demand In line with its obligations under (as generated) of 8,677 megawatts was the Rules, Powerlink publishes its APR recorded on 9 February 2009. in June each year. The APR identifies Annual energy to be supplied from where, and when, development of the Powerlink’s transmission network and network needs to happen just ahead of significant embedded generators is increasing demand in order to ensure forecast to increase at an average rate the continued reliability of the high of 3.1 per cent per year. voltage network. (continues overleaf) Powerlink plays a crucial role in Linton Hart, Field Test Engineering Officer, and Michael Rowlands, Engineering Officer, in the new Woolooga Substation Control Room supporting Queensland’s growth.

20 powerlink annual report 2008/09 powerlink annual report 2008/09 21 network strategy and operations

(continued from page 20) Continuous improvements Portable under-crossing protective barrier Temporary relocatable The long-term forecast growth in peak to transmission services Powerlink’s engineering team developed Static VAr Compensator electricity demand is the key driver for Powerlink is implementing a range of a new technique involving the use of a Static VAr Compensators (SVCs) are a Powerlink’s investment in the strategies to continue to improve purpose-built, portable structure that crucial component for regulating voltage transmission network. Powerlink’s network service delivery, ensure that creates a ‘bridge’ to reduce the need for in the high voltage transmission system planning process takes into account we are equipped with the resources and localised outages on the distribution (see case study page 34). long-term trends in electricity usage, capabilities to deliver our significant network when Powerlink is stringing Over the past few years, Powerlink has current economic influences, and capital works program, and continue to conductors. Previously, it was necessary been working with a major equipment underlying factors that drive future provide a cost-efficient and reliable to schedule an outage in the relevant supplier to replace control systems on demand including weather, population transmission service to our customers section of the distribution network to nine SVCs that are part of the electricity growth, economic growth and industrial throughout Queensland. ensure that the distributor’s powerlines supply points to QR Network’s rail development, as well as the expected and supply were protected in the event We continue to target opportunities network. While such major activities effects of energy efficiency and that the conductors made contact during which enable us to deliver our capital usually require outages of the SVC of conservation initiatives. the stringing process. program on time, safely and to a high up to eight weeks, the need to minimise The 2009 Annual Planning Report is quality, and operate and maintain The new approach was successfully used disruption to the coal transport system available at www.powerlink.com.au our network to meet the reliability during the connection works associated meant that outages needed to be under the Documents section. targets set by the Australian Energy with the establishment of Powerlink’s scheduled to coincide with rail Jodie McMillan, Science Technician, in Powerlink’s Oil Testing Services lab Regulator (AER). new Abermain Substation in the vicinity maintenance days at each site. Building for the future of ENERGEX powerlines. The project team and the supplier Powerlink is undertaking the Managing network access and developed a unique solution – a largest capital works program in System security As a participating member of the works to meet customer needs Live line insulator washing procedure temporary relocatable SVC, small the electricity transmission sector in Powerlink’s Network Operations Centre International Electricity Infrastructure There are times when outages must From time to time insulators require enough to be towed by a standard truck. Australia, supporting regional growth oversees the real-time management of Assurance Forum, we have access be scheduled in order to undertake the cleaning to prevent the build-up of The relocatable SVC was used to and the export infrastructure chain the transmission system 24 hours a day, to important security information, construction and maintenance of the contaminants which have the potential provide the necessary support to each through the timely augmentation of the 365 days a year. In conjunction with the training and workshops that ensure network. We schedule these outages to impact the effectiveness of the substation while the permanent SVC network to meet the forecast electricity Australian Energy Market Operator we remain abreast of developments to minimise any associated impacts on insulation. Powerlink has developed a was refurbished and re-commissioned. demand growth. (AEMO), our operations team ensures in infrastructure security, and that our customer supply and the operations new washing technique that avoids the that the system is continually operated in security strategies reflect worldwide of the NEM. In line with the Rules, need to de-energise the feeder. Since 2004/05, Powerlink has invested a secure, reliable and efficient manner, best practice. we provide advanced notification of around $2.5 billion in augmenting the This innovation uses a pulsating jet of relying on modern computer-controlled these planned outages by publishing network, replacing aged assets, and We once again met our obligation to high-pressure aerated water, which is systems for real-time monitoring and a 13-month outage plan, updated maintaining the network. We currently provide the Queensland Government constantly monitored for conductivity. control of the network. on a monthly basis, to inform have $1.6 billion in capital projects with an annual Assurance Statement If the conductivity rises for any reason, NEM participants. approved and under way, and our total The Network Operations Centre uses which is required of all critical the pump automatically cuts off. capital program is expected to be in the state-of-the-art diagnostic tools and infrastructure providers in Queensland. An important part of maintaining The new system was trialled successfully range of $500 million to $600 million video systems to assess remote network We also retained our involvement with electricity supply and minimising in 2008/09 on the 110 kilovolt line each year for the foreseeable future. components, including the world-leading Commonwealth and State Government inconvenience to distribution networks between Rocklea and Sumner The replacement of assets which are OpsWAN system, which is featured in agencies in accordance with the during essential construction and substation, which is near a number reaching the end of their service life will the case study on page 24. National Guidelines for Protecting maintenance works is our ability to of construction sites that produce represent an increasing proportion of Critical Infrastructure from Terrorism undertake live line and substation work, contaminants such as dust. this program. Infrastructure security and the Queensland Government Plan which along with the following three Powerlink’s security policy acknowledges for the Protection of Critical Infrastructure new techniques utilised in 2008/09, plays the status of our network as critical from Terrorism. an important role in minimising impacts national infrastructure. It underpins our on consumers and the electricity market. commitment to the safety of our people and the public, and the management of the protection of our network, and the need to ensure business continuity.

22 powerlink annual report 2008/09 powerlink annual report 2008/09 23 network strategy and operations

assessable: A world’s best-practice solution to integrated performance diagnostics

Powerlink’s leading OpsWAN technology “This means we can respond quickly to “The ongoing performance data from was upgraded in 2008/09, reinforcing ensure the security of supply, safety of the OpsWAN also feeds into maintenance Powerlink’s drive to maintain world-class public and safety of our staff and network planning and decisions about replacement levels of system security and reliability. assets. This rapid appraisal and diagnosis of network components.” OpsWAN (which stands for Operations avoids or defers the need for an Wide Area Network) is a high-speed immediate call-out to site in the As part of a two-year program of works, communication and computer system majority of cases. Powerlink began the roll-out of several that allows Powerlink’s Operations team upgrades and system enhancements rapid, remote access to our substation “Powerlink is a leader during 2008. These included the plant and equipment. introduction of equipment for high-speed in the implementation of monitoring of power system events The OpsWAN infrastructure is OpsWAN-based transmission (which is now an AEMO requirement fundamental in enabling remote plant and equipment for all Transmission Network Service investigation of network faults Providers), and a program of power and on line condition monitoring monitoring in Australia.” quality monitoring which requires the of transmission assets, and is made Jamie Gabb, Manager Asset Monitoring. installation of equipment to monitor high possible by high-speed optical fibres voltage power quality across the network. fitted inside the core of overhead “Avoiding unplanned, long distance Progressive replacement of earth wires installed through key parts call-outs removes the traditional delays OpsWAN equipment to ensure our of our transmission network. to restoring plant to service, and in cases computer and network hardware is where we do deploy staff to site, the Manager Asset Monitoring, Jamie Gabb, kept up-to-date and supportable also OpsWAN network allows us to gather said OpsWAN provides Powerlink’s commenced in 2008/09. the relevant engineering data and fully Asset Monitoring group with rapid access inform field technicians of the situation to information, facilitating an immediate before they arrive on site,” Jamie said. and accurate assessment of the problem so that informed decisions can be made about the significance of an event on the network. Jamie Gabb, Manager Asset Monitoring, and Paul Wilson, Fault Management Analyst

Maintaining the network When new equipment is introduced, The workshops and resulting In 2008/09, the new system proved Over the past decade, Powerlink has New Substation Agreement Powerlink is responsible for maintaining reliability-centred maintenance maintenance regimes are an highly effective in factory and site integrated Optical Fibre Ground Wire improves flexibility and competition and updating its network to ensure workshops are the first step in defining important part of Powerlink’s acceptance testing at locations where (OPGW) into the construction of new The implementation of a new agreement continuing efficiency and reliability. the maintenance requirements. risk management approach. conventional substation communications transmission lines and has retrofitted it in early 2009 will shape the procurement were not yet in place. It also has to selected existing lines. Network maintenance is planned, taking In 2008/09, one example of a reliability- and management of substation design, More efficient commissioning potential for reinstating supply and construction, and testing. The agreement into account the lifecycle of different centred maintenance workshop program using mobile telecommunications A high capacity optical fibre components of the system and their testing during emergency situations, such is a competitive arrangement that was the roll-out of new SVCs across the The commissioning of new telecommunications solution is now servicing needs. In the financial period, as cyclones, in which telecommunications facilitates the tendering process for network. These workshops brought substations on greenfield sites requires being progressively installed between $73.3 million was invested in the equipment may be out of service. the major components of a substation together Powerlink personnel, extensive computerisation and testing. Brisbane and Cairns. The new network maintenance of the network. manufacturers’ representatives and utilises Dense Wave Distributed project, according to the specific needs Powerlink has developed a new Developing of the project. As with all of Powerlink’s The development of ongoing design and maintenance experts to telecommunications capacity Multiplexing (DWDM) technology, mobile telecommunications solution procurement of goods and services, maintenance programs for major new scope the new SVCs’ maintenance which allows transfer of 400 Gigabits to facilitate this process, using the The real-time testing, monitoring and the establishment of the new agreement equipment is critical to achieving needs. The workshops for this complex per second. mobile telecommunications network, control of Powerlink’s transmission was undertaken in accordance with maximum reliability once the equipment equipment took place over two weeks, to optimise testing and commissioning network are facilitated by a the objectives of the State Procurement is in operation in the network. dealing with both primary plant and timeframes. sophisticated, high capacity Policy and policy on contracting. secondary systems maintenance. telecommunications network.

24 powerlink annual report 2008/09 powerlink annual report 2008/09 25 network strategy and operations

Corporate emergency response Dysart storm Securing easements for future needs In 2008/09, easements and substation Powerlink’s suite of well-developed, In December 2008, a severe storm A vital part of Powerlink’s long-term sites gazetted included: foreseeable 2008/09 understood, and rehearsed corporate caused permanent damage to seven high planning is the securing of strategic Bouldercombe to Pandoin emergency response plans ensure voltage transmission towers near Dysart. easements for future transmission lines. 132 kilovolt transmission line we have the capability to quickly While the event was managed with no Wherever possible, we do this many In 2009/10 and beyond Powerlink plans to: respond to any network or corporate interruption to electricity supplies, the years in advance of line construction Strathmore to Bowen 132 kilovolt emergency. Our corporate emergency prompt restoration of the network in so that we can provide certainty to transmission line (Stage One) Continue to integrate the impacts of response plan is reviewed regularly the area, along with comprehensive local government, landowners and Strathmore to Ross 275 kilovolt climate change and carbon policies and forms an integral part of our contingency plans, ensured the the community about the location of transmission line into its annual planning processes. strategy to deliver a secure and continued security and reliability of future powerlines. This approach allows Invest about $600 million annually in reliable transmission network. the network supplying Ergon Energy, better land use planning by councils, Blackstone 275 kilovolt Substation capital works to upgrade the network large coal mines and the QR Network. developers and Government agencies The Pandemic Emergency Management Mount Stuart GT Power Station and replace aged assets. and preserves our ability to construct Plan was activated in response to the The replacement of the damaged towers 132 kilovolt transmission line. new infrastructure in increasingly Continue to research and develop Pandemic (H1N1) 2009 outbreak. took place over just three weeks despite urbanised areas. ways to enhance the operation the remote location. Several desktop and ‘live’ exercises of the Powerlink network using were also conducted as part of an North Queensland outage world-leading technology. annual program to test and improve We demonstrated our emergency procedures. In October 2008, a Continue to strengthen our response capability in January 2009 simulated emergency exercise was telecommunications network and Refurbishing transmission towers in when an electrical fault affected the Far North Queensland conducted with Ergon Energy in duplicate data pathways to further main power supply to North and Far Townsville, based on the scenario of reinforce the protection and North Queensland, resulting in rare and a major cyclone with co-location of monitoring of the network. unexpected simultaneous outages on Powerlink and Ergon Energy emergency both of the 275 kilovolt transmission response and corporate communication lines that supply Townsville and the teams co-located to deal with Cairns regions from the south. The its aftermath. outage resulted in the loss of supply to approximately 200,000 customers in the Townsville and Cairns regions however Powerlink, working with Ergon Energy, responded quickly and safely to progressively restore power to all customers within two hours.

Powerlink worked quickly to replace a section of line near Dysart which was damaged in a severe storm

26 powerlink annual report 2008/09 powerlink annual report 2008/09 27 network development Powerlink is undertaking the largest capital works program in the electricity transmission extendable sector in Australia.

Over recent years, Queensland’s electricity demands have been growing faster than any other State in Australia. Powerlink continues to extend the network to cater for the growing population and long-term electricity growth forecasts.

Powerlink is undertaking the largest the anticipated limitation and seeks deliverable 2008/09 capital works program in the electricity information from those parties on transmission sector in Australia. In feasible non-network solutions to Powerlink completed 2008/09, we undertook $675 million in address the anticipated constraint. construction of 504 kilometres construction works across Queensland. We then carry out detailed technical of new transmission lines, Powerlink is required to undertake the and economic analysis to determine the 707 towers and four major assessment process set out in the feasible network solutions that address new substations. National Electricity Rules (the Rules), the identified network limitation. Having We delivered our $675 million including applying the Australian Energy undertaken this rigorous investigation, capital works program on Regulator (AER) Regulatory Test prior to Powerlink applies the AER Regulatory schedule despite extensive constructing new transmission lines and Test and consults with NEM participants flooding and adverse weather substation developments to increase the and interested parties on feasible conditions in North Queensland. capacity of the transmission network. alternatives to identify the most economic solution. We completed Stage One and Where our planning process identifies Stage Two of the $500 million- that the transmission network supplying plus Central Queensland to Regulatory Test processes a region is approaching its limits in the North Queensland transmission undertaken in 2008/09 next few years because of growing reinforcement project and In 2008/09, we completed consultation electricity demand, Powerlink notifies began work on Stage Three and Regulatory Test assessment for the (the final stage). National Electricity Market (NEM) following identified needs. participants and interested parties of We installed three Static VAr Compensators (a specialised and sophisticated part of substation technology that Identified need Solution identified in the provides fast-acting power Regulatory Test compensation to control load Supply to Bowen Staged construction of a new and voltages). 132/66 kilovolt substation at Bowen North and a Strathmore to Bowen Planning for the 500 kilovolt North 132 kilovolt transmission line. network continued, with the Supply to North and Construction of the Strathmore to publication of the Final Report Far North Queensland Ross 275 kilovolt transmission line and on the South West to South East provision of network support services from Queensland augmentation. Origin Energy, CS Energy, and CSR Sugar. We completed the Nebo to Supply to South East Queensland Construction of 275 kilovolt Static Bolingbroke transmission line VAr Compensator (SVC) at South Pine Substation and installation of shunt for QR Network. capacitor banks at Ashgrove West, Loganlea, and Belmont substations.

Belmont Substation upgrade in Brisbane

28 powerlink annual report 2008/09 powerlink annual report 2008/09 29 network development

Planning for the 500 kilovolt network The precise timing of the construction The QNI upgrade study, which was Major projects completed since June 2008 As part of our commitment to long-term of the line sections depends on future published in a Final Report in October planning, Powerlink has been preparing electricity demand growth in South East 2008, identified that the most economic Region Project Brief description Project purpose Milestones achieved for the future construction of a new Queensland, and on the location and capacity upgrade would be the North Townsville South to Construction of a To ensure continued Commissioned in higher-capacity 500 kilovolt transmission timing of new generation developments installation of series compensation Queensland Townsville East 132 kilovolt transmission reliability of electricity July 2008. transmission line and line between Townsville supply and increase network to accommodate the growing in South Queensland. However based equipment on the existing on current forecasts, the first stage of interconnector lines at an estimated Townsville East Substation South and Townsville capacity to meet growing electricity needs in South East East Substations, and electricity demand in Queensland, which represents about the 500 kilovolt network development cost of $120 million. The Final Report construction of a new the Townsville CBD 60 per cent of the State’s electricity load. between Halys and Blackwall, which will concluded that the optimal timing under 132/66 kilovolt substation and Port areas. initially be operated at 275 kilovolts, will the most plausible scenario is 2015/16. at Townsville East. Based on forecasts of electricity be required in 2013/14. This date will be Based on that timing, Powerlink and Nebo to Bolingbroke Construction of a To ensure continued Construction demand, the 275 kilovolt transmission reviewed based on the latest demand TransGrid consider it premature to transmission line 132 kilovolt transmission reliability of electricity completed serving South East Queensland is outlook at the time of project approval. recommend an upgrade at this time. line between QR supply and increase in May 2009. expected to approach its capacity limits Network’s proposed capacity to meet the within the next five years. At the same We are committed to working closely Both organisations will continue to substation at Bolingbroke growing electricity time, South East Queensland is rapidly with local stakeholders, landowners and monitor developments which could and Powerlink’s Nebo demand from coal communities as we progressively impact on the scope and timing of a Substation. transport activities in the becoming more urbanised, placing Bowen Basin. significant land use planning constraints develop the 500 kilovolt network. potential upgrade of the QNI, and will El Arish Substation Construction of a To help maintain a reliable Commissioned on the ‘footprint’ of the future proceed with further work where Queensland/New South Wales material changes to market 132/22 kilovolt substation supply of high voltage February 2009. transmission network. Interconnector at El Arish. electricity to the Mission developments occur. Beach area. Building a higher-capacity The Queensland/New South Wales 500 kilovolt transmission network Interconnector (QNI) connects Tully to Innisfail Construction of a To ensure continued Commissioned in will help meet the growing demand for transmission line 132 kilovolt transmission reliability of electricity August 2008. Queensland to the NEM, enabling line between Tully and supply to Far North electricity while reducing the overall interstate trade in electricity and Innisfail Substations as Queensland. number of new high voltage powerlines generation reserves to be shared a replacement for the that will need to be built in the future. between Queensland and the other ageing Kareeya to One 500 kilovolt transmission line is states in the NEM. Innisfail 132 kilovolt capable of carrying the same amount transmission line. Powerlink, and its New South Wales of electricity as about three 275 kilovolt Central Broadsound to Nebo Construction of a The first stage of a major Commissioned in counterpart, TransGrid, are committed lines, with a much smaller land Queensland transmission line 275 kilovolt transmission three-stage upgrade to October 2008. to investing in any upgrades to the QNI line between Broadsound ensure continued use requirement. which would deliver enough net market and Nebo. reliability of electricity The plan for the 500 kilovolt network benefits to pass the AER’s Regulatory supply and increase involves the progressive development capacity to meet growing Test. To this end, Powerlink and electricity demand in of the following sections of transmission TransGrid conducted a comprehensive North Queensland. line between: joint assessment of the optimal timing South Abermain Substation Construction of a To ensure continued Commissioned in the Surat Basin (from a new and size of an upgrade of the QNI. Queensland 275/110 kilovolt substation reliability of electricity March 2009. substation to be known as Western at Abermain. supply and increase capacity to meet growing Downs) and Halys (near Tarong) electricity needs in the Halys and Blackwall (near Ipswich) Ipswich area. Greenbank Substation – Installation of a Static Capacitive compensation Commissioned in Halys and Greenbank (in Logan). Static VAr Compensator VAr Compensator at to meet increasing December 2008. Greenbank Substation. reactive demand. West Darra Substation Replacement of aged To ensure continued Commissioned in equipment at the reliability of electricity April 2009. 110 kilovolt West Darra supply in the south west Substation. Brisbane area.

30 powerlink annual report 2008/09 powerlink annual report 2008/09 31 network development

Major projects under construction in 2008/09

Region Project Brief description Project purpose Milestones achieved Region Project Brief description Project purpose Milestones achieved North Innisfail to Construction of a 132 kilovolt To ensure continued Construction was completed SoutH South Pine Rebuilding and replacement To ensure continued Static VAr Compensator Queensland Edmonton transmission line to replace an reliability of supply to Far in June 2009. Commissioning Queensland Substation of aged equipment at the reliability of electricity commissioned in December replacement ageing line between Innisfail North Queensland. is to be completed in 110 kilovolt South Pine supply and meet growing 2008 and transformer transmission line and Edmonton. August 2009. Substation, including installation electricity demand in north commissioned in April 2009. of a Static VAr Compensator. eastern Brisbane. Strathmore Construction of a 275 kilovolt To ensure continued Construction Works to be completed to Ross transmission line between reliability of electricity supply began in May 2009. in 2010/11. transmission Strathmore and Ross and increase capacity to meet South Pine Construction of a 275 kilovolt To ensure continued Commissioning to be completed line Substations. growing electricity demand to Sandgate transmission line between South reliability of electricity in summer 2009/10. in North and Far North transmission line Pine Substation and ENERGEX’s supply to the north eastern Queensland. Sandgate Substation. Brisbane area. Strathmore to Construction of the new To ensure continued Preliminary works Woolooga Upgrade of the existing To ensure continued Construction began in Bowen 132/66 kilovolt Bowen North reliability of electricity supply began in May 2009. Substation 275/132 kilovolt Woolooga reliability of electricity supply November 2007. transmission line Substation and a 132 kilovolt to the growing Bowen region. Substation, including installation in South East Queensland. Static VAr Compensator and Bowen transmission line between Construction to be of a Static VAr Compensator. commissioned in November 2008. North Strathmore Substation and completed in 2010/11. Substation Bowen North Substation. Belmont Upgrade of the existing To maintain a reliable supply Works began in August 2008. Substation 275/110 kilovolt of high voltage electricity Clare Substation Replacement of the aged To ensure continued Construction to be Construction to be completed Belmont Substation. supply to South East 132 kilovolt substation at Clare. reliability of high voltage completed in late 2009. in 2010/11. Queensland. electricity supply to the Burdekin region. Braemar Works to connect Origin To provide a high voltage Darling Downs Power Station Substation – Energy’s new Darling Downs connection point for Darling connection to be completed in Cairns Replacement of aged equipment To ensure continued Construction to be completed power station Power Station, and ERM Power Downs Power Station and summer 2009/10. Substation at the Cairns Substation. reliability of transmission by summer 2010/11. connections and Arrow Energy’s Braemar Braemar 2 Power Station. services. Stage One connection for 2 Power Station to Braemar Braemar 2 Power Station was Ross to Yabulu Construction of a 275 kilovolt To ensure continued Construction of the Substation. commissioned in April 2009. South transmission line between Ross reliability of electricity supply transmission line was Additional works to be completed transmission line Substation and Yabulu South and increase capacity to meet completed in October 2008. by winter 2010. and Yabulu Substation and construction of a growing electricity demand South new 132 kilovolt substation at in the Townsville area. Construction of the Yabulu South Substation Yabulu South. Substation began in May 2008. Alligator Creek Upgrade of the existing To ensure continued Transformer commissioned Substation 132/33 kilovolt Alligator Creek reliability of supply to the coal in February 2009. Substation including installation loading terminals of Hay Point of two new transformers and and Dalrymple Bay, and Construction to be associated equipment. surrounding areas. completed in 2009/10. Central Nebo to Construction of a 275 kilovolt To ensure continued Commissioning to be completed Queensland Strathmore transmission line between Nebo reliability of electricity in the second half of 2009. transmission line and Strathmore Substations. supply and increase capacity to meet growing electricity demand in North and Far North Queensland. Bouldercombe Construction of a new To ensure continued Construction began to Pandoin 132/66 kilovolt substation reliability of supply to the in September 2008. transmission line at Pandoin and a 132 kilovolt Rockhampton area. and Pandoin transmission between Substation Bouldercombe and Pandoin Substations. Larcom Creek Construction of a 275 kilovolt To provide additional Construction to be Substation substation at Larcom Creek and transmission capacity to completed in 2009/10. a new 275 kilovolt transmission the Gladstone area, including line from Larcom Creek the Gladstone State Substation to Yarwun Development Area. Substation. Yarwun Construction of a new To ensure continued Construction to be Substation 132/33 kilovolt substation reliability of electricity supply completed in 2009/10. at Yarwun. and increase capacity to meet growing electricity demand Cameron Meekin, Program Manager, pictured during helicopter stringing of the South Pine to Sandgate transmission line in Brisbane in the Yarwun area.

32 powerlink annual report 2008/09 powerlink annual report 2008/09 33 network development

manageable: Maximising system efficiency and managing load with new SVCs

In 2008/09 Powerlink installed three Powerlink’s Manager Engineering, “In the meantime, our substation design new Static VAr Compensators (SVCs) Brian Pokarier, said the delivery and teams and project managers prepared at our Woolooga, South Pine and commissioning of the three new SVCs to locate the SVCs within our substation Greenbank substations, increasing the in 2008/09 was the culmination of sites. Once the equipment arrived, each capacity of the transmission network comprehensive planning, design and SVC project demanded significant ongoing in South East Queensland. construction management carried collaboration between our construction out by a multi-disciplinary team. managers, commissioning engineers, SVCs are highly complex pieces of substation teams and the manufacturers.” equipment that facilitate fast-acting “The new SVCs give reactive power compensation on the network. additional flexibility of control and support the A key feature of this type of plant is that the power electronics allow substations’ vital role in the device to continuously support transforming, switching, the capacitive and inductive needs measuring and controlling of the network. Through stabilising and controlling the voltage, they supply across the network.” allow existing lines to operate more Manager Engineering, Brian Pokarier efficiently, thus giving increased capacity to transmission lines. “Powerlink’s grid planners identified the need for the SVCs, while our SVC The SVCs in the Powerlink transmission specialist engineers and engineering network help stabilise power across project managers oversaw the design, Brian Pokarier, Manager Engineering, and Queensland and into New South Wales factory testing and construction of Tuan Vu, SVC Project Manager, at the via the Queensland/New South Wales Greenbank SVC the SVCs,” Brian said. Interconnector.

Brian Pokarier, Manager Engineering, at the Greenbank SVC

34 powerlink annual report 2008/09 powerlink annual report 2008/09 35 network development

constructable: foreseeable 2008/09 In 2009/10 and beyond Powerlink will: Meeting the challenges of terrain and weather in North and Far North Queensland Complete the Regulatory Test processes for the following In North and Far North Queensland, “They must be the best solution for “In North and Far North Queensland, network developments: Powerlink is working to ensure a safe and Queensland’s climate (particularly we must meet additional design reliable supply of high voltage electricity cyclone conditions in North and Far challenges such as safe height clearance - Supply to South West and continues to be maintained to the region North Queensland), for conductor weight of rainforest canopies, sandy silt soils, South East Queensland. and to underpin future economic and tension requirements, required safe steep and undulating topography, development. To deliver these ground clearances, and the topography sensitive environments and still meet Continue construction on augmentations to the grid in a timely of the terrain traversed. Similarly, the requirement of AS1170 Region C transmission line projects including: manner, our transmission line design and foundation designs must consider the cyclonic zone wind speeds,” Trevor said. construction teams are meeting the variability of soil type, terrain constraints, - Strathmore to Ross challenges posed by difficult terrain and wind and any permanent stresses induced Construction challenges 275 kilovolt transmission line tropical weather conditions. by the structures,” Trevor said. The Powerlink construction teams  - Strathmore to Bowen working in North Queensland in In 2008/09, Powerlink completed “The completion of these 132 kilovolt transmission line construction of the first and second 2008/09 surmounted a range of challenges, stages of the Central Queensland to projects to the highest including a demanding program of works, - South Pine to Sandgate North Queensland reinforcement standards, and in the case an extreme wet season (with five times 275 kilovolt transmission line the expected average rainfall in some project between Broadsound in Central of the Innisfail to Edmonton Queensland and Strathmore in North areas) and testing terrain. - Bouldercombe to Pandoin project ahead of schedule, 132 kilovolt transmission line. Queensland, the Tully to Innisfail and Lines Construction Management Team Innisfail to Edmonton transmission line was the result of Powerlink Leader, Col Langton, said meeting Continue construction on substation replacement projects in the Far North, people and our contractors construction timelines while allowing and the Ross to Townsville South to projects, including: working together with a for unpredictable extremes of weather Townsville East transmission line project. provided logistical and construction - Replacement of aged equipment Designing and constructing these lines in shared commitment challenges for Powerlink’s project at Cairns Substation extreme weather conditions and across to excellence.” managers and construction teams. diverse environments, including World - Establishment of the Bowen North “We have been continuing to evolve our Heritage rainforest and steep terrain, Col Langton, Lines Construction 132/66 kilovolt Substation demonstrates Powerlink’s thoroughness, Management Team Leader construction methods to reduce impacts adaptability and innovation, the strength on landowners, the community and the - Establishment of the Larcom Creek of our project management processes and “In addition, the location of each environment. But on many of these 275 kilovolt Substation the skills and the resilience of our tower must avoid the most vulnerable projects in 2008/09, we also had to construction teams. environmental areas and allow ongoing contend with extremely wet weather - Establishment of the Yabulu South low-impact access for construction and in some areas such as Mackay and 132 kilovolt Substation Optimum line design and maintenance. Safety considerations Townsville, flooding,” Col said. are paramount and are also built into - Rebuilding and replacement Powerlink’s line design experts undertake the designs. “We applied a range of construction of aged assets at the South Pine the design of suitable structures and solutions to address these issues while 110 kilovolt Substation arrange their manufacture, specify “The design process involves aerial laser also making sure we created the least appropriate foundations for the structures, surveys that enable us to create three- possible disturbance to the environment. - Upgrade of the existing and ensure that the configurations meet dimensional terrain and obstacle maps to These solutions included the use of smaller 275/110 kilovolt Belmont Substation. the technical power transfer requirements. within 50mm accuracy, and the adoption and more versatile plant, and screw of special three-dimensional computer Line Design Manager, Trevor Jacobs, anchor foundations. Helicopter stringing programs also enable us to model and explains that transmission structures of the conductor wires was also used to evaluate design alternatives. minimise the impact in environmentally- are designed specifically for the network Construction teams met the challenges sensitive areas and extend the range of needs and operating conditions unique of tropical weather conditions during to each transmission line. workable weather conditions.” construction of the Innisfail to Edmonton transmission line

36 powerlink annual report 2008/09 powerlink annual report 2008/09 37 environment

Powerlink’s environmental strategies take a sustainable lifecycle approach to sustainable operations.

Powerlink constructs, maintains, and operates its high voltage transmission lines in some of the world’s most extreme and sensitive environments. Our staff are challenged and empowered to protect, enhance and respect the environment, balancing business outcomes with environmental outcomes.

Powerlink’s substantial capital Our asset handover strategies deliverable 2008/09 works program is underpinned by a define clear responsibilities ensuring rigorous process to ensure that any effective transfer of environmental Powerlink registered with the new environmental impacts are identified and custodianship from those involved in the National Greenhouse Emission that management plans are put in place construction phase of projects to those Reporting scheme – a single to minimise these impacts. We closely involved in the ongoing maintenance. national reporting framework for monitor all construction activities to This underpins a total lifecycle approach the reporting and dissemination of ensure compliance with the relevant to sustainable operations. information about greenhouse gas environmental legislation such as the Only one minor environmental incident emissions, greenhouse gas projects, Environmental Protection Act 1994 occurred during the period. Powerlink energy use, and energy production. and the Integrated Planning Act 1997 worked closely with the Environmental (Queensland), and that they are aligned We took proactive steps to offset Protection Authority in managing the our in-house carbon production with Powerlink’s commitment to incident, and no fines were imposed. through a variety of initiatives environmentally responsible including more efficient fleet performance. Environmental training management, voluntary carbon and development Our rational approach to climate change offsets, and installation of energy Environmental awareness is an efficient lighting. means we are focusing our efforts on matters that are within our control. important facet of induction training We continued to monitor We have undertaken a number of for all Powerlink staff. Construction and manage SF emissions 6 initiatives to reduce Powerlink’s in-house managers undertake a special e-training (a greenhouse gas present in greenhouse emissions by actively module designed to increase awareness some transmission switchgear) targeting waste, energy, water, transport, of their responsibilities and of and continued to review and emissions inventories. environmental risks and benefits. switchgear design alternatives, In 2008/09 a new professional looking at whole-of-life impacts. Our management of environmental performance development program for environmental Together with other Queensland staff was introduced, which saw them Powerlink’s Environmental Steering energy companies, we worked embedded within other departments to Committee identifies the environmental to identify more sustainable help reinforce a whole-of-organisation procurement processes that requirements to be addressed by approach to environmental sustainability. take into account the the Environmental Strategy Plans (continues overleaf) environmental sustainability which guide our operations. of products and suppliers. These Environmental Strategy We worked to maintain and Plans set strategies for managing restore the historic coke oven both performance and risk. mounds in the vicinity of the Abermain Substation, near Ipswich. Powerlink works proactively to manage the impact of our operations on flora and fauna

38 powerlink annual report 2008/09 powerlink annual report 2008/09 39 environment

(continued from page 38) This cross-regional Traditional Owner As we realise cost efficiency gains Where operational requirements Managing water consumption 30,000 Protecting Cultural Heritage natural resource management initiative through the implementation of these dictate vehicles which can not By the end of the 2008/09 year, we Powerlink is proud of its proactive is aimed at building collaborative, holistic initiatives, we are reinvesting these gains meet these ratings, we offset had reduced our water consumption 25,000 31,000 kL approach to the management of cultural partnerships to integrate natural and into the purchase of green electricity carbon emissions through Ecofund, at our head office by 65 per cent on heritage on its easements and substation cultural resource management in the for our head office facilities in Brisbane, a Queensland Government initiative 2004/05 levels, notwithstanding a large 20,000 sites. Our compliance with our duty region. The Bunya Mountains area holds thereby delivering further emission that invests in environmental projects increase in workforce numbers (refer to of care is evidenced in the Cultural great cultural significance as a traditional reductions. Our activities to reduce such as energy efficiency, renewable graph). During the past year, we installed 15,000 Heritage Management Agreements festival gathering place for Aboriginal in-house greenhouse gas emissions energy and biodiverse forestry five rainwater tanks with a combined peoples from across southern include: projects across the State. We also (CHMA) that are developed as capacity of 89,500 litres. 10,000 Queensland and northern New South offset the emissions from our air

an integral part of any major new 14,700 kL Reducing energy use Sustainable procurement

Wales, many of whom are represented 12,732 kL transmission line or substation travel through Ecofund. 5,000

Powerlink has replaced office 10,965 kL construction project. in this project. In 2008/09, procurement managers lighting with low-energy equivalents Recycling and reusing Our Cultural Heritage team also and environmental representatives 0 We have continued to build long-term and in 2008/09 we undertook an We have implemented various FY04/05 FY05/06 FY06/07 FY07/08 worked in conjunction with North from Powerlink and Queensland relationships with relevant Traditional air conditioning audit. recycling initiatives to minimise Ipswich Rotary and the Willis Haenke energy companies formed a Sustainable Owners and other community and our resource usage and to reduce Protecting Queensland Foundation to fence, maintain and A ‘green computer’ power-down Procurement Energy Committee (SPEC) heritage groups to establish a foundation waste. We recycle a range of our with biosecurity measures restore the historic coke oven mounds project was trialled during the to consider the recently introduced State of understanding for resolving any business-related waste, including near the Abermain Substation. The coke year, cutting computing emissions Procurement Policy and to create a The potential negative impacts potential issues which may arise not only electronic equipment such as ovens are a relic from the time when an by 30 per cent. The success of the purchasing guide that takes into account of weeds, pathogens and animal pests during construction, but also during the telecommunications equipment, small historic coalfield and power station were trial will lead to an organisation-wide environmental sustainability of products on the environment are significant. subsequent operation and maintenance appliances, and rechargeable batteries. located at Tivoli near Ipswich. power-down project being rolled out. and suppliers. Under legislation, primarily the Land of our network. During 2008/09, we Other initiatives include reprocessing Protection (Pest and Stock Route The SPEC will develop mechanisms to developed and implemented CHMAs Managing and reducing Purchase of ‘green power’ transformer oil (vegetable-derived Management) Act 2002, Powerlink and agreements with 10 different help member organisations to achieve greenhouse gas In 2008/09, Powerlink purchased alternatives are also being researched has a duty to effectively manage Traditional Owner groups for new sustainable purchases. During the past The new National Greenhouse and Energy 5,103,999 kilowatt hours of green and tested), and using ground-down and prevent environmental impacts. assets in North, Central and South year, the group has developed consistent Reporting Act 2007 (the NGER Act) was power. This equated to 50 per cent ceramic as a road-surfacing material. The Land Protection (Pest and Stock Route Queensland. We also provided input to questions for tender documentation to passed in September 2007 and further of our estimated energy usage for In 2008/09, we also implemented the Management) Regulation 2003 defines the State Government’s review of the assist suppliers to address sustainability amended in March 2009. It provides a our Virginia office for the year, which use of recycled metal for transmission a range of plants and animals (‘declared Aboriginal Cultural Heritage Act 2003. criteria in energy sector tenders. single national reporting framework on in turn equated to 4,656 tonnes of tower signage. pests’) that warrant particular attention Powerlink is represented on the greenhouse gas emissions and energy carbon dioxide reduction. We routinely audit our waste and and have specific requirements for Bunya Mountains Heritage Steering use. The first annual reporting period recycling activities to ensure we control and management. Committee which worked during the began on 1 July 2008 and Powerlink has Reducing travel emissions continue to improve. year with a newly-formed Traditional registered to comply. Powerlink’s establishment of Owner body to establish the Bunya a Motor Vehicle Environmental Minimising SF emissions As a signatory to the Commonwealth 6 Mountains Traditional Owner Policy ensures that, where possible, Sulphur Hexafluoride (SF ) is a Government’s Greenhouse Challenge 6 Consultative Group, which includes we select vehicles that meet the greenhouse gas used in some high and Greenhouse Challenge Plus key Powerlink stakeholders including following minimum Green Vehicle voltage switchgear. Powerlink has a programs, Powerlink has been representatives from regional councils, Guide Greenhouse Ratings, in line continuing focus on capturing high voluntarily reporting on greenhouse gas and from the Commonwealth and State with the Queensland Government’s quality data on SF emissions to emissions since 1999. We are working 6 Governments. The Bunya Mountains QFleet Climate Smart Policy: allow ongoing improvements in loss cooperatively with other Transmission region is traversed by existing Powerlink prevention. Powerlink’s monitoring Network Service Providers in the - Passenger vehicles – at least transmission lines and easements, of this gas is world’s best practice, development of a robust reporting 5.5 (CO emissions 221–240 including the easement for the proposed 2 which applies state-of-the-art system to meet the requirements combined grams per kilometre) Halys to Springdale to Blackwall technology including cameras of the NGER framework. 500 kilovolt transmission line. - Light commercial vehicles – and mechanical sniffers. In our everyday business activities, at least 3.5 (CO emissions 2 In 2008/09, we reviewed switchgear we have also implemented a number 301–320 combined grams design standards and the effect of of initiatives to reduce our in-house per kilometre). lightning strikes on SF emissions. greenhouse emissions by actively 6 Alana Lorimer, Environmental Officer. Delicate mangrove habitat along the Ross River targeting waste, energy, water, in Townsville was protected during construction of the Townsville South to Townsville SF6 emissions are reportable under transmission, and emissions inventories. the NGER requirements. East transmission line

40 powerlink annual report 2008/09 powerlink annual report 2008/09 41 environment

preserveable: Protecting flora, fauna and visual amenity in the South Pine to Sandgate corridor

Planning, innovation and close consultation “During the planning stage, Powerlink In another move designed to minimise with the local community were critical identified the need to underground the visual impact for residents and to Powerlink’s ability to construct a new a two kilometre section of the line in a businesses in the vicinity of the line, 275 kilovolt transmission line between particularly built-up commercial area Powerlink’s line design team opted for a South Pine and Sandgate substations where there was insufficient space for lower-profile line featuring steel towers through sensitive, natural environments another overhead line,” Cameron said. treated with an anti-reflective coating to and built-up areas in northern Brisbane. better align with the look and feel of the “By working closely with existing ENERGEX sub-transmission line In 2008/09, Powerlink commenced the local community, on the same easement, and to minimise construction of the South Pine to the overall visual impact. Sandgate transmission line to reinforce Powerlink was able to electricity supply in and around the city’s achieve outstanding In addition, Cameron said Powerlink’s north-eastern suburbs. environmental officers worked closely environmental outcomes with local environmental groups to The Final Environmental Impact Statement for residents, including achieve optimum results in terms of (EIS) for the project was released in late native birds and animals.” flora and fauna management on and 2007 and informed the Environmental around the easement. Management Plan that guided the line’s Cameron Meekin, Program Manager construction. The South Pine to Sandgate “We worked together to identify and EIS identified a range of environmental “Construction works were planned safeguard protected plants specified matters which Powerlink’s design to reduce inconvenience to the in the EIS, while fauna spotters and and construction teams would mitigate community and the businesses located in catchers were brought in to catch and in order to successfully integrate the shopping complex where excavations relocate wildlife before we began this essential infrastructure into the were required to install the cable. This vegetation clearing. community, including the need to minimise included carrying out the excavations of “We also consulted with local wildlife the potential impact of selective the car park in the shopping complex at experts to determine how we could help vegetation clearing on local flora and fauna, night to avoid business hours.” and visual amenity. preserve and enhance wildlife habitat in bushland in the suburb of Fitzgibbon,” Notwithstanding the selection of the he said. route with the least impact, the line still crossed several creeks and rivers, “A large number of native trees were a golf course, a sewage plant site, a planted in the area and 40 new nesting major arterial road and a rail line, and boxes were constructed to provide ran through the car park of a busy homes for species such as the Sugar commercial precinct. Glider, the Squirrel Glider, the Boobook Owl, parrots, and possums. Three glider Program Manager, Cameron Meekin, crossings were also constructed along said that from the outset, community the transmission line. consultation, and cooperation with landowners, businesses, local government, “We’ll continue to look after and monitor local Members of Parliament and these facilities as part of our maintenance environmental groups, were vital to Powerlink worked closely with local program. The new transmission line is due environmental groups and businesses to the project team’s ability to achieve to be completed in late 2009.” minimise the impact of construction of the Peter Briggs, Powerlink’s Environmental positive environmental results. South Pine to Sandgate transmission line Officer, Pine Rivers Koala Care Association’s in Brisbane. (Above) Max Gardener, David and Coral Horstman, Hollow Homes’ Construction Manager, supervises night works Alan Franks and the State Member for Sandgate, Vicky Darling, inspect the nesting boxes at Fitzgibbon

42 powerlink annual report 2008/09 powerlink annual report 2008/09 43 environment

In 2008/09, our biosecurity measures Wildlife and flora protection North Queensland frog study Further enhancing focused on the following areas. Powerlink has an innovative Species In 2008/09, Powerlink continued its rehabilitation works foreseeable 2008/09 Management Program through which commitment to the long-term study Erosion reduction Weed management of frogs in the lowland Wet Tropics we actively identify critical habitat and Vetiver grass, an innovative and Powerlink has a continuous of Queensland, including in the vicinity work with the appropriate organisations cost-effective ‘green’ alternative In 2009/10 and beyond Powerlink will: improvement program for weed of our Tully to Innisfail line. The study, to manage the impact of our operations for managing erosion, has proved a control and management. We work being undertaken by James Cook Report under the National Greenhouse on flora and fauna. Some of our great success on transmission line cooperatively with landowners to University, is examining the Emission Reporting (NGER) scheme. initiatives are outlined below and on projects in the Gold Coast hinterland implement weed management interactions of frog populations the following page. and Lockyer Valley region. Continue to monitor and respond to strategies during the construction with habitat, investigating disease the legislative changes that affect our and maintenance of transmission Mahogany glider program distribution and assessing any impact Erosion, stability and slope protection approach to the environment and lines and substations. The mahogany glider (Petaurus of the construction and maintenance issues in the vicinity of towers and energy conservation. Our field staff and contractors have gracilus) is an endangered species of transmission lines on frog habitat. access tracks have traditionally resulted in rock walls, shotcrete and specific procedures to identify weeds, Innisfail to Edmonton transmission line under both Commonwealth Continue our scientific approach Helicopter stringing remove declared weeds and prevent and State Government legislation. gabion baskets being put in place, to responsible environmental the spread of weeds on clothing, plant This glider species has been In sensitive environmental areas, but these solutions are not always management of our construction and vehicles. Sugarcane smut threatened by loss of habitat Powerlink has developed strategies compatible with local land use, can and maintenance activities. to minimise disturbance of vegetation be expensive, and often require While sugarcane smut has so far and is found only in a small area Powerlink has adopted the University by people and vehicles. One of our ongoing maintenance. been restricted to isolated pockets, between Innisfail and Tully. of Queensland-developed Lucid key initiatives is stringing the cables Powerlink’s Environmental Strategies In late 2008, sturdy vetiver grass Information Support Tool, a portable In cooperation with the University between transmission towers team worked to ensure that Powerlink was identified as a viable option system which helps field staff to of Queensland, CSIRO and the using a helicopter. construction and field staff remained identify plants and choose the right Environmental Protection Agency, following successful trials in parts aware of the potential threat from management strategies. Powerlink has an ongoing program In 2008/09, this technique was of our Greenbank to Maudsland any spread of the smut parasite when to investigate the movements of the used in a number of areas including and Middle Ridge to Greenbank Powerlink presented its review of they are working in sugar cane areas. mahogany glider near our transmission on the Innisfail to Edmonton transmission lines. It is a fast-growing, strategies for the prevention of weed lines and easements. replacement transmission line in hardy, sterile plant with a deep root seed spread to the Queensland Weed Equine Influenza Far North Queensland and on system that binds soil together, filters Symposium Conference 2008. Powerlink was among the first the new South Pine to Sandgate sediment from overland flow, and is organisations in Queensland to Initiatives in 2008/09 also included transmission line in northern Brisbane. also edible for livestock, making it prepare and adopt Equine Influenza an excellent choice for use in the commencement of the Weed We also use helicopters to do protocols in 2007/08. These protocols grazing areas. Seed Destruction project, which will maintenance patrols and inspections remained in place during 2008/09. investigate the potential to further in many areas. Powerlink personnel and contractors From January 2009, 7,500 vetiver enhance weed and seed material continued to take the relevant grass plants were planted at destruction on Powerlink vehicles precautions when working on two Mount Tamborine sites at a and equipment through more efficient properties with horses. The protocols cost 25 per cent to 50 per cent water use and through mechanisms specify hygiene, washdowns, and lower than the cheapest such as vacuum, compressed air and other processes. engineering solution. chemical control.

44 powerlink annual report 2008/09 powerlink annual report 2008/09 45 community approachable

Powerlink works hard to be a responsible and responsive corporate citizen. We are committed to building trust and partnerships with communities near our assets through innovative environmental projects and by supporting initiatives that deliver tangible results for both the communities and Powerlink.

Our responsibility to build and maintain Integrating infrastructure deliverable 2008/09 a transmission network to supply into communities Queensland’s electricity needs gives Under the Integrated Planning Act We launched our $1.3 million us a continuing presence in many 1997, Powerlink is a referral agency Powerlink GreenWorks Queensland communities. As well as for developments adjacent to existing program, which aims to deliver seeking the community’s cooperation lines and easements. We provide high-value environmental and goodwill in accommodating this planning advice and tools to planning outcomes in the vicinity of vital infrastructure, we aim to ensure and development professionals. the proposed 500 kilovolt our presence returns real benefit to These include easement mapping transmission network in local people, landowners and to the services and easement co-use guidelines. South Queensland. local environment. Our planned capital works projects are We completed two We are committed to developing identified in the South East Queensland environmental programs – the long-term relationships that endure Infrastructure Plan and Program and in award-winning Greening Lockyer throughout the planning, development Local Government Growth Management in South Queensland and the and maintenance of our infrastructure. Strategies prepared by local governments Community Environment Fund It is our goal that these relationships in South East Queensland. in the Townsville region. will help us achieve positive, Through our Community sustainable outcomes. Goodwill programs Benefits Program for the Innisfail Powerlink’s goodwill programs are All transmission line planning is to Edmonton transmission line, proactive, community-based projects regulated by a formal process governed we provided funding for 17 local that aim to build relationships with local by legislation, primarily the Integrated community groups to undertake government, communities and other key Planning Act 1997. It includes valuable community projects. stakeholders in strategic areas traversed Environmental Impact Statements, by existing or future Powerlink We continued to build community consultation and government transmission infrastructure. Through the relationships with local approval. We aim to identify routes implementation of these programs, we government stakeholders that enable us to meet our legislated aim to work with local communities following the local government reliability of supply obligations at the Powerlink is committed to amalgamations in 2008. to reduce the visual impact of new least long-run cost to consumers, or existing infrastructure, providing We provided sponsorship while minimising overall impacts. developing long-term relationships environmental outcomes and long-term support to a number of To this end, we implement strategies community, industry, education benefits to communities and in doing so, that endure throughout the planning, to build and maintain cooperative and environmental organisations generate lasting positive relationships at relationships with affected landowners, across Queensland. all levels of the community. development and maintenance of councils, interest groups and residents (continues overleaf) of the 30 city and regional council areas our infrastructure. in which we operate. Powerlink’s planning processes ensure its essential infrastructure is effectively integrated into communities

46 powerlink annual report 2008/09 powerlink annual report 2008/09 47 community

supportable: New GreenWorks program to support lasting environmental outcomes

The 500 kilovolt transmission lines “In the lead-up to the program’s launch, “A Steering Committee made up of planned for the next decade will mark we appointed specialist environmental representatives from the local councils the beginning of a new era in Queensland consultants to undertake a detailed and Powerlink has assessed the potential electricity transmission. In keeping with study of environmental factors along projects, with guidance from an Advisory this landmark commitment, Powerlink the proposed transmission line and to Panel of environmental representatives,” launched a major new community identify potential projects,” Terry said. Terry said. environmental program in 2008/09 which will directly benefit communities “Powerlink looks forward In April 2009, funding was allocated to six major projects to be undertaken in the vicinity of the new 500 kilovolt to working with community transmission lines in South Queensland. by community environmental groups. and environmental groups The projects are located across South It will contribute $1.3 million to to deliver lasting outcomes Queensland in areas including Crow’s environmental projects over the next Nest, Ravensbourne, Purga Nature four years within the Ipswich City Council for both the environment Reserve, Mt Binga Road Gully and Cooyar, area and in the regional council areas of and the community through Emu and Woolshed Creeks. They will Lockyer Valley, Somerset, South Burnett their involvement with focus on protecting and enhancing and Toowoomba. the connectivity of native vegetation, GreenWorks.” rehabilitating wildlife corridors, managing Manager Network Development, erosion, reducing salinity in waterways Terry Miller, said the development of Terry Miller, Manager Network Development and improving downstream water quality. the GreenWorks program demonstrates A significant project in both Lockyer Valley Powerlink’s desire to build goodwill and “This Environmental Review process and Somerset Regional Council areas will participate in creating lasting benefit also included consultation with relevant work to protect the endangered Swamp for the community. It works in close stakeholders such as the councils, Tea-tree (Melaleuca Irbyana) by managing Bronwyn Ford, GreenWorks Program Manager, cooperation with local government and SEQ Catchments, Greening Australia fire risk, weeds and incompatible land uses. with Bruce Lord from SEQ Catchments and will proactively protect and enhance and Landcare. Bruce McLennan from Greening Australia. local environmental values. The GreenWorks program is also They are pictured at one of the sites that expected to provide employment and forms part of the Enhancement of Biodiversity educational opportunities. Values in the Emu Creek, Ravensbourne and Crows Nest Districts Project

(continued from page 46) The program is being delivered in A Steering Committee was formed to Dalby Community The successful projects included Greening Lockyer In 2008/09, Powerlink completed partnership with representatives from assess and select projects to be funded Environmental Program carrying out weed control along 2008/09 saw the completion of multi-year programs in the Lockyer Lockyer Valley, Somerset, South Burnett through the program, with the first six In October 2008, Powerlink launched its Jandowae Creek, planting native Greening Lockyer, a community and Valley and Townsville, and embarked on and Toowoomba Regional Councils and projects to receive funding announced in Community Environmental Program in species and constructing a shade environmental program initiated by a new four-year program in the vicinity Ipswich City Council. April 2009. A program manager was partnership with Dalby Regional Council. shelter at the Jandowae Rotary/RSL Powerlink in partnership with the appointed in May 2009 to oversee the park, constructing a green cultural arts of the future 500 kilovolt network, and a In advance of the proposed new The program provides $200,000 in Somerset and Lockyer Valley Regional program’s implementation. (See case space in Bell, undertaking rehabilitation community and environmental program 500 kilovolt transmission lines in funding for community environmental Councils (the former Esk, Gatton and study above for more details.) works along Myall Creek, installing an in the Dalby region. the region, we have introduced the projects to be completed in the vicinity Laidley Councils) and the former environmentally friendly amenities Powerlink GreenWorks program to of Powerlink transmission infrastructure Western Sub-Regional Organisation New GreenWorks program launched block at Cooranga North Recreational provide funding and support for projects in the Dalby area. The program, being of Councils (WESROC). Reserve and several rehabilitation/ Powerlink’s new $1.3 million that will deliver significant environmental run in conjunction with Dalby Regional revegetation projects proposed environmental GreenWorks benefits and enhance the visual amenity Council and South Burnett Regional by the Brigalow Jimbour Flood program, which was launched in for communities in the vicinity of the Council, encouraged local groups to Plains Group. December 2008, will fund worthwhile easements for the future lines. submit ideas for funding. Six community environmental projects near our future groups successfully secured $93,000 in 500 kilovolt powerline easements in funding as part of the first round of the South Queensland. program in March 2009.

48 powerlink annual report 2008/09 powerlink annual report 2008/09 49 community

The initial three-year program Funded by a $500,000 grant from In 2008/09, we also announced was established in 2003, with $1 million Powerlink and $500,000 from project Community Benefits Programs would in funding from Powerlink, and aimed partner Townsville City Council (and be run in association with our South to enhance the Lockyer Valley’s the former Thuringowa City Council), Pine to Sandgate and our Bouldercombe environment, to minimise the impact the Community Environment Fund to Pandoin transmission line projects. of electricity infrastructure, and to delivered outstanding community A Community Benefits Program will also create employment and training and environmental outcomes across be introduced for our projects in the opportunities for local residents. 27 projects in the Townsville region. Nebo Region, including the Nebo to In 2005, Powerlink contributed an QR Bolingbroke and the Nebo to Local wildlife habitats were improved, additional $240,000 towards a three- Strathmore transmission line projects. biodiversity was enhanced, and new year program dedicated to maintaining recreational and green spaces were Greening Lockyer project sites. Burnett Catchment Care created for local residents and visitors Association Washdown Project Jasmine Oakes, Community Environment In late 2008, we provided funding for to enjoy. The program also provided Powerlink provided funding to the nine community groups to hold events at training and education opportunities for Fund Program Coordinator, at the Dalrymple Simon Bartlett, Chief Operating Officer, with representatives from community groups which Road project site in Townsville Burnett Catchment Care Association to received funding in Powerlink’s Nebo Region Community Benefits Program their project sites to celebrate their past local students and the unemployed, and upgrade a community weed washdown efforts and work together to undertake helped minimise the long-term visual facility in Eidsvold (south of Biloela). During 2008/09, we provided funding additional maintenance works. These impact of Powerlink’s high voltage The weed washdown bay was originally These include activities and organisations In 2008/09, Powerlink continued to for communities through two events enabled community members to electricity infrastructure in the region. established by Powerlink in association that align with our projects in regional proactively provide information about reflect on the success of their project, Community Benefits Programs: Queensland, plus key industry and local EMF to communities in the vicinity of Across the program, 33,000 trees with construction of our Calvale to and acknowledge the ongoing groups such as Local Government our transmission lines, and continued our were planted, 80 hectares of weeds The Innisfail to Edmonton Tarong transmission line, and required commitment and enthusiasm from Association of Queensland, Landcare practice of carrying out EMF readings at were cleared, and 77 hectares of native Transmission Line Community new equipment to be installed. volunteers throughout the program. Queensland, Queensland Planning the request of landowners. EMF readings habitat were enhanced. In addition, Benefits Program distributed funds to The construction of the washdown Institute, Engineers Australia and at the edge of a typical Powerlink Throughout the program, across 2,100 volunteers contributed 23,000 17 community groups from the bay was completed in March 2009. The Smith Family. easement are generally similar to those 20 projects, 2,660 community members volunteer hours, and nearly 550 Cassowary Coast and Cairns Regional Consistent with Powerlink’s encountered by people in their daily contributed 7,500 volunteer hours and employment and training opportunities Council areas in June 2009. commitment to responsible weed Smith Family Christmas activities at home or at work. assisted with planting 40,000 trees. were created. Projects funded included: the control and management, the In 2008, Powerlink provided financial In addition, 240 employment and training In 2009/10, Powerlink and the Townsville construction of a storage shed at the community facility will continue be used support to the Smith Family Christmas opportunities were created. Prudent City Council will build on the success of Babinda Community Kindergarten; by Powerlink staff and contractors to Appeal which assists the not-for-profit management and community networking the Community Environment Fund to re-roofing the Queensland Country support ongoing maintenance activities organisation to improve the education foreseeable 2008/09 ensured the projects were successful in establish a ‘learnscape’ at one of the Women’s Association hall at Deeral; in the region. of Queensland children. Powerlink staff attracting significant in-kind support, program’s project sites, where purchasing a fridge and freezer for were offered a number of ways to considerably increasing their value. Volunteer Marine Rescue environmental education opportunities the Etty Bay Surf Lifesaving clubhouse; In 2009/10 and beyond Powerlink will: Gladstone Project support the Smith Family ranging from The success of the program was will be created. The Borrow Pits to and establishing a natural resource financial donations to the opportunity Implement our Community Powerlink contributed a surplus steel recognised beyond Queensland. Rowes Bay Learnscape project will management library for the Russell to volunteer their time for Christmas Benefits Program in association The program won several major awards, involve environmental and infrastructure Landcare group. lattice tower to the Gladstone Volunteer activities that included toy sorting and Marine Rescue group, which erected the with our South Pine to Sandgate including the Prime Minister’s Award enhancement works at the Borrow In consultation with the Whitsunday hamper deliveries to families. and our Bouldercombe to Pandoin for Community Business Partnerships Pits (adjacent to Powerlink’s Ross tower in the Gladstone hinterland and Regional Council, a grant was transmission line projects, and our in 2006, the Healthy Waterways Substation), and the development and installed a new radio transmitter at the Electric and Magnetic Fields provided to the Collinsville Junior projects in the Nebo Region, including Government Award and Grand Prize implementation of eco-tours at, and top of the tower. The new transmitter Powerlink takes its advice about Rugby League Club in lieu of holding the Nebo to QR Bolingbroke and in 2005, and the National Local between, the Borrow Pits and the was commissioned in October 2008. Electric and Magnetic Fields (EMF) from a Community Benefits Program in the Nebo to Strathmore transmission Government Association Community Rowes Bay Wetlands. This has provided enhanced radio recognised health authorities in Australia the region given that the club is a coverage to the outer reef, helping line projects. Capacity Building Social and Community significant focus for community and internationally. Engagement Award in 2004 and 2005. Community Benefits Program improve efficiency, safety and Commence on-ground works for activity. The grant will fund the While there is no scientifically proven For over a decade, the Powerlink communications for search and upgrading of the electrical wiring at causal link between EMF and adverse the six projects funded through Community Environment Fund Community Benefits Program has rescue operations. the clubhouse and the new floodlights affects on human health, Powerlink takes our GreenWorks program. The three-year, $1 million Community provided funding for community projects for the playing field. Community and industry sponsorship an approach of ‘prudent avoidance’ in Environment Fund, which drew to a that contribute to the establishment of Implement the new community siting new powerlines. This includes close at the end of 2008, allowed facilities and services for communities in Powerlink’s sponsorship framework and environmental partnership with seeking to locate powerline easements industry, local government and the proximity of our new transmission lines. supports the strategic sponsorship Townsville City Council – the Borrow away from houses, schools and other community to work together to improve of activities in the areas of community, Pits to Rowes Bay Learnscape Project. buildings, where it is practical and cost the environment for the benefit of education, environmental and effective to do so. future generations. industry activities.

50 powerlink annual report 2008/09 powerlink annual report 2008/09 51 our people knowledgeable

Powerlink has a highly skilled, capable and dedicated workforce which forms a cohesive organisation possessing the skills and culture to keep us at the forefront of transmission reliability and efficiency.

Over the past three years in response to New Workplace Agreement deliverable 2008/09 the requirements of our significant The Working at Powerlink 2008 Union capital works program, we have steadily Collective Agreement was lodged with Following strong growth in and strategically grown our workforce. In the Workplace Authority in November our workforce numbers over 2008/09, this growth steadied to a much 2008. The new three-year Workplace the past three years to cater lower 1.8 per cent, in comparison to the Agreement is a collective agreement for our record capital works rates of growth in preceding years of five with the unions that represent program, our staff numbers per cent in 2007/08, and 16 per cent in employees at Powerlink. are now expected to remain 2006/07. This brings our workforce to a at around 1,000 for the next total of around 1,000 men and women Safety as an integral value few years. employed in a variety of professional, Powerlink is committed to achieving Our new Workplace technical, trade, specialist, and operational excellence in safety through Agreement was negotiated administrative roles. the creation and continuous during the period. The majority of Powerlink’s employees improvement of a culture in which all We continued to develop are based at our head office at Virginia employees regard safety as their first our senior leadership and in Brisbane. However, five temporary priority, and in which safety is management training, and our construction site offices accommodate systematically and actively integrated graduate programs continued staff working on projects in regional into all work. to encourage young people Queensland. Powerlink has comprehensive policies with the potential to be a part and procedures to monitor and report of Powerlink’s success. The safety and wellbeing of our staff is a central focus, with safety being on safety. The Safety Steering We were involved at a national promoted and supported as a core Committee reports regularly to the level in developing the first draft life value within the organisation. Board’s Audit and Compliance of uniform High Voltage Live We comprehensively reviewed our Committee and develops programs to Work Standards. safety strategies in 2008/09, and also improve safety awareness and safe Our staged Pandemic Emergency continued to be actively involved in practices. Safety is integrated into all Plan was activated in response defining national standards for electrical aspects of work and is also promoted as to Influenza H1N1 virus construction work and safety standards. a core life value, enhancing employees’ (swine flu). awareness of risk and health issues in all By developing the potential of existing areas of their lives. staff, awarding innovation and supporting (continues overleaf) a strong graduate program, we aim to strengthen Powerlink’s capabilities to maintain our highly competent and committed workforce. Powerlink works to ensure safety is a top priority Powerlink is committed to achieving for its employees and contractors. Chris Haas, Training and Safety Advisor, during safety training in Far North Queensland operational excellence in safety.

52 powerlink annual report 2008/09 powerlink annual report 2008/09 53 our people

workable: Powerlink’s future capabilities assured through a supportive apprenticeship program

Powerlink’s apprenticeship program “Powerlink currently has Communication Repeater sites, and of prepares participants to excel in the the sophisticated control systems in electricity industry, and gives a broad 35 apprentices across our substations. base of practical knowledge so they can the three apprenticeship work effectively either at Powerlink programs, at different stages Kerri has relished these challenges, which or in other related organisations. have confirmed her career choice. “I have in their competency-based always had an interest in learning about Our apprenticeship program has three training, which typically electronics and my father, who has done distinct, well executed streams (Lines, contract work for Powerlink for some Substations and Secondary Systems), takes four years.” time, assured me that I would receive and most of our apprentices graduate Kerri Harvey, Secondary quality training, education and experience.” to a permanent position within the Systems Apprentice organisation, helping us to attract some “My goal now is to get a job as an engineering officer in Powerlink’s of the best-qualified new recruits. “I think starting an apprenticeship is Communication and Controls area and somewhat daunting for anyone. The thing to continue to develop my knowledge One such recruit is Kerri Harvey, one of a that made it easier for me was the and skills.” small number of female apprentices since support, guidance and encouragement Powerlink’s inception to undertake the that I received from everyone I worked Secondary Systems apprenticeship within with in Secondary Systems,” Kerri said. the Network Field Services area. Now in the third year of her While Powerlink works hard to apprenticeship, Kerri has already ensure there are no gender-based had the opportunity to gain practical barriers, Kerri is more focused on the experience of the innovative fibre optics (at left) Kerri Harvey receiving her supportive environment that helps all communications technology used in our scholarship at the Electro Group of our apprentices to integrate into Dense Wave Distributed Multiplexing Annual awards. the organisation and to develop (DWDM) communications, of travelling their capabilities. (this page) Chris Bohan, Communications to different field sites, including remote and Control Engineering Officer, with Nichole Willett, Field Test Apprentice.

(continued from page 52) Safety in design The Electrical Safety Act 2002 requires an Developing national safety standards Personal health and safety Leadership and management New safety initiatives included: Incorporating safety considerations approved auditor to certify Powerlink’s Commonwealth and State Governments The health and wellbeing of our development Safety Management System annually. With the growth of Powerlink’s field assessment and evaluation at the design stage of infrastructure have been working towards uniform employees is a core Powerlink value, The audit was completed in September responsibilities and workforce, the of new height safety equipment is an important element of a occupational health and safety across demonstrated through the number comprehensive approach to safety. 2008 and our system was found to be the country. Powerlink has contributed of programs we provide to encourage management team has also grown, review of laser safety We continued to improve our expertise well-developed with no non-compliances to the first draft of High Voltage Live and protect staff health. with many managers promoted from in this area during 2008/09 with the recorded. The audit also noted strong Work Standards. This process involves within the organisation. The training development of a new training course In 2008/09, included among these introduction of enhanced data and commitment by management to support liaison with unions, safety committees, and development of managers remained on the Electrical Safety Act Code of programs was the Sun Safe Program, performance indicators. electrical safety and that field staff consumer groups, professional an important priority in 2008/09 Practice for Working Near Exposed Live which offered employees access to a assessed during unannounced visits associations and other stakeholders. and took into account potential career Parts, undertaken in conjunction professional skin screening and was Safety performance monitoring also showed good knowledge and paths and the needs of technical experts with ElectroGroup Training backed by an educational program Powerlink’s Lost Time Injury Frequency commitment to safety. moving into a multi-faceted management for workers in high-risk areas. review of substation earthing Rate for 2008/09 was 1.72, which is role. Training is targeted at three

to identify risks and optimum consistent with industry norms. Powerlink also offers flu injections levels – Managing Self and Teams design principles to employees. for Performance, Management to

Leadership, and Senior Leadership review of contractor risk management Development Program. on demolition work.

54 powerlink annual report 2008/09 powerlink annual report 2008/09 55 our people

The following improvements were introduced in 2008/09: foreseeable 2008/09 review of the content and delivery of the Managing Self and Teams for Performance program In 2009/10 and beyond Powerlink will:

development of Management to Continue to monitor national safety Leadership competencies and developments that impact our work tailoring of the program to individual processes, practices and responsibilities, needs with the three main and to refine our processes accordingly. competencies now delivered in-house Continue to develop our management incorporation of the Covey and leadership training, with a focus on Leadership course into the performance management training. Management to Leadership program. Powerlink employees and contractors participate in safety training during the Innisfail David Lorimer, Quality Inspector, at the Townsville Site Office Staff training and development to Edmonton transmission line replacement project Powerlink’s range of development programs helps us to attract and Development programs Pandemic Emergency Plan Our people’s achievements Tony Gillespie, Gary Russell and retain skilled employees and ensures Seventy-seven people participated For both the wellbeing of our staff Congratulations to Powerlink employees Brian McMahon were awarded our people have the right skills, in Powerlink’s development programs and the continuity of our operations, who were recognised by external Fellowships by the Institute of knowledge and capabilities for their in 2008/09. The programs give containment of serious infectious viruses organisations for their outstanding Engineering and Technology. To be professional challenges. All Powerlink participants the opportunity to gain is essential. Powerlink’s Pandemic achievements. These included: recognised as a ‘Fellow’, a member staff receive induction and safety broad experience in their field, with Emergency planning was activated and must be nominated and their Simon Bartlett, Powerlink’s Chief training. Our training and career work experience across a variety of refined in response to the outbreak of achievements are reviewed by a Operating Officer was presented planning system encourages individuals business units. Currently we have Influenza H1N1 virus (swine flu). senior panel of engineering experts with the Institute of Engineering to develop their potential and prepare programs for graduate engineers, who look for exceptional knowledge, and Technology’s highest honour, for roles that will meet our future engineering officers, environmental Powerlink Excellence Awards experience and contribution to the the Sir Lionel Hooke Award, in capability needs. Staff have opportunities professionals, information technology While acknowledging that Powerlink’s engineering profession. recognition of his exceptional to enhance their skills through in-house graduates, administration trainees performance is a team achievement, achievements nationally and professional and personal development and apprentices. with valuable contributions from all of internationally. Simon completed workshops, and can also apply for our staff, our annual Excellence Awards In 2008/09, we updated policies and a remarkable year with a second financial assistance for relevant are an opportunity to applaud those procedures across the programs and the major award – the very prestigious tertiary courses and secondments. individuals and teams who have created committees for the different programs ‘Australian Professional Electrical a worthwhile innovation. collaborated to share understanding Engineer of the Year’ award from and ideas. The 2008 awards featured an impressive Engineers Australia range of technical, business and Our graduate programs are an environmental achievements, resulting important facet of ensuring we have a in the presentation of two gold, three well-qualified workforce to meet our silver and three highly commended future needs. awards. The winning entrants included an innovative design to overcome electromechanical oscillations on the Queensland/New South Wales Interconnector circuits and the portable under-crossing barrier (also see page 23).

56 powerlink annual report 2008/09 powerlink annual report 2008/09 57 corporate governance accountable

Corporate governance guidelines Corporate governance in Powerlink Details relating to Powerlink Directors, Powerlink’s corporate governance Corporate governance reflects the Board Committee composition, and processes are consistent with Corporate manner in which Powerlink conducts meetings in 2008/09 are set out in Governance Guidelines for Government its business. Powerlink is a corporation the Directors’ Report. Owned Corporations (“Guidelines”) established under the Government Principle: foundations issued by the Queensland Government. Owned Corporation Act 1993 (GOC Act), of management and oversight and is a registered public company under The Guidelines have been prepared The Board has a Code of Conduct that the Corporations Act 2001. having regard to the: guides Directors in carrying out their Powerlink is committed to governance ASX Corporate Governance duties and responsibilities, and sets policies and practices that provide Council’s Corporate Governance out expected standards of behaviour. appropriate accountability and control Principles and Recommendations A summary of this document is available systems that encourage and enhance 2nd Edition (ASX Principles) on Powerlink’s website. sustainable business performance. Auditor-General’s Report No. 2 The Board Charter, established by the The Board of Directors is responsible 2002-2003 – Review of Corporate Board, describes the Boards functions to shareholding Ministers of the Governance and Risk Management and responsibilities, which are to: Queensland Government. In 2008/09 at Government Owned Corporations Set the corporation’s values the two shareholding Ministers and standards of conduct Auditor-General’s Report No.10 were the: 2002-2003 – Review of Management’s Provide leadership of the corporation Treasurer and Minister for Assessment of Fraud Control Risks within the framework of prudent Employment and Economic and Associated Plans and Procedures and effective controls Development OECD Principles of Corporate Provide guidance and set the Minister for Natural Resources, Mines Governance corporation’s direction, and and Energy and Minister for Trade. Crime and Misconduct Commission development of strategies (Queensland) and Independent The Board and objectives Commission Against Corruption The Powerlink Board is responsible Set financial objectives and (New South Wales) – Managing for the overall corporate governance ensure that all necessary resources Conflicts of Interest in the Public of the corporation and its subsidiary are available for the business to Sector – Guidelines and Toolkit. companies, setting the organisation’s meet its objectives strategic direction, setting goals for Monitor implementation of management, and establishing the strategies and performance policies and operational framework for the corporation. (continues overleaf)

Queensland/New South Wales Interconnector

58 powerlink annual report 2008/09 powerlink annual report 2008/09 59 corporate governance

(continued from page 58) The Board reviews annually the Principle: safeguard Principle: respect the rights Remuneration Committee Inform shareholders of key issues, individual and collective performance of integrity in financial reporting of shareholders major developments and performance the Directors and the Board to assure The Board has established two The Powerlink Board has a Chairman: Walter Threlfall itself that it operates in accordance with Board Committees to assist in fulfilling communication strategy to promote Ensure an effective system for its Charter and the discharge of its its corporate governance responsibilities Members: John Goddard effective communication with compliance and risk management Julie Beeby responsibilities. – the Powerlink Audit and Compliance shareholding Ministers. The Board aims is in place. Else Shepherd A key element in this evaluation is Committee and the Powerlink to ensure that shareholding Ministers The charter is publicly available on considering the continuing education and Remuneration Committee. are informed of all major developments Powerlink’s website. The Board and The Remuneration Committee affecting the corporation’s state of professional development of Directors. These committees have documented management work together to establish recommends employee remuneration affairs. This includes regular meetings mandates that are reviewed on a and maintain a legal and ethical The Board undertook its review in policies that will attract and retain a and information communicated formally regular basis. The membership of both environment and framework that October 2008 and concluded that skilled and motivated workforce. through quarterly progress reports and committees consists of non-executive ensures accountability. it is fulfilling its role with no obvious the Annual Report. gaps in its performance, and that there Directors. Details of committee Principle: make timely The Powerlink Board undertakes was good interaction and relations members, number of meetings during and balanced disclosures Each year Powerlink prepares a an annual evaluation of the performance with both shareholding Ministers and the year and attendance are presented Powerlink has established processes Statement of Corporate Intent (SCI) and of the Chief Executive. The Chief Powerlink’s management. in the Directors’ Report. to ensure it meets its disclosure and a five year Corporate Plan, reflecting the Executive evaluates the performance of reporting obligations, including those to outcomes of a comprehensive strategic A structured internal process has Audit and Compliance Committee each senior executive and submits the shareholding Ministers. Powerlink’s and business planning process involving also been established to review and outcomes of the evaluation to the Board reporting arrangements include the the Board and the Executive Leadership evaluate the performance of Board Chairman: Christina Sutherland for its consideration. Powerlink Annual Report, regulatory Team. Both documents are presented to Committees. Each Board Committee Members: John Goddard reports, Powerlink website and other shareholding Ministers. Principle: structure submits an Annual Report of its activities Ken Howard public disclosures. the Board to add value to the Board. Quarterly progress reports on the

At 30 June 2009 the Board comprised The Board’s recommendation performance against the SCI is prepared The Audit and Compliance Committee six independent non-executive Principle: promote ethical and on dividends is made after due by the Board for shareholding Ministers. assesses and reports on issues relating Directors. All Directors are appointed responsible decision-making consideration of a range of factors to financial integrity, corporate processes Principle: Recognise and manage risk by the Governor in Council. Details The Board has developed a Code of including the corporation’s financial for compliance with laws and regulations, of the skills and experience of each Conduct and Share Trading Policy, which result, its capital structure and business Management regularly reports to codes of conduct, business risk Director are presented separately in is available on the Powerlink website. credit rating, future capital investment the Board on key business risks. management and audit effectiveness. the Corporate Governance section. requirements, the return shareholders A management committee structure Each Director has a responsibility also operates in parallel with the Board The Directors’ Report discloses the to declare any related interests, which The Committee endorses the expect from their investment, and the terms of office and appointment date corporation’s internal audit program and capacity to pay dividends, given prudent Committees to address issues of are appropriately recorded, and assessed environmental management, workplace for each Director. for materiality on a case-by-case basis. risk management profile, and provides a financial management. link between the corporation’s auditors health and safety, security and corporate A procedure has been developed by Where appropriate, the Director (internal and external) and the Board. emergency response. Each of these the Board should Directors require does not participate in the Board’s The Committee is responsible for committees submits reports to the independent professional advice at the consideration of the interests disclosed. considering the annual statutory financial Audit and Compliance Committee expense of Powerlink. All Directors, All Powerlink Directors and statements for subsequent approval through the Chief Executive. including the Chairman, continue to management are expected to act by the Board. exercise independent judgement in with integrity and strive at all times the conduct of their responsibilities. to enhance the reputation and performance of the corporation.

60 powerlink annual report 2008/09 powerlink annual report 2008/09 61 corporate governance

The Environmental Steering Powerlink’s remuneration policy Award employees may be eligible Shareholding Minister Directions Corporate Entertainment Committee develops appropriate is designed to: for performance-based payments Shareholding Ministers issued the and Hospitality strategic responses to environmental that are delivered as gainsharing and Attract and retain talented following directions in 2008/09: The Queensland Government issued issues, as well as ensuring compliance performance pay. Gainsharing is a people with the skills to plan, the GOC Corporate Entertainment and with Powerlink policies and relevant payment available to award employees, 3 December 2008: Application develop, operate and maintain a Hospitality Guidelines in September 2008. environmental legislation. subject to Board approval, provided that of Purchasing Carbon Offsets large world class electricity Powerlink’s corporate entertainment the Corporation’s profitability target has for Queensland Government Air The Safety Steering Committee transmission network; and and hospitality expenditure for 2008/09 been exceeded, and that performance Travel Policy develops and directs Powerlink’s totalled $53,489. The table below Reward and provide incentives against key organisation performance workplace health and safety 5 December 2008: Application of presents individual events above $5,000. for exceeding the key business measures has been achieved. management practices, and also ensures QFleet ClimateSmart Action Policy performance targets. Event Date Cost that Powerlink complies with relevant Performance pay is based on individual 17 February 2009: Application of The remuneration policy provides Staff Recognition November $7,796 workplace health and safety legislation. or small team performance targets, State Procurement Policy. – Network 2008 for performance-based payments which are reviewed half yearly, and rated The Security Steering Committee Field Services for all permanent employees, with at the end of the annual performance Amendment to Statement provides guidance in the development Staff Recognition December $13,354 the payments directly linked to the cycle. The individual performance targets of Corporate Intent and approval of the Powerlink Security – Engineering 2008 performance of the individual or are aligned with the overall business On 16 December 2008, the Powerlink Plan. The Committee reviews security & Projects small teams against pre-agreed targets of the corporation. Board approved modifications to incidents and considers necessary Staff Recognition December $5,321 performance targets, and to the the Powerlink 2008/09 Statement amendments to the plan in response Managers and senior staff are – Operations 2008 performance of the business. of Corporate Intent to incorporate to these events. employed on management contracts. the requirements of the GOC The Working at Powerlink 2008 Powerlink’s remuneration policy for The Corporate Emergency Response Corporate Entertainment and Hospitality Union Collective Agreement commenced contract employees uses the concept Committee develops appropriate Guidelines. Shareholding Ministers on 20 November 2008 and will remain of Total Fixed Remuneration (TFR), strategic responses to corporate were subsequently notified of the in force for a period of three years. which includes employer superannuation emergencies and is responsible for Board approved modifications. The Agreement will continue in force contributions. In order to promote maintaining corporate emergency after its nominal expiry date until such management focus, the policy provides management documentation. time as it is replaced or terminated for performance-based payments Principle: remunerate by law. dependent on the performance against pre-agreed business and fairly and responsibly The Agreement provides a mechanism individual targets. The TFR level Powerlink seeks to develop individuals for Powerlink and its employees to is reviewed annually based on to possess the competence and respond to changes in an environment consideration of economic and motivation necessary to excel in an of increasingly challenging targets set individual capability factors. environment of high achievement. by our owners and regulators. It has a High priority is given to selecting the focus to continue to develop Powerlink best person for the job at all levels in into a competitive and satisfying place the organisation, and investing in that to work. It recognises that the economic person’s potential through further health of the company and the wellbeing training and development. of all employees depend upon the success of a shared commitment by all parties to this Agreement.

62 powerlink annual report 2008/09 powerlink annual report 2008/09 63 corporate governance board of directors

Else Shepherd AM Julie Beeby John Goddard Ken Howard Christina Sutherland Walter Threlfall Hon FIEAust, FTSE BSc (Hons I), PhD (Physical Chemistry), F. Fin, MAICD CFA, LLB, BEcon, JP BLaw, MAIC BE(Hons Elect), CPEng, RPEQ, FAICD, FAIM, MBA, GAICD MSDIA, GAICD Grad Dip Mus (QCM), A Mus A Chairman of the Board Board Member (Appointed 2008) Board Member (Appointed 2006) Board Member (Appointed 2007) Board Member (Appointed 2001) Board Member (Appointed 1994) (Appointed 1994) Julie has worked in the minerals and Until his retirement in 2007, John was a senior Ken is a private client adviser and the Christina is a solicitor of the Supreme Walter has been an official of the Else is currently a member of the Brisbane petroleum industries in Australia for 21 years executive of the Bendigo Bank Group and Responsible Executive (ASX) and Court of Queensland and the High Court of Electrical Trades Union (ETU) of Australia City Works and Brisbane City Design and her career has included work for several the Managing Director’s representative in Responsible Manger (Australian Financial Australia. She was admitted as a solicitor in – Queensland Branch since 1977. In 2006, Advisory Boards, Deputy-Chairman of the major Australian resources companies. Queensland. He joined the Bank in 1997 as Services Licence) for the Brisbane dealing 1989 after serving two years of articles. he retired as Assistant State Secretary of CEO of its Italian banking subsidiary, Cassa room operations of ABN AMRO Morgans the ETU Queensland Branch, a position in International Riverfoundation, member Julie commenced her career in mineral She has represented insurers and Commerciale Australia Ltd, and from 2000, Limited, Australia’s largest regionally had held since 1983. In this role, Walter of the Council Board of the International processing research, and went on to develop commercial clients and has acted for drove the Bank’s acquisition and integration represented stockbroking firm. represented the interests of ETU members Electrotechnical Commission and Trustee her project and business skills through a clients in employment and industrial matters. of Ipswich-based First Australian Building in North and Western Queensland. of the Brisbane Girls Grammar School. succession of successful senior management Prior to joining the Powerlink Board, Ken She has a strong interest in occupational Society into a state wide banking business. Else Shepherd is one of only a handful of positions in chemical plant, coal bed methane, was a Director of ENERGEX Retail Pty Ltd. health and safety matters. Early in his career, Walter worked as an explosives and mining areas. John’s previous career included senior Electrical Fitter and Mechanic in the steel women to chair large Australian corporations, Ken is a member of the Chartered Financial Christina is Chairman of the Powerlink Board’s executive posts at St George Bank and manufacturing, electrical contracting, and the result of a successful engineering career in Julie is a Director on the Board of CRC Mining Analyst (CFA) Institute, the Securities and Audit and Compliance Committee. the World Bank in Papua New Guinea. mining industries. the sugar, telecommunications, and electricity (CMTE Pty Ltd), Australian Coal Association Derivatives Industry Association, the industries. For her contribution to engineering, Low Emissions Technology Pty Ltd and John is Chairman of The Cooper Property Australian Institute of Company Directors He is Chairman of the Townsville Regional education, and the electricity generating Australian Coal Research Pty Ltd and an Group, Chairman of South East Qld and the Australian Shareholders Association. Group Apprenticeship Scheme (TORGAS industry, Else was awarded a Member of the Alternate Director on the Australian Coal Community Telco Ltd, Director of The Inc), member of the Barrier Reef Institute Ken is a member of the Powerlink Board’s Order of Australia (AM) in 2003. Else was Association Pty Ltd and Queensland Eidos Institute Ltd, Board of Advice of TAFE Council, Chairman of the Townsville Audit and Compliance Committee. also presented with the Centenary Medal to Resources Council. Julie is also Chairman Member of the Qld Aboriginal and Torres TAFE Education Training Advisory Group recognise her achievements and service to of the Queensland Resources Council Strait Islander Foundation and Trustee of (ETAG), and a Director of the Electricity Australian society in the field of information Environmental Committee. the Ipswich Arts Foundation. Supply Industry Superannuation Scheme technology. She is a Fellow of the Australian (ESI Super). Academy of Technological Sciences and She is a member of the Powerlink Board’s John is a published author and is a Fellow of Engineering, and is an Honorary Fellow Remuneration Committee. the Financial Services Institute of Australia. Walter is Chairman of the Powerlink Board’s Remuneration Committee. of Engineers Australia. He is a member of the Powerlink Board’s Else is a member of the Powerlink Board's Audit and Compliance Committee and Remuneration Committee. a member of the Powerlink Board’s Remuneration Committee.

64 powerlink annual report 2008/09 powerlink annual report 2008/09 65 corporate governance executive leadership team

Gordon Jardine Simon Bartlett Maurie Brennan Stewart Bell Ray Di Marco Gary Johnston BE(Hons), BCom, MSc (Environmental), BE(Hons), BSc, FIEAust, FATSE, BBus, MBA, CPA, FAICD BEng, PhD, MBA, CEng, MIET BE(Hons), MBA, CPEng, RPEQ, MACS, GAICD BA (Hons), MAPS, MAHRI FAICD, FAIM, FATSE FAICD, CPEng, RPEQ

Chief Executive Chief Operating Officer Chief Financial Officer Manager Procurement Manager Operations Manager Human Resources and Development Since 1995, Gordon has held the position In his role as Chief Operating Officer, Maurie has provided strategic financial As Manager Procurement, Stewart has In his role as Manager Operations, Ray leads of Chief Executive of Powerlink. He is a Simon is responsible for managing all aspects and commercial advice to public sector responsibility for setting contractual terms and Powerlink’s Operations Business Unit, which Gary has responsibility for the development member of the Reliability Panel of the of Powerlink’s transmission network to organisations in Queensland’s electricity conditions, sourcing suppliers, determining delivers a range of specialist services to and implementation of Powerlink’s workplace National Electricity Market, and is the ensure that our transmission services meet industry since 1979. market strategies and managing the supply Australian and international clients, including and industrial relations, occupational health Chairman of Grid Australia, the organisation Queensland’s rapidly growing electricity needs chain and the commercial administration of power system operations, asset monitoring, At Powerlink, Maurie manages all finance, and safety, electrical safety, corporate and which represents the owners of Australia’s reliably and cost-effectively, and in a way supply arrangements for Powerlink’s capital information technology, telecommunications, tax, treasury, business planning and analysis, employee development, equal employment electricity transmission networks. He is also that satisfies the expectations of our projects and operations. oil testing and research and development. corporate services, internal audit, insurance, opportunity, technical and training the Chairman of ElectraNet SA, the South stakeholders, including our shareholding legal and risk services, and shareholder Stewart has more than 15 years experience Prior to joining Powerlink, Ray held coordination, organisational development, Australian electricity transmission utility of Ministers, regulatory bodies, customers, reporting. In addition, Maurie is Powerlink’s in the electricity industry, including Chief Technology Officer and Executive and employment systems and services. which Powerlink is a 41 per cent owner, National Electricity Market participants and Company Secretary. management roles in operations, design, Management roles in the utilities, gambling and a member of the SEQ Water Grid the community. Gary manages Powerlink’s continuous and project delivery. and markets sectors. Manager Board. Maurie is a Director of ElectraNet SA, improvement initiatives that ensure we Simon is a Director of ElectraNet SA a member of the ElectraNet SA Audit and Stewart is Vice-Chair of the Asia Pacific have a workplace culture that is right for He was awarded a Centenary Medal for his and Chair of the Australian Power Institute, Compliance Committee and a member of Utilities Group, a network of utilities that our people and for our business. He also contribution to the electricity industry. and a Director of the Australian National the ElectraNet SA Treasury Committee. collaborate on supply chain improvements. coordinates initiatives to ensure Powerlink Committee of International Council on Before joining Powerlink, Gordon held senior has the right people and capabilities Large Electric Systems (CIGRE). management positions with one of Australia’s necessary to deliver our current and largest computer software companies, Simon has more than 35 years future business targets. Mincom. During his 14 years with the experience in electricity generation and Gary has more than 35 years professional company, he spent three years in the United transmission, including roles in Australia experience in clinical and organisational States as President of its North American and overseas in planning, design, and psychology roles, including 22 years in human subsidiary, before being appointed Deputy strategic assets management. resource management. Managing Director of Mincom in 1990.

66 powerlink annual report 2008/09 powerlink annual report 2008/09 67 corporate governance executive leadership team

Terry Miller Garry Mulherin Michelle Palmer Brian Pokarier Merryn York BE(Elec) BE(Elec) BComms, MA, MPRIA BE, DipsBusinessManagement, CPEng, FIEAust BE(Hons), MEngSc, Grad Cert AppLaw

Manager Network Development Manager Network Field Services Manager Corporate Communication Manager Engineering Manager Network Strategy and Performance As Manager Network Development, Terry Garry manages Network Field Services As Manager Corporate Communication, Brian manages the Engineering Business Unit, is responsible for planning Powerlink’s future work for Powerlink’s transmission network in Michelle is responsible for Powerlink’s public which is responsible for the delivery of capital As Manager Network Strategy and network investments and timely acquisition Southern Queensland, with the objectives of relations policy and strategic, corporate works and refurbishment projects, and leading Performance, Merryn’s responsibilities of transmission easements to meet future maximising system reliability and minimising communication, media liaison, government the organisation’s development and including strategic business development development needs. Planning for future outage restoration times at optimal cost. relations, and internal communication. assessment of new technologies to enhance and asset management to maximise the investments includes forecasting future network performance. Within the electricity transmission field, Michelle has provided strategic long-term return on Powerlink’s investments network demand, analysing network Garry has specialised in transmission and communications counsel for more than Brian and his team work to ensure that in a way that meets the expectations of our capabilities into the future, and recommending sub-transmission line design, and construction 10 years within the Queensland electricity Powerlink’s record capital works program stakeholders, including our shareholders, augmentation investment options to ensure and project management. He has also industry, joining Powerlink in 2002 following is delivered successfully through the effective customers, National Electricity Market continued reliable network performance. led quality improvement projects in four years with ENERGEX’ public affairs team. management of a large, highly skilled team participants, the Australian Energy Regulator Terry represented the Queensland environmental processes, engineering based at the Brisbane head office and and the community. jurisdictional planning body on the Inter design, project management and overall construction site offices located throughout With more than 20 years experience in the Regional Planning Committee of the National cost efficiency. Queensland. Brian also oversees Powerlink’s Queensland electricity industry, Merryn’s Electricity Market until 30 June 2009. strategic development of partnerships with More than 30 years experience in the career has included experience in network companies for the design and construction With more than 35 years experience in the electricity industry has provided Garry with planning, regulatory affairs, customer of substations and transmission lines. Queensland electricity industry, Terry’s career a depth of experience in distribution and management, and strategic development has included experience in strategic business transmission networks, including management With more than 30 years experience of the transmission network. development, asset management, network of key business areas and organisational in power system engineering within the planning, regulatory affairs, customer change initiatives. Queensland electricity industry and management, substation design, and overseas, Brian continues to play an active distribution network design. role in the International Council on Large Electric Systems (CIGRE) and Australian Standards committees.

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The Directors present their report (c) Performance of the functions of Significant events subsequent to Greenhouse gas and energy Company secretary together with the financial report of Jurisdictional Co-ordinator of the end of the financial year data reporting requirements Mr Maurice D Brennan was appointed Queensland Electricity Transmission Sensitive Loads in Queensland, and There has not arisen, in the interval The Consolidated Entity is subject to to the position of company secretary in Corporation Limited trading as Transmission Network Planning in between the end of the financial year the reporting requirements of both the July 1995. Full details of Mr Brennan’s Powerlink Queensland (the Company) Queensland, as appointed by the and the date of this report, any item, Energy Efficiency Opportunities Act 2006 qualifications, experience and special and of the Consolidated Entity being Queensland Government transaction or event of a material and and the National Greenhouse and Energy responsibilities are provided in this the Company and its subsidiaries, Reporting Act 2007. (d) Provision of metering services to unusual nature, likely, in the opinion annual report. and the Consolidated Entity’s interest of the Directors of the Company, to measure electricity at generation and The Energy Efficiency Opportunities in associates for the financial year significantly affect the operations of Meetings of Directors usage at connection points to the Act 2006 requires the entities to ended 30 June 2009 and the auditor’s the Consolidated Entity, the results of transmission network. assess their energy usage, including The numbers of meetings of the report thereon. those operations, or the state of affairs the identification, investigation Company’s Board of Directors and There were no significant changes of the Consolidated Entity in future and evaluation of energy saving of each Board Committee held during Directors in the nature of the activities of financial years. opportunities, and to report publicly the year ended 30 June 2009, and the The Directors of the Company the Consolidated Entity during on the assessments undertaken, numbers of meetings attended by each at any time during or since the end the financial year. Likely developments and including what action they intend Director were: of the financial year were: expected results of operations Dividends Information on likely developments in to take as a result. The threshold Else Shepherd The Directors have provided for the operations of the Consolidated energy use for the Energy Efficiency Directors Meetings of committees Opportunities Act 2006 is 0.5 petajoules. Julie Beeby a final dividend of $98.808 million Entity and the expected results of Full meetings In 2007/2008 Powerlink Queensland Audit Remuneration (2008: $84.412 million) being operations have not been included in of Directors John Goddard used 0.4 petajoules and was therefore 80 percent (2008: 80%) of the profit this financial statement because the ABABAB Kenneth Howard identified as being exempt from the after income tax equivalent expense Directors believe it would be likely to Else Shepherd 10 11 ** ** 2 2 excluding the contributions from result in unreasonable prejudice to the Act at this time. Christina Sutherland Julie Beeby 8 9 ** ** ** ** equity accounted associates. Consolidated Entity. The National Greenhouse and Energy Walter Threlfall. John Goddard 10 11 3 4 2 2 The final dividend will not be franked. Reporting Act 2007 requires the Environmental regulation Consolidated Entity to report its annual Kenneth Howard 10 11 4 4 ** ** Principal activities Review of operations The Consolidated Entity is subject greenhouse gas emissions and energy Christina Sutherland 9 11 4 4 ** ** During the year the principal continuing to environmental regulations under A review of the Consolidated Entity’s use. The first measurement period for Walter Threlfall 11 11 ** ** 2 2 activities of the Consolidated Entity State and Commonwealth Government operations during the financial year, this Act ran from 1 July 2008 to 30 June consisted of: legislation with regard to its acquisition 2009. The Consolidated Entity has A = Number of meetings attended and the results of those operations, B = Number of meetings held during the time the Director held and development of transmission (a) Delivery of a transmission service are contained in this annual report. implemented systems and processes of f ice or was a member of the committee during the year ** = Not a member of the relevant committee to electricity market participants line easements, maintenance and for the collection and calculation of via open, non-discriminatory access Significant changes in construction activities, and the operation the data required and will be able to to the Queensland transmission grid the state of affairs of facilities at its Virginia site and prepare and submit its initial report to which connects generating sites There were no significant changes in other sites. the Greenhouse and Energy data Officer with customer/distribution the state of affairs of the Consolidated The Consolidated Entity has an by 31 October 2009. connection points Entity during the financial year. Environmental Steering Committee Information on Directors and Board Audit and Compliance (b) Provision of system operator Details of Directors, their experience, services to assist National Electricity Committee that monitors compliance with environmental regulations. and any special responsibilities are Market Management Company included in this annual report. (or the Australian Energy Market During the period covered by this Operator from 1 July 2009) to report there were no breaches that led Interests in shares and options manage power system security to prosecution, and the Directors are No Director has an interest in the in the Queensland region of the not aware of any material breaches. shares of the Company. National Electricity Market

70 powerlink annual report 2008/09 powerlink annual report 2008/09 71 directors’ report auditor’s independence declaration

Retirement, election and Key management personnel pay Indemnification and Powerlink Queensland indemnifies the Auditor’s independence declaration As lead auditor for the audit of continuation in office of Directors The Remuneration Committee of the insurance of officers Directors and Officers of the Company A copy of the auditor’s independence Queensland Electricity Transmission Dr Julie Beeby’s term as a Director Board of Directors is responsible for During the financial year, Powerlink and its Australian based subsidiaries. declaration as required under section Corporation Limited for the year establishing remuneration policy, and ended 30 June 2009, I declare that, to commenced on 1 October 2008 Queensland insured the Directors and The indemnity relates to any liability: 307C of the Corporations Act 2001 is replacing Mr Merv Norman. for determining and reviewing the employees of the Company and its included with this annual report. the best of my knowledge and belief, remuneration arrangements for key Australian-based controlled entities. (a) to a third party (other than there have been: Remuneration report management personnel. Powerlink Queensland or a related Rounding of amounts The liabilities insured are legal costs that (a) no contraventions of the auditor body corporate) unless the liability The Company is of a kind referred (a) Principles used to determine the may be incurred in defending civil or independence requirements of the (b) Details of remuneration arises out of conduct involving a lack to in Class Order 98/100, issued by nature and amount of remuneration criminal proceedings that may be Corporations Act 2001 in relation Amounts of remuneration of good faith the Australian Securities and Investments Directors brought against the officers in their to the audit Details of the remuneration of the Commission, relating to the “rounding Responsibility for determining and capacity as officers of entities in the (b) for legal costs incurred in successfully key management personnel of the off” of amounts in the Directors’ (b) no contraventions of any applicable reviewing compensation for the Consolidated Entity, and any other defending civil or criminal Consolidated Entity (as defined in report. Amounts in the Directors’ code of professional conduct in Directors resides with the shareholding payments arising from liabilities incurred proceedings or in connection with AASB 124 Related Party Disclosures) report have been rounded off in relation to the audit. Ministers, who as at 30 June 2009 were by the officers in connection with proceedings in which relief is granted are set out in note 27. accordance with that Class Order the Hon. Stephen Robertson, Minister such proceedings. This does not include under the Corporations Act 2001. This declaration is in respect of to the nearest thousand dollars, Powerlink Queensland and the entities for Natural Resources, Mines and Energy The key management personnel of such liabilities that arise from conduct No liability has arisen under these unless otherwise indicated. it controlled during the period. and Minister for Trade, on behalf of the Company includes the Directors involving a wilful breach of duty by indemnities as at the date of this report. the State of Queensland, and the Hon. shown above, and the following the officers or the improper use by This report is made in accordance Andrew Peter Fraser, Treasurer and executive officers who have authority the officers of their position or of Non Audit Services with a resolution of Directors. Minister for Employment and Economic and responsibility for planning, directing information to gain advantage for The company may decide to employ Development on behalf of the State and controlling the activities of themselves or someone else or to the auditor on assignments additional of Queensland. the entity: cause detriment to the company. It is to their statutory audit duties where not possible to apportion the premium the auditor’s expertise and experience Each Director receives an annual fee Chief Executive between amounts relating to the for being a Director of the Company. with the company and/or the Else Shepherd Chief Operating Officer insurance against legal costs and those Carl Harris Consolidated Entity are important. Chairman An additional fee is also paid for each relating to other liabilities. Partner Board Committee on which the Chief Financial Officer Details of the amounts paid or payable Director sits, and for any special The Directors have not included to the auditor (Deloitte Touche Brisbane (as delegate of the Auditor-General Human Resources & meetings of the Board. details of premiums paid in respect Tohmatsu) for audit and non-audit Dated August 2009 of Queensland, Brisbane) Development Manager services provided during the year are of the Directors’ and Officers’ liability August 2009 Directors are not entitled to receive set in Note 28, Remuneration of Loans to Directors and executives and legal insurance contracts as such any performance related remuneration. disclosure is prohibited under the terms Auditors, of the financial statements There are no loans to any Director of the contract. and supporting notes. Directors do not receive share options. or Key Management Personnel of the All shares in the Company are held by Consolidated Entity. the shareholding Ministers on behalf of the State of Queensland.

Directors’ fees The current base remuneration was last reviewed with effect from 1 July 2008. The Chairman’s remuneration is not inclusive of committee fees and other Directors who chair, or are a member of a committee, also receive additional yearly fees.

72 powerlink annual report 2008/09 powerlink annual report 2008/09 73 financial report

Queensland Electricity Transmission Corporation Limited trading as Powerlink Queensland ABN 82 078 849 233 Annual Financial Report – 30 June 2009

This financial report covers both the separate financial statements of Queensland Electricity Transmission Corporation Limited trading as Powerlink Queensland as an individual entity and the consolidated financial statements for the Consolidated Entity consisting of Powerlink Queensland and its subsidiaries. The financial report is presented in the Australian currency. Powerlink Queensland is a company limited by shares, incorporated and domiciled in Australia. Its registered office and principal place of business is: Queensland Electricity Transmission Corporation Limited 33 Harold Street Virginia Qld 4014 A description of the nature of the Consolidated Entity’s operations and its activities is included in the review of operations and principal activities in the Directors’ report, both of which are not part of this financial report. The financial report was authorised for issue by the Directors on 18 August 2009. The company has the power to amend and reissue the financial report.

Woolooga Substation Control Room

powerlink annual report 2008/09 75 Powerlink Queensland Powerlink Queensland income statement balance sheet

FOR THE YEAR ENDED 30 JUNE 2009 as at 30 June 2009

Notes Consolidated Powerlink Queensland Notes Consolidated Powerlink Queensland 2009 2008 2009 2008 2009 2008 2009 2008 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

ASSETS Revenue from continuing operations 4 682,814 611, 635 678,096 607,669 Current assets Less Cash and cash equivalents 7 97,614 100,661 8 4,116 91,541 Expenses from continuing operations excluding finance costs expense 5 (326,878) (313,731) (326,867) (313,713) Trade and other receivables 8 52 ,114 65,741 51,675 65,406 Finance costs 5 (180,281) (146,721) (180,281) (146,721) Inventories 9 31,409 27,513 31,409 27,513 Share of net profits/(losses) of Associates Other current assets 10 7,687 7,487 7,687 7,487 accounted for using the equity method 33(c) (2,073) (3,157) - - Other financial assets 1,628 207 1,628 207 Profit/(loss) from continuing operations Total current assets 190,452 201,609 176,515 192,154 before income tax equivalent expense 173,582 148,026 170,948 147,235 Non-current assets Income tax equivalent benefit/(expense) 6(b) (51,710) (44,893) (48,058) (41,817) Investments accounted for using the equity method 11 38,844 46,720 - - Profit/(Loss) from continuing operations 121,872 103,133 122,890 105,418 Defined benefit superannuation fund asset 15 5,409 13,605 5,409 13,605 Profit/(Loss) for the year 25(b) 121,872 103,133 122,890 105,418 Other financial assets 12 73,467 64,731 75,455 62,955 Profit attributed to members of Queensland Electricity Transmission Corporation Limited 121,872 103,133 122,890 105,418 Property, plant and equipment 13 5,219,870 4,599,079 5,219,870 4,599,079 The above income statement should be read in conjunction with the accompanying notes. Total non-current assets 5,337,590 4,724,135 5,300,734 4,675,639 Total assets 5,528,042 4,925,744 5,477,249 4,867,793

LIABILITIES Current liabilities Trade and other payables 16 100,610 180,975 100,625 180,985 Current tax liabilities 18 8,387 387 8,387 387 Provisions 17 115,754 100,778 115,754 100,778 Other liabilities 19 7,452 14,946 7,452 14,946 Total current liabilities 232,203 297,086 232,218 297,096 Non-current liabilities Interest bearing loans and borrowings 20 3,038,420 2,516,420 3,038,420 2,516,420 Deferred tax liabilities 22 361,964 325,605 334,391 295,774 Provisions 23 21,743 20,107 21,743 20,107 Other liabilities 21 17,427 9,387 17,427 9,387 Total non-current liabilities 3,439,554 2,871,519 3,411,981 2,841,688

Total liabilities 3,671,757 3,168,605 3,644,199 3,138,784

Net assets 1,856,285 1,757,139 1,833,050 1,729,009

EQUITY Contributed equity 24 401,000 401,000 401,000 401,000 Reserves 25(a) 440,048 355,322 408,735 323,067 Retained profits 25(b) 1,015,237 1,000,817 1,023,315 1,004,942 Capital and reserves attributable to equity holders of Queensland Electricity Transmission Corporation Limited 1,856,285 1,757,139 1,833,050 1,729,009 Parent Entity Interest 1,856,285 1,757,139 1,833,050 1,729,009 Total equity 1,856,285 1,757,139 1,833,050 1,729,009

The above balance sheet should be read in conjunction with the accompanying notes.

76 powerlink annual report 2008/09 powerlink annual report 2008/09 77 Powerlink Queensland Powerlink Queensland statement of recognised income and expense statement of cash flows

FOR THE YEAR ENDED 30 JUNE 2009 For the year ended 30 June 2009

Notes Consolidated Powerlink Queensland Notes Consolidated Powerlink Queensland 2009 2008 2009 2008 2009 2008 2009 2008 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Gain on revaluation of property, plant Cash flows from operating activities and equipment, net of tax 25 93,867 135,071 85,999 117, 278 Receipts from customers 649,933 5 45,911 649,933 5 45,911 Changes in the fair value of cash flow hedges, net of tax 25 (9,141) (224) (331) 382 Intra Regional Settlements Residue (IRSR) (62,370) 21,287 (62,370) 21,287 Actuarial gains/(losses) on Defined Benefit Payments to suppliers and employees (145,800) (181,496) (145,786) (181,475) Superannuation Fund, net of tax 15(g),25 (8,644) (13,155) (5,709) (13,343) Interest received 17,393 19,346 3,210 5,778 Change in 2006/07 value of Associates - 72 - - Dividends received 265 246 9,805 9,708 Net income recognised directly in equity 76,082 121,764 79,959 104,317 Finance costs paid (178,150) (146,560) (178,150) (146,560) Profit for the year 121,872 103,133 122,890 105,418 Income tax equivalent paid (42,410) (57,548) (38,393) (49,851) Total recognised income and expense for the year 197,954 224,897 202,849 209,735 Goods and services tax paid (916) (3,356) (916) (3,356)

Total recognised income and expense for the year is attributable to: Other operating receipts 28,183 30,711 28,183 30,711 Equity holders of Queensland Electricity Other operating payments (910) (770) (910) (770) Transmission Corporation Limited 197,954 224,897 202,849 209,735 Net cash inflow (outflow) from operating activities 35 265,218 227,771 264,606 231,383  197,954 224,897 202,849 209,735 Cash flows from investing activities The above statement of recognised income and expense should be read in conjunction with the accompanying notes. Payments for property, plant and equipment (696,762) (638,238) (696,762) (638,238) Proceeds from sale of property, plant and equipment 6,771 1,592 6,771 1,592 Proceeds/(payments) for Investments (15,862) (16,491) (19,628) (13,550) Net cash (outflow) inflow from investing activities (705,853) (653,137) (709,619) (650,196) Cash flows from financing activities Proceeds from borrowings 522,000 509,500 522,000 509,500 Dividends paid to Company’s shareholders 26 (84,412) (92,606) (84,412) (92,606) Net cash (outflow)/inflow from financing activities 437,588 416,894 437,588 416,894 Net increase/(decrease) in cash and cash equivalents held (3,047) (8,472) (7,425) (1,919) Cash and cash equivalents at the beginning of the financial year 100,661 109,133 91,541 93,460 Cash and cash equivalents at end of year 7 97,614 100,661 8 4,116 91,541

The above statement of cash flows should be read in conjunction with the accompanying notes.

78 powerlink annual report 2008/09 powerlink annual report 2008/09 79 Powerlink Queensland Powerlink Queensland notes to the financial statements notes to the financial statements

30 JUNE 2009 30 JUNE 2009

1 Summary of significant (b) Principles of consolidation (ii) Associates 1 Summary of significant Translation differences on assets and (ii) Other revenue accounting policies (i) Subsidiaries Associates are all entities over which the accounting policies (continued) liabilities carried at fair value are reported as Other revenue is earned from the Consolidated Entity has significant influence part of the fair value gain or loss. Translation provision of property searches, customer The principal accounting policies adopted The consolidated financial statements but not control, generally accompanying a (c) Segment reporting differences on non-monetary assets and works, wholesale telecommunications in the preparation of the financial report incorporate the assets and liabilities of all shareholding of between 20% and 50% of A business segment is identified for a liabilities such as equities held at fair value services and various miscellaneous works are set out below. These policies have subsidiaries of Powerlink Queensland the voting rights. Investments in Associates group of assets and operations engaged through profit or loss are recognised in and services. Revenue is recognised when been consistently applied to all the years (“company” or “parent entity”) as at 30 June are accounted for in the holding entity’s in providing products or services that are profit or loss as part of the fair value gain the customer is invoiced. presented, unless otherwise stated. 2009 and the results of all subsidiaries for financial statements using the cost method subject to risks and returns that are different or loss. Translation differences on non- The accounting policies have been the year then ended. Powerlink Queensland and in the consolidated financial statements to those of other business segments. monetary assets such as equities classified as (iii) Interest income applied consistently by all entities in the and its subsidiaries together are referred to using the equity method of accounting, A geographical segment is identified when available-for-sale financial assets are included Interest income is recognised on a time Consolidated Entity. The financial report in this financial report as the Consolidated after initially being recognised at cost. products or services are provided within a in the fair value reserve in equity. proportion basis using the effective interest includes separate financial statements for Entity or the Group. The Consolidated Entity’s investment in particular economic environment subject to method. When a receivable is impaired, the Powerlink Queensland as an individual entity (e) Revenue recognition Subsidiaries are all those entities (including Associates includes goodwill (net of any risks and returns that are different from Consolidated Entity reduces the carrying and the Consolidated Entity consisting of special purpose entities) over which the accumulated impairment loss) identified on those of segments operating in other Revenue is measured at the fair value of amount to its recoverable amount, being the Powerlink Queensland and its subsidiaries. Consolidated Entity has the power to acquisition (refer to Note 33). economic environments. the consideration received or receivable. estimated future cash flow discounted at Amounts disclosed as revenue are net of (a) Basis of preparation govern the financial and operating policies, the original effective interest rate of the generally accompanying a shareholding of The Consolidated Entity’s share of its The Consolidated Entity operates in the one returns, trade allowances, rebates and instrument, and continues unwinding the This general purpose financial report more than one-half of the voting rights. Associates’ post-acquisition profits or losses industry, being the transmission of electricity amounts collected on behalf of third parties. discount as interest income. Interest income has been prepared in accordance with The existence and effect of potential voting is recognised in the Income Statement, and and one geographical segment, Australia, on impaired loans is recognised using the Australian Accounting Standards, other The Consolidated Entity recognises rights that are currently exercisable or its share of post-acquisition movements and is reported accordingly. original effective interest rate. authoritative pronouncements of the revenue when the amount of revenue can convertible are considered when assessing in reserves is recognised in reserves. Australian Accounting Standards Board, (d) Foreign currency translation be reliably measured, it is probable that whether the Consolidated Entity controls The cumulative post-acquisition movements (iv) Dividends Interpretations and the Corporations are adjusted against the carrying amount of (i) Functional and presentation currency future economic benefits will flow to the Dividends are recognised as revenue when another entity. entity and specific criteria have been met for Act 2001. the investment. Dividends receivable from Items included in the financial statements the right to receive payment is established. each of the Consolidated Entity’s activities as Subsidiaries are fully consolidated from Associates are recognised in the holding of each of the Consolidated Entity’s entities Early adoption of standards described below. The amount of revenue is the date on which control is transferred entity’s Income Statement, while in are measured using the currency of the (f) Income tax equivalents not considered to be reliably measurable The Consolidated Entity has elected not to to the Consolidated Entity. They are the consolidated financial statements primary economic environment in which the The Consolidated Entity is required to until all contingencies relating to the sale early adopt any of the accounting standards. de-consolidated from the date that they reduce the carrying amount of entity operates (‘the functional currency’). make income tax equivalent payments to have been resolved. The Consolidated control ceases. the investment. The consolidated financial statements are the State Government based on the benefits Historical cost convention Entity bases its estimates on historical presented in Australian dollars, which is derived because it is not liable to pay This financial report has been prepared on The purchase method of accounting is used When the Consolidated Entity’s share of results, taking into consideration the type Powerlink Queensland’s functional and Commonwealth tax that would be the basis of historical costs, except for the: to account for the acquisition of subsidiaries losses in an Associate equals or exceeds its of customer, the type of transaction and presentation currency. payable if it were not a Government by the Consolidated Entity. The purchase interest in the Associate, including any other the specifics of each arrangement. revaluation at fair value, through the Owned Corporation. method of accounting involves allocating the unsecured long-term receivables, the (ii) Transactions and balances Income Statement, of financial assets cost of the business combination to the fair Consolidated Entity does not recognise Revenue is recognised for the major business Foreign currency transactions are translated These payments are made pursuant to and liabilities (including derivative value of the assets acquired and the liabilities further losses, unless it has incurred activities as follows: into the functional currency using the section 155(4) of the Government Owned instruments) and contingent liabilities assumed at the date obligations or made payments on behalf exchange rates prevailing at the dates of the (i) Grid sales revenue Corporations Act 1993 and are based on of acquisition. of the Associate. rulings set out in the National Tax revaluation of certain classes of transactions. Foreign exchange gains and Grid sales revenue comprises revenue Equivalent’s manual. The National Tax property, plant and equipment. Intercompany transactions, balances and Unrealised gains on transactions between losses resulting from the settlement of such earned from the provision of regulated and Equivalent manual gives rise to obligations unrealised gains on transactions between the Consolidated Entity and its Associates transactions and from the translation at year non-regulated transmission grid services. Critical accounting estimates which reflect in all material respects those Consolidated Entity companies are are eliminated to the extent of the end exchange rates of monetary assets and Sales revenue is recognised when the The preparation of financial statements in obligations for taxation which would be eliminated on consolidation. Unrealised Consolidated Entity’s interest in the liabilities denominated in foreign currencies services are provided. conformity with AIFRS requires the use of imposed by the Income Tax Assessment Act losses are also eliminated unless the Associates. Unrealised losses are also are recognised in the Income Statement, certain critical accounting estimates. It also Regulated grid sales revenue is subject to 1936 and 1997 - (Note 6). transaction provides evidence of the eliminated unless the transaction provides except when they are deferred in equity requires management to exercise its the application of an annual revenue cap impairment of the asset transferred. evidence of an impairment of the asset as qualifying cash flow hedges and qualifying Income tax equivalent judgement in the process of applying the determined for the Company. Transmission Accounting policies of subsidiaries have transferred. Accounting policies of net investment hedges or are attributable Consolidated Entity’s accounting policies. Use of System (TUOS) prices are initially set Current tax assets and liabilities for the been changed where necessary to ensure Associates have been changed where to part of the net investment in a The areas involving a higher degree of to achieve the annual revenue cap. current and prior period are measured at consistency with the policies adopted by necessary to ensure consistency with the foreign operation. judgement or complexity, or areas where the amount expected to be recovered from the Consolidated Entity. policies adopted by the Consolidated Entity. While the regulated revenue collected in a assumptions and estimates are significant to or paid to the taxation authorities based on period may vary from the annual revenue the financial statements, are disclosed Investments in subsidiaries are accounted for the current period’s taxable income. The tax cap, the annual revenue cap is brought to in Note 3. at cost in the individual financial statements rates and tax laws used to compute the of Powerlink Queensland. account as revenue on the basis that the amount are those that are enacted or Company is able to recover, or is required substantively enacted by the balance to return, amounts that have been under or sheet date. over collected in the current period. Amounts over collected are recognised as unearned revenue and any shortfalls are recognised as revenue in the year.

80 powerlink annual report 2008/09 powerlink annual report 2008/09 81 Powerlink Queensland Powerlink Queensland notes to the financial statements notes to the financial statements

30 JUNE 2009 30 JUNE 2009

1 Summary of significant The carrying amount of deferred income tax Assets or liabilities arising under tax funding 1 Summary of significant Recoverable amount is the higher of fair Collectibility of trade receivables is reviewed accounting policies (continued) equivalent assets is reviewed at each balance agreements with the tax consolidated accounting policies (continued) value less costs to sell and value in use. In on an ongoing basis. Debts which are known sheet date and reduced to the extent that it entities are recognised as amounts assessing value in use, the estimated future to be uncollectible are written off by Deferred income tax equivalent is provided is no longer probable that sufficient taxable receivable from or payable to other entities Cross Border Lease cash flows are discounted to their present reducing the carrying amount directly. on all temporary differences at the balance profit will be available to allow all or part of in the Consolidated Entity - (Note 6). Powerlink Queensland has entered into a value using a discount rate that reflects A provision for impairment of trade sheet date between the tax bases of assets the deferred income tax equivalent asset to structured financing arrangement involving current market assessments of the time receivables is used when there is objective Any difference between the amounts and liabilities and their carrying amounts for be utilised. the sale and subsequent lease back of supply value of money and the risks specific to the evidence that the Consolidated Entity will assumed and amounts receivable or payable financial reporting purposes. system assets. This arrangement was asset for which the future cash flows have not be able to collect all amounts due Unrecognised deferred income tax under the tax funding agreement are entered into in conjunction with Queensland not been adjusted. If the recoverable according to the original terms of the Deferred income tax equivalent liabilities equivalent assets are reassessed at each recognised as a contribution to or Treasury Corporation (QTC), and was a amount of an asset or cash generating unit receivables. Significant financial difficulties of are recognised for all taxable temporary balance sheet date and are recognised to distribution from wholly-owned tax United States of America cross border lease is estimated to be materially less than its the debtor, probability that the debtor will differences except: the extent that it has become probable that consolidated entities. transaction over Powerlink Queensland’s carrying amount, the carrying amount of the enter bankruptcy or financial reorganisation, future taxable profit will allow the deferred when the deferred income tax Contributions to fund the current regulated transmission assets. asset or cash generating unit is reduced to and default or delinquency in payments tax equivalent asset to be recovered. equivalent liability arises from the initial tax liabilities are payable as per the tax its recoverable amount. An impairment loss (more than 30 days overdue) are considered The cross border lease involved a series of recognition of goodwill or of an asset Deferred income tax equivalent assets and funding agreement, and reflect the timing is recognised immediately in the Income indicators that the trade receivable may be hire purchase and lease transactions. or liability in a transaction that is not a liabilities are measured at the tax rates that of the head entity’s obligation to make Statement, unless the relevant asset is impaired. The amount of the impairment business combination, and that, at the are expected to apply to the year when the payments for tax liabilities to the relevant The transaction comprised four (4) carried at a revalued amount, in which allowance is the difference between the time of a transaction, affects neither the asset is realised or the liability is settled, tax authorities. tranches and was completed in January case the impairment loss is treated as a asset’s carrying amount and the present accounting profit nor taxable profit or based on tax rates (and tax laws) that have 2001. The date of expiry of the lease revaluation decrease. value of estimated future cash flows, loss; or been enacted or substantively enacted at (g) Leases discounted at the original effective interest agreement is 2 January 2027. Where an impairment loss subsequently the balance sheet date. Leases of property, plant and equipment rate. Cash flows relating to short-term reverses, the carrying amount of the asset when the taxable temporary difference where the Consolidated Entity, as lessee, has (h) Impairment of assets receivables are not discounted if the effect Deferred income tax equivalent assets and (cash generating unit) is increased to the is associated with investments in substantially all the risks and rewards of At each reporting date, the Consolidated of discounting is immaterial. deferred income tax equivalent liabilities are revised estimate of its recoverable amount, subsidiaries, Associates or interests in ownership are classified as finance leases Entity reviews the carrying amounts of its offset only if a legally enforceable right exists but only to the extent that the increased The amount of the impairment loss is joint ventures, and the timing of the (Note 13). Finance leases are capitalised at assets to determine whether there is any to set off current income tax equivalent carrying amount does not exceed the recognised in the Income Statement within reversal of the temporary difference can the lease’s inception at the fair value of the indication that those assets have suffered an assets against current income tax equivalent carrying amount that would have been ‘other expenses’. When a trade receivable be controlled and it is probable that the leased property or, if lower, the present impairment loss. If any such indication exists, liabilities and the deferred income tax determined had no impairment loss been for which an impairment allowance had temporary difference will not reverse in value of the minimum lease payments. the recoverable amount of the asset is equivalent assets and liabilities relate to recognised for the asset (cash generating been recognised becomes uncollectible in the foreseeable future. The corresponding rental obligations, net estimated in order to determine the extent the same taxable entity and the same unit) in prior years. A reversal of an a subsequent period, it is written off against of finance charges, are included in other of the impairment loss (if any). Where the Deferred income tax equivalent assets are taxation authority. impairment loss is recognised immediately the allowance account. Subsequent short-term and long-term payables. Each asset does not generate cash flows that recognised for all deductible temporary in the Income Statement unless the relevant recoveries of amounts previously written lease payment is allocated between the are independent from other assets, the differences, carry forward of unused tax Current and deferred tax equivalent asset is carried at fair value, in which case off are credited against other expenses in liability and finance cost. The finance cost is Consolidated Entity estimates the credits and unused tax losses, to the extent balances attributable to amounts recognised the reversal of the impairment loss is treated the Income Statement. charged to the Income Statement over the recoverable amount of the cash generating that it is probable that taxable profit will be directly in equity are also recognised directly as a revaluation increase. available against which the deductible in equity. lease period so as to produce a constant unit to which the asset belongs. Where a The carrying amount of the asset is temporary differences and the carry periodic rate of interest on the remaining reasonable and consistent basis of allocation (i) Cash and cash equivalents reduced through the use of an allowance Tax consolidation legislation balance of the liability for each period. forward of unused tax credits and unused can be identified, corporate assets are also Cash and cash equivalents includes cash account and the amount of the loss is Powerlink Queensland and its The property, plant and equipment acquired tax losses can be utilised, except: allocated to individual cash generating units, on hand, deposits held at call with financial recognised in the Income Statement within wholly-owned Australian controlled under finance leases is depreciated over or otherwise they are allocated to the institutions, other short-term, highly liquid ‘other expenses’. When a trade receivable when the deferred income tax entities have implemented the tax the shorter of the asset’s useful life and the smallest group of cash generating units for investments with original maturities of three is uncollectible, it is written off against the equivalent asset relating to the consolidation legislation with effect from lease term. which a reasonable and consistent allocation months or less that are readily convertible allowance account for trade receivables. deductible temporary difference arises 1 July 2003. Powerlink Queensland is the basis can be identified. Subsequent recoveries of amounts Operating leases are classified as leases in to known amounts of cash and which are from the initial recognition of an asset head entity of the tax consolidated group. subject to an insignificant risk of changes previously written off are credited against or liability in a transaction that is not a which a significant portion of the risks and Intangible assets with indefinite useful lives in value, and bank overdrafts. other expenses in the Income Statement. business combination and, at the time The head entity, Powerlink Queensland rewards of ownership are not transferred to and intangible assets not yet available for and the controlled entities in the tax the Consolidated Entity as lessee (Note 30). of the transaction, affects neither the use are tested for impairment annually and Bank overdrafts are shown within (k) Inventories consolidated group account for their own Payments made under operating leases accounting profit nor taxable profit whenever there is an indication that the borrowings in current liabilities in the Inventories shown as current assets are not current and deferred tax amounts. These (net of any incentives received from the or loss; or asset may be impaired. balance sheet. for resale but are used in maintenance and tax amounts are measured as if each entity lessor) are charged to the Income Statement construction, and are valued at the lower of when the deductible temporary in the tax consolidated group continues to on a straight-line basis over the period of (j) Trade and other receivables average cost and net realisable value. difference is associated with investments be a stand alone taxpayer in its own right. the lease. Trade and Other Receivables are recognised in subsidiaries, Associates or interests in In addition to its own current and deferred Lease income from operating leases initially at fair value and subsequently joint ventures, in which case a deferred tax amounts, Powerlink Queensland also where the Consolidated Entity is a lessor measured at amortised cost using the tax equivalent asset is only recognised to recognises the current tax liabilities or assets is recognised as income on a straight-line effective interest method, less provision for the extent that it is probable that the and the deferred tax assets arising from basis over the lease term. impairment. Trade receivables are generally temporary difference will reverse in the unused tax losses and unused tax credits due for settlement within 30 days. foreseeable future and the taxable profit assumed from controlled entities in the tax will be available against which the consolidated group. temporary difference can be utilised.

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1 Summary of significant (i) Fair value hedge When a hedging instrument expires or is 1 Summary of significant Freehold Land and Buildings and Easements Revaluation accounting policies (continued) Changes in the fair value of derivatives sold or terminated, or when a hedge no accounting policies (continued) Freehold land and buildings and easements An asset’s carrying amount is written down that are designated and qualify as fair longer meets the criteria for hedge are measured at fair value using the income immediately to its recoverable amount if the (l) Derivatives and hedging activities value hedges are recorded in the Income accounting, any cumulative gain or loss The fair value of financial instruments that based approach based on expected future assets carrying amount is greater than its Derivatives are initially recognised at fair Statement, together with any changes in the existing in equity at that time remains in are not traded in an active market (for cash flows. Accumulated depreciation at the estimated recoverable amount. value on the date a derivative contract fair value of the hedged asset or liability that equity and is recognised when the forecast example, over-the-counter derivatives) date of revaluation together with the gross Within the other land and buildings is entered into and are subsequently are attributable to the hedged risk. The gain transaction is ultimately recognised in the is determined using valuation techniques. carrying amount of the assets are restated category, the fair value of easements is remeasured to their fair value at each or loss relating to the effective portion of Income Statement. When a forecast The Consolidated Entity uses a variety of to the revalued amount of the asset. based on historic purchase cost increased reporting date. The accounting for interest rate swaps hedging fixed rate transaction is no longer expected to methods and makes assumptions that are Revaluations are made with sufficient by relevant Australian Bureau of Statistics subsequent changes in fair value depends borrowings is recognised in the Income occur, the cumulative gain or loss that based on market conditions existing at regularity to ensure that the carrying indices at the end of each financial year. on whether the derivative is designated Statement within finance costs, together was reported in equity is immediately each balance date. Quoted market prices amount of the freehold land and buildings as a hedging instrument, and if so, with changes in the fair value of the hedged transferred to the Income Statement. or dealer quotes for similar instruments and easements does not differ materially On 1 July 2004, the date of transition to the nature of the item being hedged. fixed rate borrowings attributable to are used for long-term debt instruments from fair value at the reporting date. (iii) Derivatives that do not AIFRS, certain items of property, plant The Consolidated Entity designates held. Other techniques, such as estimated interest rate risk. The gain or loss relating qualify for hedge accounting The application of this policy to existing and equipment that had been revalued certain derivatives as either: to the ineffective portion is recognised in discounted cash flows, are used to assets is reviewed by the Directors at each to fair value, on or prior to that date, Certain derivative instruments do not the Income Statement within other income determine fair value for the remaining reporting date. were measured at deemed cost, being hedges of the fair value of recognised qualify for hedge accounting. Changes in the or other expenses. financial instruments. The fair value of the revalued amount at that date of assets or liabilities or a firm commitment fair value of any derivative instrument that Other Property, Plant and Equipment interest rate swaps is calculated as the that revaluation. (fair value hedges); or If the hedge no longer meets the criteria does not qualify for hedge accounting are present value of the estimated future cash All other property, plant and equipment is for hedge accounting, the adjustment to the recognised immediately in the Income flows. The fair value of forward exchange Additions to property, plant and hedges of the cash flows of recognised valued at historical cost less depreciation. carrying amount of a hedged item for which Statement and are included in other contracts is determined using forward equipment during the year, except for assets and liabilities and highly probable the effective interest method is used is income or other expenses. exchange market rates at the balance Acquisition of Assets newly commissioned supply system assets, forecast transactions (cash flow hedges). amortised to profit or loss over the period sheet date. The cost method of accounting is used for all are not subject to revaluation using price (iv) Forward Starting Loans The Consolidated Entity documents at the to maturity using a recalculated effective acquisitions of assets. Cost is determined as indices in the year of acquisition. The carrying value less impairment inception of the hedging transaction the interest rate. The Consolidated Entity enters into the fair value of consideration given plus provision of trade receivables and payables The valuation of the asset category relationship between hedging instruments Forward Starting Loans whereby it costs incidental to the acquisition. (ii) Cash flow hedge are assumed to approximate their fair values other property, plant and equipment and hedged items, as well as its risk agrees to borrow specified amounts in due to their short-term nature. The fair The carrying amount of property, plant and (refer Note 13) does not take into account management objective and strategy for The effective portion of changes in the the future at a predetermined interest rate. value of financial liabilities for disclosure equipment constructed by the Consolidated price index movements. undertaking various hedge transactions. fair value of derivatives that are designated The Forward Starting Loans are entered purposes is estimated by discounting the Entity includes the cost of materials and The Consolidated Entity also documents its and qualify as cash flow hedges is recognised into with the objective of managing against Revaluation increments, net of tax, are future contractual cash flows at the current direct labour and any other costs directly assessment, both at hedge inception and on in equity in the hedging reserve. The gain rising interest rates. recognised in the asset revaluation reserve, market interest rate that is available to attributable to bringing the asset to a an ongoing basis, of whether the derivatives or loss relating to the ineffective portion except for amounts reversing a decrement It is the Consolidated Entity’s policy the Consolidated Entity for similar working condition for its intended use. Cost that are used in hedging transactions have is recognised immediately in the Income previously recognised as an expense. to recognise Forward Starting Loans financial instruments. may also include transfers from equity of any been, and will continue to be, highly effective Statement within other income or Revaluation decrements are only offset at historical cost. Net receipts and gain or loss on qualifying cash flow hedges of in offsetting changes in fair values or cash other expenses. against revaluation increments applying to payments are recognised as an adjustment (n) Property, plant and equipment foreign currency purchases of property, flows of hedged items. the particular asset, and any excess is Amounts accumulated in equity are recycled to interest expense. Supply System Assets plant and equipment. Purchased software in the Income Statement in the periods recognised as an expense. The fair values of various derivative financial Supply system assets are measured at that is integral to the functionality of the when the hedged item affects profit or loss (m) Fair value estimation instruments used for hedging purposes are fair value using the income based approach related equipment is capitalised as part of Depreciation (for instance when the forecast sale that is The fair value of financial assets and disclosed in movements in the hedging based on expected future cash flows. that equipment. hedged takes place). When the forecast financial liabilities must be estimated for Land and easements are not depreciated. reserve in shareholders’ equity. Movements Accumulated depreciation at the date of transaction that is hedged results in the recognition and measurement or for Subsequent Costs Depreciation on other assets is calculated in the hedging reserve in shareholders’ revaluation together with the gross carrying recognition of a non-financial asset (for disclosure purposes. using the straight line method to allocate equity are shown in Note 25. The full fair amount of the assets are restated to the Subsequent costs are included in the example, inventory or fixed assets) the gains their cost or revalued amounts, net of their value of a hedging derivative is classified as The fair value of financial instruments revalued amount of the asset. Revaluations asset’s carrying amount or recognised as a and losses previously deferred in equity are residual values, over their estimated useful a non-current asset or liability when the traded in active markets (such as publicly are made with sufficient regularity to ensure separate asset, as appropriate, only when it transferred from equity and included in the lives, as follows: remaining maturity of the hedged item is traded derivatives, and trading and that the carrying amount of the supply is probable that future economic benefits initial measurement of the cost of the asset. more than 12 months; it is classified as a available-for-sale securities) is based on system assets does not differ materially associated with the item will flow to the The deferred amounts are ultimately Supply system assets 12-50 years current asset or liability when the remaining quoted market prices at the balance sheet from fair value at the reporting date. Consolidated Entity and the cost of the item recognised in the Income Statement or Buildings 7-40 years maturity of the hedged item is less than date. The quoted market price used for The application of this policy to existing can be measured reliably. The carrying as depreciation in the case of fixed assets. 12 months. Trading derivatives are classified financial assets held by the Consolidated assets is reviewed by the Directors at amount of any component accounted for Other property, plant 2-10 years as a separate asset is derecognised when as a current asset or liability. Entity is the current bid price. each reporting date. and equipment replaced. All other repairs and maintenance

are charged to the Income Statement Depreciation commences from the time during the reporting period in which they units of property, plant and equipment are are incurred. brought into commercial operation, and is calculated on all assets with the exception of land and easements.

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1 Summary of significant Principal repayments have been deferred Liability for annual leave expected to be 1 Summary of significant (v) Dividends Pursuant to the Rules, the IRSR balance is accounting policies (continued) in line with the Company’s borrowing settled beyond 12 months of the reporting accounting policies (continued) Provision is made for the amount of held by Powerlink Queensland and is applied program. Interest expense is accrued over date is calculated based on the present value any dividend declared, being appropriately to offset transmission network charges. The assets’ residual values and useful lives the period it becomes due and is recorded of expected future payments when the Expected future payments are discounted authorised and no longer at the discretion In 2008/09 the amount of IRSR applied to are reviewed, and adjusted if appropriate, at as part of trade and other payables. liability is settled, including related on-costs. using market yields at the reporting date on of the entity, on or before the end of offset regulated network charges totalled each reporting date. national government bonds with terms to the financial year but not distributed at $104.8 million (2007/08: $74.4 million). (q) Borrowing costs (ii) Long service leave maturity and currency that match, as balance date. Derecognition and Disposal of Assets Borrowing costs include interest and The liability for long service leave is closely as possible, the estimated future Full details of movements in the IRSR An item of property, plant and equipment costs incurred in connection with the recognised in the provision for long service cash outflows. Recommendation on the dividend to be balance are presented in Note 37. is derecognised upon disposal or when no arrangement of borrowings. Borrowings leave and measured as the present value of paid is determined after consultation with At 30 June 2009, the IRSR balance including Actuarial gains and losses arising from further future economic benefits are costs are expensed as incurred. expected future payments to be made in the shareholding Ministers in accordance interest earned and net of fees was expected from its use or disposal. respect of services provided by employees experience adjustments and changes in with the GOC Act 1993. No distributions $18.6 million (2008: $81.0 million). (r) Provisions up to the reporting date. Consideration is actuarial assumptions are recognised in the are franked. Any gain or loss arising from derecognition (z) New accounting Provisions are recognised when the given to expected future wage and salary period in which they occur, outside profit or of the asset, (calculated as the difference standards and interpretations Consolidated Entity has a present legal or levels, experience of employee departures loss directly in the Statement of Recognised (w) Goods and Services Tax (GST) between the net disposal proceeds and the Certain new accounting standards and constructive obligation as a result of past and periods of service. Expected future Income and Expense. Revenues, expenses and assets are carrying amount of the asset) is included in interpretations have been published that are events, it is probable that an outflow of payments are discounted using market Past service costs are recognised recognised net of the amount of associated the Income Statement in the year in which not mandatory for 30 June 2009 reporting resources will be required to settle the yields at the reporting date on national immediately in income, unless the changes GST, unless the GST incurred is not the asset is derecognised. periods. The Consolidated Entity’s and the obligation and the amount has been reliably government bonds with terms to maturity to the superannuation fund are conditional recoverable from the taxation authority. parent entity’s assessment of the impact of (o) Trade and other payables estimated. Provisions are not recognised for and currency that match, as closely as on the employees remaining in service for In this case it is recognised as part of the these new standards and interpretations is future operating losses. possible, the estimated future cash outflows. a specified period of time (the vesting cost of acquisition of the asset or as part These amounts represent liabilities for goods set out below. period). In this case, the past service costs of the expense. and services provided to the Consolidated Provisions are measured at the present (iii) Superannuation benefit obligations Entity prior to the end of financial year are amortised on a straight-line basis over Receivables and payables are stated inclusive (i) AASB-I 13 Customer Loyalty value of management’s best estimate of All employees of the Consolidated Entity are which are unpaid. The amounts are the vesting period. of the amount of GST receivable or payable. Programmes and AASB 2007-3 the expenditure required to settle the entitled to benefits from the Consolidated unsecured and are usually paid within The net amount of GST recoverable from, (effective from 1 January 2009) present obligation at the reporting date. Entity’s superannuation plan on retirement, Contributions to the defined contribution 30 days of recognition. or payable to, the taxation authority is AASB-I 13 provides guidance on the The discount rate used to determine the disability or death. The Consolidated Entity fund are recognised as an expense as they included with other receivables or payables accounting for customer loyalty programmes present value reflects current market has a defined benefit section and a defined become payable. Prepaid contributions are (p) Borrowings in the Balance Sheet. and requires that the fair value of the assessments of the time value of money contribution section within its plan. The recognised as an asset to the extent that a Borrowings are initially recognised at fair consideration received/receivable in respect and the risks specific to the liability. defined benefit section provides defined cash refund or a reduction in the future value, net of transaction costs incurred. Cash flows are presented on a gross basis. of a sale transaction is allocated between lump sum benefits based on years of service payments is available. Borrowings are subsequently measured at (s) Other liabilities The GST components of cash flows arising the award credits and the other and final average salary. The defined from investing or financing activities which amortised cost. Any difference between the Other liabilities include amounts for (iv) At-risk performance remuneration components of the sale. The Consolidated contribution section receives fixed are recoverable from, or payable to the proceeds (net of transaction costs) and the unearned revenues, which represent Entity does not operate any customer contributions from Consolidated Entity All employees of the Consolidated Entity taxation authority, are presented as redemption amount is recognised in the moneys received by the Consolidated Entity loyalty programmes. AASB-I 13 will companies and the Consolidated Entity’s are eligible for performance payments operating cash flows. Income Statement over the period of the for which the Consolidated Entity has not therefore have no impact on the legal or constructive obligation is limited to based on individual and/or small team borrowings using the effective interest provided the corresponding goods and Consolidated Entity’s financial statements. these contributions. performance during the year. In addition, (x) Rounding of amounts method. Fees paid on the establishment of services (refer Notes 19 and 21). The Consolidated Entity will apply award employees are eligible for a The company is of a kind referred to in loan facilities, which are not an incremental A liability or asset in respect of the defined gainsharing payment based on corporate AASB-I 13 from 1 July 2009. (t) Employee benefits Class Order 98/100, issued by the Australian cost relating to the actual draw-down of the benefit superannuation plan is recognised results (refer Note 15). Securities and Investments Commission, facility, are recognised as prepayments and (i) Wages and salaries, annual in the balance sheet, and is measured as relating to the “rounding off” of amounts in amortised on a straight-line basis over the leave and “Time-off- in-Lieu” leave the present value of the defined benefit (v) Termination benefits on redundancy the financial report. Amounts in the financial term of the facility. obligation at the reporting date less the fair All employees are entitled to a severance Liabilities for wages and salaries, including report have been rounded off in accordance value of the superannuation fund’s assets at payment on redundancy. This severance Borrowings are removed from the balance non-monetary benefits, annual leave and with that Class Order to the nearest that date and any unrecognised past service payment is based on years of service and is sheet when the obligation specified in the “time-off-in-lieu” leave expected to be thousand dollars, or in certain cases, the cost. The present value of the defined capped at seventy-five (75) weeks of salary. contract is discharged, cancelled or expired. settled within 12 months of the reporting nearest dollar. date are recognised in respect of employees’ benefit obligation is based on expected The difference between the carrying (u) Contributed equity amount of a financial liability that has been services up to the reporting date and are future payments which arise from (y) Electricity market operations membership of the fund to the reporting Ordinary shares are classified as equity extinguished or transferred to another party measured at the amounts expected to be National Electricity Market paid when the liabilities are settled including date, calculated annually by independent -(Note 24). and the consideration paid, including any Under the National Electricity Rules related on-costs. actuaries using the projected unit credit non-cash assets transferred or liabilities Incremental costs directly attributable to the (the Rules), the National Electricity Market assumed, is recognised in other income or method. Consideration is given to expected issue of new shares or options are shown in Expenses for non-accumulating sick leave future wage and salary levels, experience of Management Company (NEMMCO) or finance costs. are recognised when the leave is taken and equity as a deduction, net of tax, from the from 1 July 2009, the Australian Energy employee departures and periods of service. proceeds. Incremental costs directly Borrowings are classified as current liabilities measured at the rates paid or payable. Market Operator (AEMO) processes all attributable to the issue of new shares or unless the Consolidated Entity has an electricity market settlement transactions options for the acquisition of a business are unconditional right to defer settlement of for Queensland and transfers the residual not included in the cost of the acquisition as the liability for at least 12 months after the (Inter and Intra Regional Settlements part of the purchase consideration. reporting date. Residue - IRSR) to Powerlink Queensland as the appropriate Transmission Network Service Provider (TNSP).

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1 Summary of significant (iv) Revised AASB 101 Presentation of Financial (vi) Revised AASB 3 Business Combinations, 1 Summary of significant (xi) AASB Interpretation 17 Distribution of accounting policies (continued) Statements and AASB 2007-8 Amendments to AASB 127 Consolidated and Separate Financial accounting policies (continued) Non-cash Assets to Owners and AASB 2008-13 Australian Accounting Standards arising from Statements and AASB 2008-3 Amendments to Amendments to Australian Accounting (ii) AASB 8 Operating Segments and AASB AASB 101 (effective from 1 January 2009) Australian Accounting Standards arising from The Consolidated Entity intends to apply the Standards arising from AASB Interpretation 2007-3 Amendments to Australian Accounting A revised AASB 101 was issued in AASB 3 and AASB 127 (effective 1 July 2009) amendments prospectively to all partial 17 (effective 1 July 2009) Standards arising from AASB 8 (effective from September 2007 and is applicable for The revised AASB 3 continues to apply disposals of subsidiaries from 1 July 2009. AASB-I 17 applies to situations where 1 January 2009) annual reporting periods beginning on the acquisition method to business an entity pays dividends by distributing (ix) AASB 2008-7 Amendments to Australian AASB 8 and AASB 2007-3 are effective or after 1 January 2009. It requires combinations, but with some significant non-cash assets to its shareholders. Accounting Standards - Cost of an Investment for annual reporting periods commencing changes. For example, all payments to These distributions will need to be the presentation of a statement of in a Subsidiary, Jointly Controlled Entity or on or after 1 January 2009. AASB 8 will comprehensive income and makes changes purchase a business are to be recorded Associate (effective 1 July 2009) measured at fair value and the entity will result in a significant change in the approach to the statement of changes in equity, but at fair value at the acquisition date, with need to recognise the difference between In July 2008, the AASB approved to segment reporting, as it requires adoption will not affect any of the amounts recognised contingent payments classified as debt the fair value and the carrying amount of the amendments to AASB 1 First-time Adoption of a ‘management approach’ to reporting on in the financial statements. If an entity has subsequently remeasured through the distributed assets in the income statement of International Financial Reporting Standards the financial performance. The information made a prior period adjustment or has income statement. There is a choice on an on distribution. This is different to the and AASB 127 Consolidated and Separate being reported will be based on what the reclassified items in the financial statements, acquisition-by-acquisition basis to measure Consolidated Entity’s current policy Financial Statements. The Consolidated key decision-makers use internally for it will need to disclose a third balance sheet the non-controlling interest in the acquiree which is to measure distributions of Entity intends to apply the revised rules evaluating segment performance and (statement of financial position), this one either at fair value or at the non-controlling non-cash assets at their carrying amounts. prospectively from 1 July 2009. After that deciding how to allocate resources to being as at the beginning of the comparative interest’s proportionate share of the The interpretation further clarifies date, all dividends received from investments operating segments. The Consolidated period. The Consolidated Entity intends to acquiree’s net assets. All acquisition-related when a liability for the dividend must in subsidiaries, jointly controlled entities or Entity intends to adopt AASB 8 from 1 July apply the revised standard from 1 July 2009. costs must be expensed. be recognised and that it is also measured Associates will be recognised as revenue, 2009. Application of AASB 8 should not at fair value. The Consolidated Entity The revised AASB 127 requires even if they are paid out of pre-acquisition result in different segments, segment results (v) AASB 2008-1 Amendments to Australian intends to apply the interpretation the effects of all transactions with profits, but the investments may need to and different type of information being Accounting Standard - Share-based Payments: prospectively from 1 July 2009. reported in the segment note of the financial Vesting Conditions and Cancellations non-controlling interests to be recorded be tested for impairment as a result of report. At this stage, it is not expected to (effective from 1 January 2009) in equity if there is no change in control the dividend payment. Under the entity’s affect any of the amounts recognised in the AASB 2008-1 clarifies that vesting and these transactions will no longer result current policy, these dividends are financial statements. conditions are service conditions and in goodwill or gains and losses. deducted from the cost of the investment. Furthermore, when a new intermediate performance conditions only and that other The Consolidated Entity intends to apply (iii) Revised AASB 123 Borrowing Costs parent entity is created in internal features of a share-based payment are not the revised standards prospectively to all and AASB 2007-6 Amendments to Australian reorganisations it will measure its investment vesting conditions. It also specifies that all business combinations and transactions with Accounting Standards arising from AASB 123 in subsidiaries at the carrying amounts of the cancellations, whether by the entity or by non-controlling interests from 1 July 2009. (effective from 1 January 2009) other parties, should receive the same net assets of the subsidiary rather than the The revised AASB 123 is applicable to accounting treatment. The Consolidated (vii) AASB 2008-5 Amendments to subsidiary’s fair value. annual reporting periods commencing on Entity will apply the revised standard from Australian Accounting Standards arising (x) AASB 2008-8 Amendment to IAS 39 or after 1 January 2009. It has removed 1 July 2009, but it is not expected to have from the Annual Improvements Project Amendment to Australian Accounting Standards the option to expense all borrowing costs (effective from 1 January 2009) any affect as the Consolidated Entity does - Eligible Hedged Items (effective 1 July 2009) and - when adopted - will require the not have, or is currently planning, any In July 2008, the AASB issued a number AASB 2008-8 amends AASB 139 Financial capitalisation of all borrowing costs directly share-based payments. of improvements to existing Australian Instruments: Recognition and Measurement attributable to the acquisition, construction Accounting Standards. The Consolidated and must be applied retrospectively in or production of a qualifying asset. The Entity intends to apply the revised standards accordance with AASB 108 Accounting Consolidated Entity intends to adopt AASB from 1 January 2009. On initial application, Policies, Changes in Accounting Estimates 123 from 1 July 2009. The Consolidated the entity will need to make adjustments to and Errors. The amendment makes two Entity does not currently capitalise disclosures for each of the amendments. borrowing costs relating to qualifying assets. significant changes. It prohibits designating The extent of the impact, once adopted, (viii) AASB 2008-6 Further Amendments to inflation as a hedgeable component of a will be dependant on the level of qualifying Australian Accounting Standards arising from fixed rate debt. It also prohibits including assets, the level of borrowings associated the Annual Improvements Project time value in the one-sided hedged risk with those qualifying assets and interest (effective 1 July 2009) when designating options as hedges. costs on the borrowings. The amendments to AASB 5 Discontinued The Consolidated Entity intends to apply Operations and AASB 1 First-Time Adoption of the amended standard from 1 July 2009. It is Australian-Equivalents to International Financial not expected to have any impact on the Reporting Standards are part of the IASB’s Consolidated Entity’s financial statements. annual improvements project published

in May 2008. They clarify that all of a subsidiary’s assets and liabilities are classified as held-for-sale if a partial disposal sale plan results in loss of control. Relevant disclosures should be made for this subsidiary if the definition of a discontinued operation is met.

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2 Financial risk management 2 Financial risk management (continued) The Consolidated Entity’s activities expose it to a variety of financial risks: market risk (including currency risk and interest rate risk), credit The carrying amounts of the parent entity’s financial assets and liabilities are denominated in Australian dollars except as set out below: risk and liquidity risk. The Consolidated Entity’s overall risk management program focuses on the unpredictability of financial markets and All the foreign forward exchange contracts are hedging forecast purchases. seeks to minimise potential adverse effects on the financial performance of the Group. The Consolidated Entity uses derivative financial instruments, such as foreign exchange contracts, to manage these risks. Derivatives are exclusively used for hedging purposes, ie. not as trading or other speculative instruments. The Consolidated Entity uses different methods to measure different types of risk to which it is 30 June 2009 30 June 2008 exposed. These methods include sensitivity analysis in the case of foreign exchange risk and ageing analysis for credit risk. USD $’000 EURO $’000 SEK $’000 CAD $’000 EURO $’000 Other $’000 Risk management is carried out by the Company’s Executive Leadership Team (ELT) and the Company’s Hedging Committee (Hedging Forward exchange contracts Committee) under policies approved by the Board of Directors. The ELT and the Hedging Committee identify, evaluate and hedge 4,352 2,312 922 404 7,692 20 financial risks in close co-operation with the Consolidated Entity’s operating units. The Board provides written principles for overall risk ‑ buy foreign currency (cash flow hedges) management, as well as policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial Net exposure 4,352 2,312 922 404 7,692 20 instruments and non-derivative financial instruments, and investment of excess liquidity. The Consolidated Entity and the parent entity hold the following financial instruments: Consolidated Entity sensitivity

Consolidated Powerlink Queensland Based on the financial instruments held at 30 June 2009, had the Australian dollar weakened/strengthened by 10% against the hedged currencies, with all other variables held constant, the Consolidated Entity’s post-tax profit for the year would not have been affected as 2009 2008 2009 2008 $’000 $’000 $’000 $’000 the foreign forward exchange contracts are used to hedge the purchase of equipment for the construction of the Consolidated Entity’s transmission assets. Equity would have been $0.628M lower/$0.767M higher (2008 - $0.707M lower/$0.863M higher) had the Australian Financial assets dollar weakened/strengthened by 10% against the hedged currencies. Cash and cash equivalents (Note 7) 97,614 100,661 8 4,116 91,541 Parent entity sensitivity Trade and other receivables (Note 8) 52 ,114 65,741 51,675 65,406 Based on the financial instruments held at 30 June 2009, had the Australian dollar weakened/strengthened by 10% against the hedged Derivative financial instruments - 118 - 118 currencies, with all other variables held constant, the parent entity’s post-tax profit for the year would not have been affected as the Other financial assets 75,095 64,938 77,083 63,162 foreign forward exchange contracts are used to hedge the purchase of equipment for the construction of transmission assets. Equity would have been $0.628M lower/$0.767M higher (2008- $0.707M lower/$0.863M higher) had the Australian dollar weakened/strengthened by 224,823 231,458 212,874 220,227 10% against the hedged currencies. Financial liabilities (ii) Other Price risk Trade and other payables (Note 16) 100,610 180,975 100,625 180,985 The Consolidated Entity and the parent entity do not have any material exposure to equity securities price risk. Neither the Consolidated Borrowings (Note 20) 3,038,420 2,516,420 3,038,420 2,516,420 Entity nor the parent entity are exposed to commodity price risk. Derivative financial instruments 649 295 649 295 (iii) Interest rate risk 3,139,679 2,697,690 3,139,694 2,697,700 Consolidated Entity sensitivity The Consolidated Entity’s main interest rate risk would normally arise from its long-term borrowings. However, under lending (a) Market risk arrangements offered by QTC, the Company’s borrowings within its client specific pool approximate a fixed rate loan and consequently are insensitive to movements in interest rates. Other long term borrowings are fixed rate loans for a specific period and are also insensitive (i) Foreign exchange risk to movements in interest rates. The Consolidated Entity is exposed to currency risk on purchases of materials that are denominated in a currency other than the Consolidated Entity’s functional currency. The materials are for the construction and maintenance of transmission assets. The Consolidated Entity borrows exclusively from QTC, a Queensland Government owned corporation. QTC manages the borrowings on behalf of the Consolidated Entity within agreed pre-determined benchmarks . The composition of the QTC debt instruments are managed Exchange rate exposures are managed within approved policy parameters using foreign forward exchange contracts. to align with the Company’s revenue outcomes from the Australian Energy Regulator (AER), which is issued by the AER every five years. The Consolidated Entity’s treasury risk management policy is to hedge between 50% and up to 100% of anticipated transactions Under the borrowing arrangements with QTC, the Company’s book interest rate is reviewed annually. Movements in book interest rates (material purchases) in the foreign currency where a firm construction commitment has been entered into and the amount exceeds a reflect additional borrowings and the results of active management during the period. The next book rate review is scheduled to take Board approved threshold. All projected purchases qualify as “highly probable” forecast transactions for hedge accounting purposes. affect from 30 June 2009. During 2009 and 2008, all the Consolidated Entity’s borrowings were denominated in Australian dollars. The carrying amounts of the Group’s and parent entity’s financial assets and liabilities are all denominated in Australian dollars. Parent Entity Sensitivity The parent entity’s main interest rate risk would normally arise from its long-term borrowings. However, under lending arrangements The Group’s exposure to foreign currency risk (contract value) at the reporting date was as follows: offered by QTC, the Company’s borrowings within its client specific pool approximate a fixed rate loan and consequently are insensitive to movements in interest rates. Other long term borrowings are fixed rate loans for a specific period and are also insensitive to movements in interest rates. 30 June 2009 30 June 2008 The parent entity borrows exclusively from QTC, a Queensland Government owned corporation. QTC manages the borrowings on behalf USD $’000 EURO $’000 SEK $’000 CAD $’000 EURO $’000 Other $’000 of the Parent Entity within agreed pre-determined benchmarks . The composition of the QTC debt instruments are managed to align with Forward exchange contracts the Company’s revenue outcomes from the Australian Energy Regulator (AER), which is issued by the AER every five years. Under the 4,352 2,312 922 404 7,692 20 ‑ buy foreign currency (cash flow hedges) borrowing arrangements with QTC, the Company’s book interest rate is reviewed annually. Movements in book interest rates reflect additional borrowings and the results of active management during the period. The next book rate review is scheduled to take affect Net exposure 4,352 2,312 922 404 7,692 20 from 30 June 2009. During 2009 and 2008, all the parent entity’s borrowings were denominated in Australian dollars.

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2 Financial risk management (continued) 2 Financial risk management (continued) (b) Credit risk Consolidated Entity - At 30 June 2009 0 - 12 Between Over Total Carrying Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in a financial loss to the months 1 and 5 years 5 years contractual Amount cash flows (assets)/ Consolidated Entity. liabilities Powerlink Queensland is primarily exposed to credit related losses through its provision of electricity transmission services to a small $’000 $’000 $’000 $’000 $’000 number of large customers (electricity generators, distributors and direct connect loads). The company only transacts with large reputable Non-derivatives entities. Where appropriate, suitable financial security, either through the regulatory regime arrangements in which the Company operates, Non-interest bearing 100,610 - - 100,610 100,610 or other forms such as parent guarantees and unconditional bank guarantees, is obtained. It is not expected that any of these customers will fail to meet their obligations. Fixed rate 189,153 756,655 3,314,342 4,260,150 3,038,420 Outside of the small number of major electricity network customers, trade receivables consists of a limited number of customers, spread Total non-derivatives 289,763 756,655 3,314,342 4,360,760 3,139,030 across diverse industries and geographical areas. Ongoing credit evaluation is performed on the financial condition of accounts receivable. Derivatives The credit risk on liquid funds and derivative financial instruments is limited because the counterparties are either banks or QTC, all of Gross settled - outflow 649 - - 649 649 whom have high credit-ratings assigned by international credit-rating agencies. Total derivatives 649 - - 649 649 The carrying amount of financial assets recorded in the financial statements, net of any allowances for losses, represents the Consolidated Entity’s maximum exposure to credit risk without taking into account the value of any collateral obtained. Consolidated Entity - At 30 June 2008 0 - 12 Between Over Total Carrying Details of any impairment of financial assets are contained in Note 8. months 1 and 5 years 5 years contractual Amount cash flows (assets)/ (c) Liquidity risk liabilities Ultimate responsibility for liquidity risk management rests with the Board of Directors, who have implemented an appropriate liquidity risk $’000 $’000 $’000 $’000 $’000 management framework for the management of the Consolidated Entity’s short, medium and long-term funding and liquidity requirements. Non-derivatives The Consolidated Entity manages liquidity risk by maintaining adequate reserves, banking facilities, reserve borrowing facilities and by Non-interest bearing 180,975 - - 180,975 180,975 continuously monitoring forecast and actual cash flows. Fixed rate 164,564 658,852 2,516,420 3,339,836 2,516,420 Surplus funds are invested with the QTC and have on-call access. Total non-derivatives 345,539 658,852 2,516,420 3,520,811 2,697,395 Financing arrangements Derivatives Under the funding arrangements entered into between the Company and the Company’s shareholding Ministers, any undrawn approved Gross settled - outflow 177 - - 177 177 funding lapses at the end of each financial year. The Company seeks approval from the shareholding Ministers for funding requirements for the forthcoming year on an annual basis, and these approved borrowings form part of the State of Queensland borrowing program. Total derivatives 177 - - 177 177 For the 2009/10 year the Company has secured approval for additional borrowings to meet forecast operational requirements. Should further additional funds beyond this requirement be required to maintain liquidity and/or meet operational requirements, approval for the additional funds must be sought from the shareholding Ministers. Parent - At 30 June 2009 0 - 12 Between Over Total Carrying months 1 and 5 years 5 years contractual Amount Maturities of financial liabilities cash flows (assets)/ liabilities The tables below analyse the Consolidated Entity’s and the parent entity’s financial liabilities, net and gross settled derivative financial instruments into relevant maturity groupings based on the remaining period at the reporting date to the contractual maturity date. $’000 $’000 $’000 $’000 $’000 The amounts disclosed in the table are the contractual undiscounted cash flows which represent interest payments for both the client Non-derivatives specific pool debt and other long term debt held with QTC. The “Over 5 years” category contains interest payments, an estimate of Non-interest bearing 100,625 - - 100,625 100,625 the payout value of the client specific pool debt (no fixed terms of repayment) and principal repayments for other long term fixed debt. Fixed rate 189,153 756,655 3,314,342 4,260,150 3,038,420 The Consolidated Entity does not have any interest rate swaps for which the cash flows would have been estimated using forward interest rates applicable at the reporting date. Total non-derivatives 289,778 756,655 3,314,342 4,360,775 3,139,045 Derivatives Gross settled - outflow 649 - - 649 649 Total derivatives 649 - - 649 649

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2 Financial risk management (continued) 3 Critical accounting judgements, estimates and assumptions Parent - At 30 June 2008 0 - 12 Between Over Total Carrying The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the months 1 and 5 years 5 years contractual Amount reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, cash flows (assets)/ liabilities, contingent liabilities, revenues and expenses. Management bases its judgements and estimates on historical experience and liabilities on other various factors it believes to be reasonable under the circumstances, the result of which form the basis of the carrying values $’000 $’000 $’000 $’000 $’000 of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different Non-derivatives assumptions and conditions. Non-interest bearing 180,985 - - 180,985 180,985 Management has identified the following critical accounting policies for which significant judgements, estimates and assumptions are made. Variable rate - - - - - Actual results may differ from these estimates under different assumptions and conditions and may materially affect the financial results or the financial position reported in future periods. Fixed rate 164,564 658,852 2,516,420 3,339,836 2,516,420 Total non-derivatives 345,549 658,852 2,516,420 3,520,821 2,697,405 Defined Benefit Plans Various actuarial assumptions are required when determining the Consolidated Entity’s post employment obligations. Derivatives These assumptions and the relative carrying amounts are discussed in Note 15. Gross settled - outflow 177 - - 177 177 Employee Entitlements Total derivatives 177 - - 177 177 Management judgement is applied in determining the following key assumptions used in the calculation of long service leave at balance date: future increases in salaries and wages (d) Fair value estimation The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for disclosure purposes. future oncost rates The fair value of financial instruments traded in active markets (such as publicly traded derivatives, and trading and available-for-sale experience of employee departures and periods of service. securities) is based on quoted market prices at the reporting date. The quoted market price used for financial assets held by the Recovery of Deferred Tax Equivalent Assets Consolidated Entity is the current bid price. Deferred tax equivalent assets are recognised for deductible temporary differences as management considers it is probable that future The fair value of financial instruments that are not traded in an active market (for example, investments in unlisted subsidiaries) is taxable profits will be available to utilise those temporary differences. determined using valuation techniques. The Group uses a variety of methods and makes assumptions that are based on market conditions existing at each balance date. Quoted market prices or dealer quotes for similar instruments are used for long-term debt instruments held. Revaluation of Property, Plant and Equipment Other techniques, such as estimated discounted cash flows, are used to determine fair value for the remaining financial instruments. The revaluation of property, plant and equipment is affected by the application of relevant Australian Bureau of Statistics indices at The fair value of forward exchange contracts is determined using forward exchange market rates at the reporting date. the end of each financial year. The fair value of forward foreign exchange contracts is determined using forward market rates at the reporting date. Fair Value of Property, Plant and Equipment The carrying value less impairment provision of trade receivables and payables are assumed to approximate their fair values due to their Due to the absence of an active market, supply system assets, freehold land and buildings and easements are carried at fair value where short-term nature. The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows fair value is estimated using an income based approach. Fair value is defined as the amount for which an asset could be exchanged between at the current market interest rate that is available to the Consolidated Entity for similar financial instruments. knowledgeable, willing parties in an arm’s length transaction. In assessing fair value, a number of key estimates and assumptions are adopted for expected future cash flows. These are discussed in Note 13. Fair values for each class of financial instrument are disclosed in the relevant notes.

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4 Revenue 6 Income tax equivalent expense Consolidated Powerlink Queensland Consolidated Powerlink Queensland 2009 2008 2009 2008 2009 2008 2009 2008 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Revenues from Continuing Operations (a) Income tax equivalent expense Grid Sales Revenue 633,595 561,279 633,595 561,279 Current tax 47,960 39,618 43,710 35,554 Total Grid Sales Revenue 633,595 561,279 633,595 561,279 Relating to origination and reversal of temporary differences 4,452 6,296 4,348 6,263 Other revenue Associates accounted for using the equity method (702) (1,021) - - Interest 17,724 19,517 3,201 5,843 51,710 44,893 48,058 41,817 Dividends - - 9,805 9,708 Consolidated Powerlink Queensland Other 31,495 30,839 31,495 30,839 2009 2008 2009 2008 Total Other Revenue 49,219 50,356 44,501 46,390 $’000 $’000 $’000 $’000 Total revenues from continuing operations 682,814 611, 635 678,096 607,669 (b) Numerical reconciliation of income tax equivalent expense to prima facie tax payable Profit from continuing operations before 5 Expenses from Continuing Operations income tax equivalent expense 173,582 148,026 170,948 147,235 Consolidated Powerlink Queensland Tax equivalent at the Australian tax rate of 30% (2008: 30%) 52,075 44,408 51,284 44,171 2009 2008 2009 2008 Increase in income tax equivalent expense due to: $’000 $’000 $’000 $’000 Non deductible expenses 17 16 16 16 Profit before income tax equivalent includes the following specific expenses: Temporary Differences 54,164 48,524 54,164 48,524 Finance costs Decrease in income tax equivalent expense due to: Interest Expense 169,588 137,824 169,588 137,824 Tax exempt revenues (52) (74) (2,912) (2,913) Other 10,692 8,897 10,692 8,897 Building write-off (393) (357) (393) (357) Total Finance Costs Expensed 180,281 146,721 180,281 146,721 Temporary differences (58,450) (53,888) (58,450) (53,888) Operational Expenses Adjustments to Asset Revaluation Reserve - - - - Network Operations 11,815 10,596 11,815 10,596 Other movements in deferred tax 4,349 6,264 4,349 6,264 Network Maintenance 73,340 67,297 73,340 67,297 Income tax equivalent expense 51,710 44,893 48,058 41,817 Grid Support 15,080 27,326 15,080 27,326 Total income tax expense 51,710 44,893 48,058 41,817 Corporate/Business Support 46,174 40,833 46,163 40,815 Other 8,207 9,557 8,207 9,557 Consolidated Powerlink Queensland Depreciation 172,262 158,122 172,262 158,122 2009 2008 2009 2008 Total Operational Expenses 326,878 313,731 326,867 313,713 $’000 $’000 $’000 $’000 Employee benefit expense included in the Income Statement 50,450 48,197 50,450 48,197 (c) Amounts recognised directly in equity Net deferred tax - debited (credited) Defined Contribution Superannuation Expense directly to equity (Notes 14 and 22) 34,269 4 4,711 34,269 44,707 included in the Income Statement 3,460 3,319 3,460 3,319 34,269 4 4,711 34,269 44,707 53,910 51,516 53,910 51,516

(d) Tax consolidation legislation Powerlink Queensland and its wholly-owned Australian controlled entities have implemented the tax consolidation legislation. The accounting policy in relation to this legislation is set out in Note 1(f). On adoption of the tax consolidation legislation, the entities in the tax consolidated group entered into a tax sharing agreement which, in the opinion of the directors, limits the joint and several liability of the wholly-owned entities in the case of a default by the head entity, Powerlink Queensland.

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6 Income tax equivalent expense (continued) 8 Current assets – Trade and other receivables (continued) The entities have also entered into a tax funding agreement under which the wholly-owned entities fully compensate Powerlink (a) Provision for Impairment of receivables Queensland for any current tax payable assumed and are compensated by Powerlink Queensland for any current tax receivable and The Consolidated Entity has not considered it necessary to raise a provision for the impairment of receivables. deferred tax assets relating to unused tax losses or unused tax credits that are transferred to Powerlink Queensland under the tax consolidation legislation. The funding amounts are determined by reference to the amounts recognised in the wholly-owned entities’ (b) Impaired Trade Receivables financial statements. The Consolidated Entity has recognised a loss of $3 thousand (2008: $16 thousand) in respect of impaired trade receivables The amounts receivable/payable under the tax funding agreement are due upon receipt of the funding advice from the head entity, which during the year ended 30 June 2009 is issued as soon as practicable after the end of each financial year. The head entity may also require payment of interim funding amounts As of 30 June 2009, trade receivables of $2,900 thousand (2008 - $3,219 thousand) were past due but not impaired. to assist with its obligations to pay tax instalments. The funding amounts are recognised as current intercompany receivables or payables These relate to a number of independent customers for whom there is no recent history of default. The ageing analysis (see Note 31(e)). of these trade receivables is as follows: Consolidated Powerlink Queensland 7 Current assets - Cash and cash equivalents 2009 2008 2009 2008 $’000 $’000 $’000 $’000 Consolidated Powerlink Queensland Up to 3 months 708 3,028 708 3,028 2009 2008 2009 2008 $’000 $’000 $’000 $’000 3 to 6 months 2,192 191 2,192 191 Cash balance comprises: 2,900 3,219 2,900 3,219 Cash on hand 7 8 7 8 Bank balances 3,059 (103) 3,057 (108) (c) Other receivables Cash on Deposit with Qld Treasury Corporation (QTC) 75,924 19,762 62,428 10,647 For the parent entity, these are receivables from tax consolidated entities under the tax funding agreement, see Note 6(d) and Note 31(e). Cash on Deposit with QTC - IRSR (Note 37) 18,624 80,994 18,624 80,994 (d) Foreign exchange and interest rate risk Closing Cash balance 97,614 100,661 8 4,116 91,541 Information about the Consolidated Entity’s and the parent entity’s exposure to foreign currency risk and interest rate risk in relation to trade and other receivables is provided in Note 2.

(e) Fair value and credit risk (a) Risk exposure Due to the short-term nature of these receivables, their carrying amount is assumed to approximate their fair value. The Consolidated Entity’s and the parent entity’s exposure to interest rate risk is discussed in Note 2. The maximum exposure to credit risk at the reporting date is the carrying amount of each class of cash and cash equivalents mentioned above. 9 Current assets - Inventories (b) Deposits at call Consolidated Powerlink Queensland Cash on deposit with QTC earns interest at floating rates based on daily QTC deposit rates. 2009 2008 2009 2008 Cash at bank earns interest at floating rates based on daily bank deposit rates. $’000 $’000 $’000 $’000 Maintenance and Construction Stock 31,409 27,513 31,409 27,513 (c) Fair value The carrying amount for cash and cash equivalents equals the fair value. 31,409 27,513 31,409 27,513

10 Current assets - Other current assets 8 Current assets - Trade and other receivables Consolidated Powerlink Queensland Consolidated Powerlink Queensland 2009 2008 2009 2008 2009 2008 2009 2008 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Work in Progress - Customer Works 702 451 702 451 Net trade receivables Prepayments 6,920 6,831 6,920 6,831 Trade receivables 48,486 62,453 48,485 62,452 Other 65 205 65 205 Other 3,628 3,288 3,190 2,954 7,687 7,487 7,687 7,487 52 ,114 65,741 51,675 65,406

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11 Non-current assets - Investments accounted for using the equity method 13 Non-current assets - Property, plant and equipment Consolidated Powerlink Queensland Other 2009 2008 2009 2008 Freehold Supply Property, $’000 $’000 $’000 $’000 Work in Land and System Plant and Consolidated Progress Easements Buildings Assets Equipment Total Shares in Associates (Note 33) 38,844 46,720 - - $’000 $’000 $’000 $’000 $’000 $’000 38,844 46,720 - - At 1 July 2007

- Valuation 526,766 338,143 45,322 3,332,254 57,708 4,300,193 (a) Shares in Associates Investments in Associates are accounted for in the consolidated financial statements using the equity method of accounting and are carried Accumulated depreciation - - (2,806) (356,182) (25,906) (384,894) at cost by the subsidiary entities holding the investments (Notes 12, 33). Net book amount 526,766 338,143 42,516 2,976,072 31,802 3,915,299

12 Non-current assets - Other financial assets Year ended 30 June 2008 Consolidated Powerlink Queensland Opening net book amount 526,766 338,143 42,516 2,976,072 31,802 3,915,299 2009 2008 2009 2008 Additions 675,844 - - - - 675,844 $’000 $’000 $’000 $’000 Disposals - (571) - - (911) (1,482) Advances to Associates Revaluation increments/(decrements) - 14,592 1,790 151,158 - 167,540 Loan Notes 73,467 64,731 - - Transfers - - (22) - 22 - Advances to Associates Transfers from work in progress (651,315) 9,723 91 629,514 11,987 - Shares in subsidiaries* (Note 32) - - 1 1 Depreciation charge - - (1,322) (145,935) (10,865) (158,122) Unsecured Loans to Subsidiaries# - - 75,454 62,954 Closing net book amount 551,295 361,887 43,053 3,610,809 32,035 4,599,079 73,467 64,731 75,455 62,955

* Represents investments in unlisted controlled entities at cost At 30 June 2008 # Represents unsecured advances to Harold Street Holdings Pty Ltd of $75,450 thousand (2008: $62,950 thousand) and Powerlink Transmission Services Pty Ltd - Directors’ Valuation 551,295 361,887 47,229 4,104,711 67,633 5,132,755 $4 thousand (2008: $4 thousand). Both companies are wholly owned subsidiaries of Powerlink Queensland (Note 32). Accumulated depreciation - - (4,176) (493,902) (35,598) (533,676) Net book amount 551,295 361,887 43,053 3,610,809 32,035 4,599,079

Other Freehold Supply Property, Work in Land and System Plant and Consolidated Progress Easements Buildings Assets Equipment Total $’000 $’000 $’000 $’000 $’000 $’000 Year ended 30 June 2009 Opening net book amount 551,295 361,887 43,053 3,610,809 32,035 4,599,079 Additions 674,270 - - - - 674,270 Disposals - (1,647) - (1,954) (472) (4,073) Revaluation increments/(decrements) - 9,872 1,335 111,649 - 122,856 Transfers ------Transfers from work in progress (667,216) 22,835 6,336 620,163 17,882 - Depreciation charge - - (1,506) (158,598) (12,158) (172,262) Closing net book amount 558,349 392,947 49,218 4,182,069 37,287 5,219,870

At 30 June 2009 - Directors’ Valuation 558,349 392,947 54,944 4,839,430 83,151 5,928,821 Accumulated depreciation - - (5,726) (657,361) (45,864) (708,951) Net book amount 558,349 392,947 49,218 4,182,069 37,287 5,219,870

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13 Non-current assets - Property, plant and equipment (continued) 13 Non-current assets - Property, plant and equipment (continued) Other (a) Leased assets Freehold Supply Property, Supply System Assets include the following amounts which are subject to a cross border lease: Work in Land and System Plant and Powerlink Queensland Progress Easements Buildings Assets Equipment Total Consolidated Powerlink Queensland $’000 $’000 $’000 $’000 $’000 $’000 2009 2008 2009 2008 $’000 $’000 $’000 $’000 At 1 July 2007 Cross Border lease - Supply System Assets - Valuation 526,766 338,143 45,322 3,332,254 57,708 4,300,193 At Directors’ valuation 4,552,079 3,857,093 4,552,079 3,857,093 Accumulated depreciation - - (2,806) (356,182) (25,906) (384,894) Accumulated depreciation (611,693) (459,172) (611,693) (459,172) Net book amount 526,766 338,143 42,516 2,976,072 31,802 3,915,299 Net book amount 3,940,386 3,397,921 3,940,386 3,397,921

Year ended 30 June 2008 (b) Valuation of property, plant and equipment Opening net book amount 526,766 338,143 42,516 2,976,072 31,802 3,915,299 Powerlink’s supply system assets, freehold land and building and easements are carried at fair value. An income based approach Additions 675,844 - - - - 675,844 to valuation was undertaken by Powerlink as at 30 June 2009 using the following key assumptions and approach: Disposals - (571) - - (911) (1,482) a major proportion of Powerlink’s assets are subject to regulation in the form of a revenue cap and it is assumed that they Revaluation increments/(decrements) - 14,592 1,790 151,158 - 167,540 will continue to be subject to regulation in the future Transfers - - (22) - 22 - cash flows have been projected based on forecasts of prudent and efficient operating costs and revenue consistent with Transfers from work in progress (651,315) 9,723 91 629,514 11,987 - existing regulatory determinations, regulatory methodologies and existing connection and access agreements which satisfy Depreciation charge - - (1,322) (145,935) (10,865) (158,122) fair value definitions contained in relevant accounting standards Closing net book amount 551,295 361,887 43,053 3,610,809 32,035 4,599,079 future capital expenditure and related revenues have been excluded from the cash flows residual asset values have been determined using the best information available. At 30 June 2008 - Directors’ Valuation 551,295 361,887 47,229 4,104,711 67,633 5,132,755 Accumulated depreciation - - (4,176) (493,902) (35,598) (533,676) 14 Non-current assets - Deferred income tax equivalent assets Net book amount 551,295 361,887 43,053 3,610,809 32,035 4,599,079 Consolidated Powerlink Queensland 2009 2008 2009 2008 $’000 $’000 $’000 $’000 Other Freehold Supply Property, The balance comprises temporary differences attributable to: Work in Land and System Plant and Accruals 34 58 34 56 Powerlink Queensland Progress Easements Buildings Assets Equipment Total Provisions 10,344 10,049 10,344 10,049 $’000 $’000 $’000 $’000 $’000 $’000 Cash flow hedges (Note 25(a)) 195 89 195 89 Year ended 30 June 2009 Total deferred tax equivalent assets 10,573 10,196 10,573 10,194 Opening net book amount 551,295 361,887 43,053 3,610,809 32,035 4,599,079

Additions 674,270 - - - - 674,270 Set-off of deferred tax equivalent liabilities Disposals - (1,647) - (1,954) (472) (4,073) pursuant to set-off provisions (Note 22) (10,573) (10,196) (10,573) (10,194) Revaluation increments/(decrements) - 9,872 1,335 111,649 - 122,856 Net deferred tax equivalent assets - - - - Transfers ------Transfers from work in progress (667,216) 22,835 6,336 620,163 17,882 - Depreciation charge - - (1,506) (158,598) (12,158) (172,262) Closing net book amount 558,349 392,947 49,218 4,182,069 37,287 5,219,870

At 30 June 2009 - At Directors’ Valuation 558,349 392,947 54,944 4,839,430 83,151 5,928,821 Accumulated depreciation - - (5,726) (657,361) (45,864) (708,951) Net book amount 558,349 392,947 49,218 4,182,069 37,287 5,219,870

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14 Non-current assets - Deferred income tax equivalent assets (continued) 15 Employee Benefits and Superannuation Commitments (continued) Consolidated Powerlink Queensland (b) Superannuation Plan 2009 2008 2009 2008 The Consolidated Entity contributes to an industry multiple employer superannuation fund, the Electricity Supply Industry Superannuation $’000 $’000 $’000 $’000 Fund (Qld). Members, after serving a qualifying period , are entitled to benefits from this scheme on retirement, resignation, retrenchment, Movements: disability or death. The Consolidated Entity has one plan with a defined benefit section and a defined contribution section. The defined Opening balance at 1 July 10,196 10,019 10,194 10,015 benefit section is only open to existing employees who have always been in the section, and is not open to new employees. Credited/(charged) to the income statement (Note 6) 271 308 273 306 The defined benefit account of this Fund provides defined lump sum benefits based on years of service and final average salary. Employee contributions to the scheme are based on percentages of their salaries and wages. The Consolidated Entity also Credited/(charged) to equity 106 (131) 106 (127) contributes to the plan. Closing balance at 30 June 10,573 10,196 10,573 10,194 The Trust Deed of the Fund states that, if the Fund winds up, after the payment of all costs and the payment of all member benefits in respect of the period up to the date of termination, any remaining assets are to be distributed by the Trustee of the Fund, acting Deferred tax equivalent assets to be recovered on the advice of an actuary to the participating employers. within 12 months 4,725 3,643 4,725 3,641 The Consolidated Entity may at any time, by notice to the Trustee, terminate its contributions. The employer has a liability to pay Deferred tax equivalent assets to be recovered the monthly contributions due prior to the effective date of the notice, but there is no requirement for an employer to pay any after more than 12 months 5,848 6,553 5,848 6,553 further contributions, irrespective of the financial condition of the Fund. 10,573 10,196 10,573 10,194 The Consolidated Entity may benefit from any surplus in the Fund in the form of a contribution reduction. Any reduction in contributions would normally be implemented only after advice from the Fund’s actuary. 15 Employee Benefits and Superannuation Commitments All monetary amounts are in Australian dollars and have been rounded to the nearest $1,000. Actuarial gains or losses associated (a) Performance Payments to Employees with the defined benefit plan are recognised directly in retained earnings. Information in respect of each category of performance related payment is as follows: The following sets out details in respect of the defined benefit section only. The expense recognised in relation to the defined contribution section is disclosed in Note 5. Performance Payments - Other Key Management Personnel Performance payments to other key management personnel are dependent on the performance of individual key management personnel (c) Defined Benefit Plan asset recognised on the balance sheet against pre-agreed business and individual targets. The performance payments made in the 2008/09 year were granted/approved by the The amounts recognised in the balance sheet are determined as follows: Board on 18 September 2008. There have not been any alterations of the terms and conditions to the grant since the grant/approval date. Consolidated Powerlink Queensland Performance Payments - All Other Employees 2009 2008 2009 2008 $’000 $’000 $’000 $’000 Performance payments to all other employees are dependent on the performance of employees against individual/team pre-agreed performance targets. The performance payments made in the 2008/09 year were granted/approved by the Board on 16 September 2008. Fair value of defined benefit plan assets 69,138 70,219 69,138 70,219 There have not been any alterations of the terms and conditions to the grant since the grant/approval date. Present value of the defined benefit obligation (63,729) (56,614) (63,729) (56,614) Gainsharing Payments Net surplus in the balance sheet 5,409 13,605 5,409 13,605 Gainsharing payments are available to award employees based on the Company results. The amount is a fixed sum for all eligible employees. The payment made in 2008/09 was granted/approved by the Board on 16 September 2008. There have not been any alterations of the terms and conditions to the grant since the grant/approval date. (d) Categories of plan assets The major categories of plan assets are as follows: At-Risk Performance Remuneration Consolidated Powerlink Queensland The aggregate at risk employee remuneration is as follows: 2009 2008 2009 2008 2008/09 2007/08 % % % % Aggregrate at-risk performance remuneration $5.224m $4.571m Cash 7.0 6.9 7.0 6.9 Total salaries and wages paid $100.240m $92.932m Fixed Interest 16.0 19.8 16.0 19.8 Number of employees receiving performance payments 849 765 Domestic Equities 21.0 22.7 21.0 22.7 Alternatives 20.0 8.9 20.0 8.9 Number of Employees International Equities 21.0 29.4 21.0 29.4 Number of employees (full-time equivalents) at year end: 906 (2008: 887) Property 15.0 12.3 15.0 12.3 100.0 100.0 100.0 100.0

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15 Employee Benefits and Superannuation Commitments (continued) 15 Employee Benefits and Superannuation Commitments (continued) (e) Reconciliations (g) Defined Benefit Plan amounts recognised in Statement of Recognised Income and Expense

Consolidated Powerlink Queensland Consolidated Powerlink Queensland 2009 2008 2009 2008 2009 2008 2009 2008 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Reconciliation of the present value of the defined Actuarial (loss)/gain recognised in the year (8,644) (13,155) (5,709) (13,343) benefit obligation, which is fully funded: Cumulative actuarial (losses)/gains recognised in the Balance at the beginning of the year (56,614) (57,579) (56,614) (57,579) Statement of Recognised Income and Expense (3,370) 5,274 (1,934) 3,775 Current service cost (2,654) (2,715) (2,654) (2,715) (h) Principal actuarial assumptions Interest cost (2,824) (2,809) (2,824) (2,809) The principal actuarial assumptions used (expressed as weighted averages) were as follows: Contributions by members (864) (834) (864) (834) Consolidated Powerlink Queensland Actuarial gains and (losses) (4,532) (2,580) (4,532) (2,580) 2009 2008 2009 2008 Benefits paid 2,313 6,778 2,313 6,778 Discount rate 4.7% 5.4% 4.7% 5.4% Provisions for Contributions Tax 1,446 3,125 1,446 3,125 Expected return on plan assets 6.0% 6.5% 6.0% 6.5% Balance at the end of the year (63,729) (56,614) (63,729) (56,614) Future salary increases 4.5% 4.5% 4.5% 4.5%

Consolidated Powerlink Queensland The expected rate of return on assets has been based on historical and future expectations of returns for each of the 2009 2008 2009 2008 major categories of asset classes as well as the expected and actual allocation of plan assets to these major categories. $’000 $’000 $’000 $’000 (i) Employer contributions Reconciliation of the fair value of plan assets: Employer contributions to the defined benefit section of the plan are based on recommendations by the Fund’s actuary. Balance at the beginning of the year 70,219 88,891 70,219 88,891 Actuarial assessments are made at no more than three yearly intervals, and the last such assessment was effective as at 1 July 2008. Expected return on plan assets 4,351 5,547 4,351 5,547 The objective of funding is to ensure that the benefit entitlements of members and other beneficiaries are fully funded by the time Actuarial gains and (losses) (5,069) (19,606) (5,069) (19,606) they become payable. To achieve this objective the actuary has adopted a method of funding known as the aggregrate funding method. Contributions by Company 1,440 1,331 1,440 1,331 This funding method seeks to have benefits funded by a total contribution which is expected to be a constant percentage of members Contributions by members 864 834 864 834 salaries and wages over their working lifetimes. Benefits paid (2,313) (6,778) (2,313) (6,778) Funding recommendations made by the actuary are based on assumptions of various matters such as future salary levels, mortality rates, Other cash Flow (354) - (354) - membership turnover and interest rates. Balance at the end of the year 69,138 70,219 69,138 70,219 Using the funding method described above and the abovementioned actuarial assumptions as to plans and future experience, the Fund’s actuary has not recommended that additional contributions beyond the current contribution level be made.

(f) Defined Benefit Plan amounts recognised in the Income Statement (j) Historic summary The amounts recognised in the income statement are as follows: 2009 2008 2007 2006 2005 $’000 $’000 $’000 $’000 $’000 Consolidated Powerlink Queensland Defined benefit plan assets 69,138 70,219 88,891 77,081 65,210 2009 2008 2009 2008 $’000 $’000 $’000 $’000 Defined benefit plan obligation (63,729) (56,614) (57,579) (56,159) (51,512) Current service cost 2,654 2,715 2,654 2,715 Surplus / (deficit) 5,409 13,605 31,312 20,922 13,698 Interest cost 2,824 2,809 2,824 2,809 Expected return on plan assets (4,351) (5,547) (4,351) (5,547) Experience adjustments arising on plan assets (5,069) (19,606) 7,286 5,570 4,942 Other 354 - 354 - Experience adjustments arising on plan liabilities (544) (3,115) 1,358 (2,059) (3,119) Total included in employee benefits expense 1,481 (23) 1,481 (23) Information for years prior to 2005 is not available.

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16 Current liabilities - Trade and other payables 17 Current liabilities - Provisions (continued) Consolidated Powerlink Queensland (c) Amounts not expected to be settled within the next 12 months 2009 2008 2009 2008 The current provision for annual leave includes all unconditional entitlements where employees have completed the required period $’000 $’000 $’000 $’000 of service and also those where employees are entitled to pro-rata payments in certain circumstances. The entire amount is presented Trade payables 80,174 98,331 80,189 98,341 as current, since the Consolidated Entity does not have an unconditional right to defer settlement. However, based on past experience, Deposits 38 176 38 176 the Consolidated Entity does not expect all employees to take the full amount of accrued annual leave or require payment within the next 12 months. The following amounts reflect leave that is not expected to be taken or paid within the next 12 months. IRSR (refer Notes 1(y),37) 18,624 80,994 18,624 80,994

Other payables 1,774 1,474 1,774 1,474 Consolidated Powerlink Queensland 100,610 180,975 100,625 180,985 2009 2008 2009 2008 $’000 $’000 $’000 $’000 (a) Fair Value Annual leave obligation expected to be settled after 12 months 2,615 2,791 2,615 2,791 The carrying amounts of the Consolidated Entity’s and parent entity’s trade and other payables is a reasonable approximation of fair value. 18 Current liabilities - Current tax equivalent liabilities 17 Current liabilities - Provisions Consolidated Powerlink Queensland Consolidated Powerlink Queensland 2009 2008 2009 2008 2009 2008 2009 2008 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Income tax equivalents 8,387 387 8,387 387 Employee benefits 16,846 16,266 16,846 16,266 Total Current tax equivalent liabilities 8,387 387 8,387 387 Environmental Restoration (a) 100 100 100 100 Dividends 98,808 84,412 98,808 84,412 19 Current liabilities - Other current liabilities 115,754 100,778 115,754 100,778 Consolidated Powerlink Queensland

2009 2008 2009 2008 (a) Environmental restoration $’000 $’000 $’000 $’000 Provision is made for the estimated costs associated with the removal and destruction of polychlorinated biphenyl contaminated liquids Unearned revenue 4,412 14,651 4,412 14,651 and solid wastes from power transformers. These costs have been determined on a discounted basis based on current costs, current Derivative financial instruments 649 295 649 295 legal requirements and current technology. Changes in estimates are dealt with on a prospective basis. Other 2,391 - 2,391 - (b) Movements in provisions Total Other current liabilities 7,452 14,946 7,452 14,946 Movements in each class of provision during the financial year, other than employee benefits, are set out below: Environmental Restoration Dividends 20 Non-current liabilities - Interest bearing loans and borrowings $’000 $’000 Consolidated Powerlink Queensland Consolidated - 2009 2009 2008 2009 2008 Current $’000 $’000 $’000 $’000 Carrying amount at start of year 100 84,412 Unsecured Charged/(credited) to the income statement Queensland Treasury Corporation 3,038,420 2,516,420 3,038,420 2,516,420 - additional provisions recognised - 98,808 Total non-current borrowings 3,038,420 2,516,420 3,038,420 2,516,420 Amounts used during the year - (84,412) Carrying amount at end of year 100 98,808

Powerlink Queensland - 2009 Current Carrying amount at start of year 100 84,412 Charged/(credited) to the income statement - additional provisions recognised - 98,808 Amounts used during the year - (84,412) Carrying amount at end of year 100 98,808

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20 Non-current liabilities - Interest bearing loans and borrowings (continued) 22 Non-current liabilities - Deferred income tax equivalent liabilities (a) Fair value Consolidated Powerlink Queensland The carrying amounts and fair values of borrowings at balance date are: 2009 2008 2009 2008 $’000 $’000 $’000 $’000 At 30 June 2009 At 30 June 2008 The balance comprises temporary differences attributable to: Carrying Fair Carrying Fair Property, plant and equipment 343,130 300,686 343,130 300,686 Consolidated Entity amount value amount value Receivables 211 1,132 211 1,132 $’000 $’000 $’000 $’000 343,341 301,818 343,341 301,818 On-balance sheet (i) QTC Loans 3,038,420 3,097,789 2,516,420 2,427,411 Other 3,038,420 3,097,789 2,516,420 2,427,411 Prepayments - - - - Defined Benefit Fund Surplus 1,623 4,082 1,623 4,082 At 30 June 2009 At 30 June 2008 Inventories - 33 - 33 Carrying Fair Carrying Fair Cash flow hedges - 35 - 35 Powerlink Queensland amount value amount value $’000 $’000 $’000 $’000 Associates Accounted for using the Equity Method 26,484 28,847 - - On-balance sheet (i) Interest receivable 1,089 986 - - QTC Loans 3,038,420 3,097,789 2,516,420 2,427,411 Sub-total other 29,196 33,983 1,623 4,150 3,038,420 3,097,789 2,516,420 2,427,411 Total deferred tax liabilities 372,537 335,801 344,964 305,968

(i) On-balance sheet Set-off of deferred tax equivalent assets The borrowings are carried on the Balance Sheet at an amount different to the aggregrate net fair value. pursuant to set-off provisions (Note 14) (10,573) (10,196) (10,573) (10,194) The Directors have not caused those liabilities to be adjusted to the aggregrate net fair value as it is intended to retain those securities until maturity. Net deferred tax equivalent liabilities 361,964 325,605 334,391 295,774 The carrying amounts of the Group’s borrowings are denominated in Australian dollars.

(b) Risk exposures Movements: Information about the Group’s and parent entity’s exposure to interest rate changes is provided in Note 2. Opening balance at 1 July 335,801 278,262 305,968 254,887 Charged/(credited) to the income statement (Note 6) 3,864 6,602 4,463 6,570 21 Non-current liabilities - Other financial liabilities Charged/(credited) to equity (Notes 24, 25) 32,713 51,005 34,374 44,579 Consolidated Powerlink Queensland Prior year adjustment 159 (68) 159 (68) 2009 2008 2009 2008 Closing balance at 30 June 372,537 335,801 344,964 305,968 $’000 $’000 $’000 $’000 Unearned Revenue 16,343 8,408 16,343 8,408 Deferred tax equivalent liabilities Other 1,084 979 1,084 979 to be settled within 12 months 1,300 2,187 211 1,201 Total Other financial liabilities 17,427 9,387 17,427 9,387 Deferred tax equivalent liabilities to be settled after more than 12 months 371,237 333,614 344,753 304,767 372,537 335,801 344,964 305,968

23 Non-current liabilities - Provisions Consolidated Powerlink Queensland 2009 2008 2009 2008 $’000 $’000 $’000 $’000 Employee benefits 20,197 17,816 20,197 17,816 Environmental Restoration 1,546 2,291 1,546 2,291 21,743 20,107 21,743 20,107

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23 Non-current liabilities - Provisions (continued) 24 Contributed equity Movements in each class of provision during the financial year, other than employee benefits, are set out below: Powerlink Queensland Powerlink Queensland Environmental 2009 2008 2009 2008 Restoration Shares ‘000 Shares ‘000 $’000 $’000 (a) Share capital $’000 Consolidated - 2009 Ordinary shares Non-current Fully paid 401,000 401,000 401,000 401,000 Carrying amount at start of year 2,291 401,000 401,000 401,000 401,000 Charged/(credited) to the income statement Amounts used during the year (745) (b) Capital risk management Carrying amount at end of year 1,546 The Consolidated Entity’s and the parent entity’s objectives when managing capital are to safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal

capital structure in line with shareholding Minister expectations. Consolidated - 2008 Non-current The Consolidated Entity’s overall strategy remains unchanged, to maintain at least an “investment grade” business credit rating. Carrying amount at start of year 1,994 The capital structure of the Consolidated Entity consists of debt, which includes borrowings disclosed in Note 20, cash and cash Charged/(credited) to the income statement 297 equivalents and equity attributable to equity holders of the Company, comprising issued capital, reserves and retained earnings as disclosed in Notes 24, 25(a) and (b) respectively. Amounts used during the year - Carrying amount at end of year 2,291 In order to maintain or adjust the capital structure, the Consolidated Entity may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.

Powerlink Queensland - 2009 Operating cash flows are used to maintain and expand the Consolidated Entity’s transmission assets, as well as to make Non-current routine outflows of tax, dividends and servicing of debt. Carrying amount at start of year 2,291 The Consolidated Entity’s policy is to borrow centrally using facilities provided by QTC to meet anticipated funding requirements. Charged/(credited) to the income statement There has not been any changes in strategy or policy subsequent to the previous period (2007/08 financial year). Amounts used during the period (745) Gearing ratio Carrying amount at end of year 1,546 The Consolidated Entity’s management monitor capital on the basis of a gearing ratio on an annual basis through its reporting to the Board and shareholding Ministers and QTC. This ratio is calculated as debt to fixed assets. Powerlink Queensland - 2008

Non-current Consolidated Powerlink Queensland Carrying amount at start of year 1,994 2009 2008 2009 2008 Additional provision recognised - charged to plant and equipment 297 $’000 $’000 $’000 $’000 Total debt 3,038,420 2,516,420 3,038,420 2,516,420 Charged/(credited) to the income statement Fixed Assets 5,219,870 4,599,079 5,219,870 4,599,079 Amounts used during the period - Gearing ratio-debt to fixed assets 58.2% 54.7% 58.2% 54.7% Carrying amount at end of year 2,291

The increase in the gearing ratio during 2009 resulted primarily from the increased borrowings to finance the Consolidated Entity’s capital expenditure program. Debt is defined as long and short term borrowings. For 2008/09 the Consolidated Entity had only long term borrowings Fixed Assets is Property, Plant and Equipment. (Note 13)

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24 Contributed equity (continued) 25 Reserves and retained profits (continued) (c) Issued and Paid Up Capital (b) Retained Earnings Consists of 2 “A” class voting shares of $1.00 each and 400,999,998 “B” Class non-voting shares of $1.00 each. Movements in retained earnings were as follows: Changes to the then Corporations Law abolished the authorised capital and par value concept in relation to share capital from 1 July 1998. Consolidated Powerlink Queensland Therefore, the Company does not have a limited amount of authorised capital, and issued shares do not have a par value. 2009 2008 2009 2008 $’000 $’000 $’000 $’000 There was no movement in the issued and paid up capital during the 2008/09 financial year. Opening retained earnings 1,000,817 995,179 1,004,942 997,279 (d) Terms and Conditions of Contributed Equity - Ordinary Shares Net profit attributable to members of Powerlink Queensland 121,872 103,133 122,890 105,418 Ordinary shares entitle the holder to receive dividends as declared and, in the event of winding up of the Company, to participate Dividends provided for or paid (98,808) (84,412) (98,808) (84,412) in the proceeds from the sale of all surplus assets in proportion to the number of, and amounts paid up, on shares held. Actuarial gains(losses) on defined benefit plans recognised Holders of “A” Class ordinary shares are entitled to one vote per share at shareholders’ meetings. directly in retained earnings (Note 15(g)) (8,644) (13,155) (5,709) (13,343) Change in 2006/07 value of Associates - 72 - - 25 Reserves and retained profits Balance 30 June 1,015,237 1,000,817 1,023,315 1,004,942 Consolidated Powerlink Queensland (c) Nature and purpose of reserves 2009 2008 2009 2008 $’000 $’000 $’000 $’000 (i) Asset Revaluation Reserve (a) Reserves The property, plant and equipment revaluation reserve is used to record increments and decrements arising from the revaluation of non-current assets, and investments in Associates measured at fair value in accordance with the applicable Australian Accounting Asset Revaluation Reserve 449,157 355,290 409,190 323,191 Standards - Note 1(n). The balance standing to the credit of the reserve may be used to satisfy the distribution of bonus shares to Hedging Reserve (9,109) 32 (455) (124) shareholders and is only available for the payment of cash dividends in limited circumstances as permitted by law. 440,048 355,322 408,735 323,067 (ii) Hedging Reserve The hedging reserve is used to record gains or losses on a hedging instrument in a cash flow hedge that are recognised directly in equity, Consolidated Powerlink Queensland as described in Note 1(l). Amounts are recognised in the Income Statement when the associated hedged transaction affects profit and loss. 2009 2008 2009 2008 $’000 $’000 $’000 $’000 Movements: Asset Revaluation Reserve Balance 1 July 355,290 220,219 323,191 205,913 Revaluation - gross (Note 13) 122,856 167,540 122,856 167,540 Deferred tax (Note 22) (36,857) (50,262) (36,857) (50,262) Revaluation - Associate (Note 33) 11, 241 25,419 - - Deferred tax - Associate (Note 22) (3,373) (7,626) - - Balance 30 June 449,157 355,290 409,190 323,191

Consolidated Powerlink Queensland 2009 2008 2009 2008 $’000 $’000 $’000 $’000 Movements: Hedging Reserve Balance 1 July 32 256 (124) (506) Revaluation - gross (472) 546 (472) 546 Deferred tax (Notes 14 and 22) 141 (164) 141 (164) Associate (12,586) (865) - - Deferred tax - Associate (Notes 14 and 22) 3,776 259 - - Balance 30 June (9,109) 32 (455) (124)

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26 Dividends 27 Key management personnel disclosures (continued) Consolidated Powerlink Queensland (c) Details of remuneration 2009 2008 2009 2008 (i) Details of the nature and amount of each major element of the remuneration of each Director are: $’000 $’000 $’000 $’000 Unfranked final dividend proposed 98,808 84,412 98,808 84,412 2009 Short Term Post- employment 98,808 84,412 98,808 84,412 Name Fixed Remuneration $’000 Superannuation $’000 Total $’000 Else Shepherd 53 5 58 In consultation with the shareholding Ministers, dividends have been recommended at 80% (2008: 80%) of the operating profit after Julie Beeby 20 2 22 income tax equivalents excluding the contributions from equity accounted Associates. John Goddard 34 3 37 Pursuant to the National Tax Equivalent Manual, Powerlink Queensland and its controlled entities are not required to maintain a Kenneth Howard 28 3 31 franking account. Christina Sutherland 31 3 34 Walter Threlfall 30 3 33 27 Key management personnel disclosures Total 196 19 215

(a) Directors Directors of Powerlink Queensland are appointed by the shareholding Ministers for a fixed term with specified expiry dates. 2008 Short Term Post- employment The following persons were directors of the Consolidated Entity during the financial year: Name Fixed Remuneration $’000 Superannuation $’000 Total $’000 (i) Chairman Else Shepherd 53 5 58 Else Shepherd John Goddard 36 3 39 Kenneth Howard 30 3 33 ( i i ) D i r e c t o r s Merv Norman 14 - 14 Julie Beeby John Goddard Christina Sutherland 34 3 37 Kenneth Howard Walter Threlfall 28 3 31 Christina Sutherland Total 195 17 212 Walter Threlfall.

(b) Other key management personnel Directors’ remuneration excludes insurance premiums paid by Powerlink Queensland in respect of the Directors’ and Officers’ The following positions had authority and responsibility for planning, directing and controlling the activities of the Consolidated Entity, liability insurance contracts, and premiums in respect of Directors’ and Officers’ supplementary legal expenses, as the contracts directly or indirectly, during the financial year: do not specify premiums paid in respect of individual Directors and Officers. Information relating to insurance contracts is set out in the Directors’ Report. Chief Executive (ii) Other key management personnel Chief Operating Officer Chief Financial Officer Details of the nature and amount of each major element of the remuneration to each of the other key management personnel, Human Resources and Development Manager. exclusive of performance payments are: (i) Remuneration of other key management personnel 2009 Short Term Post- employment The Remuneration Committee of the Board of Directors is responsible for establishing remuneration policy, and for determining Position Fixed Remuneration $’000 Superannuation# $’000 Total $’000 and reviewing the remuneration arrangements for other key management personnel. Chief Executive 453 77 530 The Remuneration Committee assesses the appropriateness of the nature and amount of compensation of key management personnel Chief Operating Officer 318 102 420 on a periodic basis by reference to relevant employment market conditions to assist the Company to attract, retain and motivate high Chief Financial Officer 255 43 298 calibre individuals. Shareholder guidelines and policy in relation to remuneration of key management personnel are followed. Human Resources and Development Manager 210 35 245 The remuneration arrangements include a total fixed remuneration component which provides some flexibility for packaging Total 1,236 257 1,493 of superannuation, motor vehicles and other costs, as well as a performance pay component which rewards out-performance of pre-agreed business and individual targets. Other key management personnel are employed under employment agreements. Their current employment agreements do not have 2008 Short Term Post- employment an expiry date. The agreements provide for a five (5) week notice period and provision for severance payment should the Company Name Fixed Remuneration $’000 Superannuation# $’000 Total $’000 elect to terminate the agreement. The severance payment is based on years of service and is capped at seventy-five (75) weeks of salary. Chief Executive 420 71 491 Chief Operating Officer 327 70 397 Chief Financial Officer 236 40 276 Human Resources and Development Manager 200 38 238 Total 1,183 219 1,402

# Includes both employee and employer superannuation contributions

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27 Key management personnel disclosures (continued) 30 Expenditure Commitments

Other key management personnel remuneration excludes insurance premiums paid by the parent entity in respect of Directors’ and (a) Capital Expenditure Commitments Officers’ liability insurance contracts and premiums in respect of Directors’ and Officers’ supplementary legal expenses, as the contracts Estimated capital expenditure contracted for at the reporting date but not recognised as liabilities is as follows: do not specify premiums paid in respect of individual Directors and Officers. Information relating to the insurance contracts is set out in the Directors’ Report. Consolidated Powerlink Queensland 2009 2008 2009 2008 (iii) Appointment Information - Directors $’000 $’000 $’000 $’000 (d) Director Term and Appointment Property, plant and equipment Else Shepherd Payable: Current Term - 3 years commencing October 2008 - First appointed September 1994 Not later than one year 207,412 67,106 207,412 67,106 Julie Beeby Later than one year but not later than five years 20,279 4,848 20,279 4,848 Current term - 3 years commencing October 2008 - First appointed October 2008 227,691 71,954 227,691 71,954

John Goddard (i) Non-cancellable operating leases Current Term - 3 years 3 months commencing July 2006 - First appointed July 2006 The Consolidated Entity leases property primarily for the placement of communication equipment. The leases are non-cancellable Kenneth Howard operating leases expiring within one to 26 years. The leases have varying terms, escalation clauses and renewal rights. Current Term - 2 years 9 months commencing January 2007 - First appointed January 2007 On renewal, the terms of the leases are renegotiated.

Christina Sutherland The Consolidated Entity provides the option of novated leases for its employees. These leases are non-cancellable operating leases expiring from one to five years. Current Term - 3 years commencing October 2008 - First appointed July 2001 Consolidated Powerlink Queensland Walter Threlfall 2009 2008 2009 2008 Current Term - 3 years 3 months commencing July 2006 - First appointed September 1994 $’000 $’000 $’000 $’000 Commitments for minimum lease payments in relation to non-cancellable operating leases are payable as follows: 28 Remuneration of auditors Not later than one year 1,869 1,164 1,869 1,164 Remuneration for audit or review of the financial statements of Powerlink Queensland or any entity of the Consolidated Entity. Later than one year but not later than five years 924 1,622 924 1,622 Amounts received or due and receivable by the auditors of Powerlink Queensland: Later than five years 445 445 445 445 Consolidated Powerlink Queensland 3,238 3,231 3,238 3,231 2009 2008 2009 2008 $’000 $’000 $’000 $’000 (ii) Other Queensland Audit Office Estimated expenditure contracted for at balance date but not provided for: Audit and review of financial reports 201 195 193 187 Consolidated Powerlink Queensland Non-audit services (Deloitte Touche Tohmatsu) 2009 2008 2009 2008 Consultancy services 20 - 20 - $’000 $’000 $’000 $’000 Commitments for expenditure contracted Total remuneration 221 195 213 187 for at balance date but not provided for:

Payable not later than one year - 10,094 - - The audit and review of the financial reports of the Consolidated Entity and Powerlink Queensland is conducted by Deloitte Touche Tohmatsu as Delegate of the Auditor-General of Queensland, Queensland Audit Office. Later than one year but not later than five years - - - - - 10,094 - -

29 Contingent Assets and Contingent Liabilities There were no known contingent assets or contingent liabilities of a material nature as at 30 June 2009 (2008:NIL).

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31 Related party transactions 31 Related party transactions (continued) Consolidated Powerlink Queensland (a) Parent entities 2009 2008 2009 2008 The parent entity within the Consolidated Entity is Powerlink Queensland. The ultimate Australian parent entity is the State $’000 $’000 $’000 $’000 of Queensland which at 30 June 2009 owned 100% (2008: 100%) of the issued ordinary shares of Powerlink Queensland. Interest revenue The Consolidated Entity has a related party relationship with its parent entity (includes other agencies and departments Parent Entity 3,664 6,448 3,153 5,740 of the State of Queensland), director related entities and Associates. Associates 14,003 12,959 - - (b) Directors 17,667 19,407 3,153 5,740 Director - Related Parties The Chairman of Powerlink Queensland, Else Shepherd, is also a Director of NEMMCO (now AEMO from 1 July 2009) - Consolidated Powerlink Queensland the company responsible for the operation of the National Electricity Market (NEM). Powerlink paid NEMMCO for services 2009 2008 2009 2008 associated with the operation of the NEM, and received money from NEMMCO for services associated with transmission $’000 $’000 $’000 $’000 network security and the electricity market. This directorship terminated on 30 June 2009. Other transactions Directors’ Shareholdings Dividends paid to ultimate Australian parent entity No shares in Powerlink Queensland were held by Directors of the Company, Consolidated Entity or their Director related entities. (State of Queensland) 84,412 92,606 84,412 92,606 Borrowing Costs - Parent Entity 178,713 146,611 178,713 146,611 Loans to Directors No loans have been made or are outstanding to Directors of the Company, Consolidated Entity or their Director related entities. 263,125 239,217 263,125 239,217

(c) Subsidiaries and Associates Interests in subsidiaries are set out in Note 32. (e) Outstanding balances arising from sales/purchases of goods and services The following balances are outstanding at the reporting date in relation to transactions with related parties: Interests in Associates are set out in Note 33.

(d) Transactions with related parties Consolidated Powerlink Queensland The following transactions occurred with related parties: 2009 2008 2009 2008 $’000 $’000 $’000 $’000 Consolidated Powerlink Queensland Current receivables (sales of goods and services) 2009 2008 2009 2008 $’000 $’000 $’000 $’000 Parent Entity 2,226 3,077 2,226 3,077 Sales of goods and services Associates 113 1,143 113 1,143 Parent Entity 625,814 577,735 625,814 577,735 Director Related 385 3 385 3 Associates 1,077 7,493 1,077 7,493 2,724 4,223 2,724 4,223 Director related entities 1,459 1,157 1,459 1,157 628,350 586,385 628,350 586,385 Current payables (purchases of goods) Parent Entity 1,358 158 1,358 158 Consolidated Powerlink Queensland Director Related 3 - 3 - 2009 2008 2009 2008 $’000 $’000 $’000 $’000 1,361 158 1,361 158 Purchases of goods Parent Entity 61,549 48,189 61,549 48,189 Associates 1,563 229 1,563 229 Director related entities 60 55 60 55 63,172 48,473 63,172 48,473

Consolidated Powerlink Queensland 2009 2008 2009 2008 $’000 $’000 $’000 $’000 Dividend revenue Subsidiaries - - 9,805 9,708 Associates 265 246 - - 265 246 9,805 9,708

120 powerlink annual report 2008/09 powerlink annual report 2008/09 121 Powerlink Queensland Powerlink Queensland notes to the financial statements notes to the financial statements

30 JUNE 2009 30 JUNE 2009

31 Related party transactions (continued) 33 Investments in Associates

(f) Loans to/from related parties (a) Carrying amounts Consolidated Powerlink Queensland Information relating to Associates is set out below. 2009 2008 2009 2008

$’000 $’000 $’000 $’000 Name of company Ownership Interest Consolidated Powerlink Queensland Loans to subsidiaries 2009 2008 2009 2008 2009 2008 Balance at the beginning of the year - - 62,954 62,954 % % $’000 $’000 $’000 $’000 Loans advanced - - 12,500 - Unlisted End of year - - 75,454 62,954 ElectraNet Pty Ltd 41.11 41.11 38,653 46,485 - - ElectraNet Transmission Services Pty Ltd 41.11 41.11 191 235 - - Consolidated Powerlink Queensland 38,844 46,720 - - 2009 2008 2009 2008

$’000 $’000 $’000 $’000 Consolidated Loans from ultimate parent entity 2009 2008 Balances at the beginning of the year 2,516,420 2,006,920 2,516,420 2,006,920 $’000 $’000 Loans advanced 522,000 509,500 522,000 509,500 (b) Movements in carrying amounts Interest charged 178,713 146,611 178,713 146,611 Carrying amount at the beginning of the financial year 46,720 25,227 Interest paid (178,713) (146,611) (178,713) (146,611) Share of profit/(loss) after income tax (2,073) (3,157) End of year 3,038,420 2,516,420 3,038,420 2,516,420 Reversal of dividends received/receivable (265) (246) Share of actuarial gain/(loss) in Defined Benefit Fund (4,193) 268 Share of increment on revaluation of property plant & equipment 25,420 No provisions for impairment of debts have been raised in relation to any outstanding balances, and no expense 8,479 has been recognised in respect of bad or doubtful debts due from related parties. Share of decrement of hedge reserve (12,632) (864)

(g) Terms and conditions Share in error for restatement of prior year balances 2,808 - All transactions were made on normal commercial terms and conditions, except there are no fixed terms for the Share in change in 2007 tax expense - 72 repayment of loans to wholly owned subsidiaries and loans from the ultimate parent entity (QTC loans). Outstanding balances Carrying amount at the end of the financial year 38,844 46,720 are unsecured and are repayable in cash. Loans to wholly owned subsidiaries are currently on an interest free basis.

(c) Share of Associates’ profits or losses 32 Subsidiaries Profit/(loss) before income tax (312) (3,326) Income tax expense (1,761) 169 The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the accounting policy described in Note 1(b): Profit after income tax (2,073) (3,157)

Name of entity Country of Class of Equity holding ** incorporation shares 2009 2008 % % Harold Street Holdings Pty Ltd * Australia Ordinary 100 100 Powerlink Transmission Services Pty Ltd * Australia Ordinary 100 100

* These subsidiaries have been granted relief from the necessity to prepare financial reports in accordance with Class Order 98/1418 issued by the Australian Securities and Investments Commission. ** The proportion of ownership interest is equal to the proportion of voting power held.

122 powerlink annual report 2008/09 powerlink annual report 2008/09 123 Powerlink Queensland Powerlink Queensland notes to the financial statements notes to the financial statements

30 JUNE 2009 30 JUNE 2009

33 Investments in Associates (continued) 35 Reconciliation of profit after income tax equivalent to net cash provided from operating activities (d) Summarised financial information of Associates Consolidated Powerlink Queensland The Consolidated Entity’s share of the results of its principal Associates and its aggregated assets (including goodwill) 2009 2008 2009 2008 and liabilities are as follows: $’000 $’000 $’000 $’000 Profit from continuing operations after income tax equivalent 121,872 103,133 122,890 105,418 Consolidated Entity’s share of: Depreciation 172,262 158,122 172,262 158,122 Ownership Interest Assets Liabilities Revenues Profit Net (gain)/loss on sale of non-current assets (3,316) (117 ) (3,316) (117 ) Share of (profit)/loss of Associates not % $’000 $’000 $’000 $’000 received as dividends or distributions 2,073 3,157 - - 2009 Dividends received from Associates 265 246 - - ElectraNet Pty Ltd 41.11 680,215 642,746 103,203 (2,260) Change in operating assets and liabilities ElectraNet Transmission Services Pty Ltd 41.11 10,762 10,571 64,361 187 (Increase)/Decrease debtors 13,391 (12,753) 13,731 (15,637) 690,977 653,317 167,564 (2,073) (Increase)/Decrease in inventories (3,896) (7,264) (3,896) (7,264) (Increase)/Decrease in prepayments (88) (5,435) (88) (5,435) 2008 (Increase)/Decrease in deferred tax assets (271) (306) (273) (306) ElectraNet Pty Ltd 41.11 625,556 580,252 84,782 (3,387) Increase/(Decrease) in creditors (47,998) (4,306) (47,991) 2,319 ElectraNet Transmission Services Pty Ltd 41.11 11,117 10,882 49,053 230 Increase/(Decrease) in provision for income taxes payable 7,865 (9,532) 7,763 ( 8 , 511) 636,673 591,134 133,835 (3,157) Increase/(Decrease) in deferred tax liabilities 1,710 815 2,175 783

All of the above Associates are incorporated in Australia. Increase/(Decrease) in other provisions 1,349 2,011 1,349 2,011 Net cash inflow (outflow) from operating activities 265,218 227,771 264,606 231,383 The Consolidated Entity’s proportion of voting power held in each Associate is the same as the ownership interest. The Consolidated Entity’s investments in the Associates are accounted for in accordance with the accounting policy described in Note 1(b)(ii). 36 Non-cash investing and financing activities Both Associates are proprietary companies, are incorporated in Australia and have 30 June reporting dates. No financing or investing activities were undertaken by the Consolidated Entity during the period which did not result in cash flows during this period. The Consolidated Entity’s investments in the Associates were not impaired during the year (2008: NIL). Consolidated 2009 2008 37 Settlements Residue (IRSR) $’000 $’000 Consolidated Powerlink Queensland (e) Share of Associates’ expenditure commitments, other than for the supply of inventories 2009 2008 2009 2008 Capital commitments 1,130 2,216 $’000 $’000 $’000 $’000 Finance Lease commitments - - Opening Balance 80,994 59,706 80,994 59,706 Operating Lease commitments 6,952 31,623 Residue transferred from NEMMCO 42,348 93,770 42,348 93,770 8,082 33,839 Interest Earned 80 1,961 80 1,961 Transfer to Powerlink Queensland - to offset network charges (104,798) (74,443) (104,798) (74,443)

(f) Contingent liabilities of Associates Balance at end of year 18,624 80,994 18,624 80,994 There were no known contingent liabilities of a significant nature as at 30 June 2009 (2008: NIL).

34 Events occurring after the reporting period No events have occurred subsequent to 30 June 2009 (2008: NIL) that materially affect the results disclosed in these financial statements.

124 powerlink annual report 2008/09 powerlink annual report 2008/09 125 Powerlink Queensland directors’ declaration independent auditor’s report

30 JUNE 2009 To the Members of Queensland Electricity Transmission Corporation Limited

In the opinion of the Directors of Queensland Electricity Transmission Corporation Limited (the “Company”): Report on the Financial Report An audit involves performing procedures In conducting the audit, the independence to obtain audit evidence about the amounts requirements of the Corporations Act 2001 (a) the financial statements and notes are in accordance with the Corporations Act 2001, including: I have audited the accompanying financial report of Queensland Electricity and disclosures in the financial report. have been complied with. (i) complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory The procedures selected depend on Transmission Corporation Limited, Auditor’s Opinion professional reporting requirements, and which comprises the balance sheet as at the auditor’s judgement, including the 30 June 2009, and the income statement, assessment of risks of material misstatement (a) In my opinion, the financial report of (ii) giving a true and fair view of the Company’s and Consolidated Entity’s financial position in the financial report, whether due to fraud Queensland Electricity Transmission as at 30 June 2009 and of their performance for the financial year ended on that date; and statement of recognised income and expenses and cash flow statement for the or error. In making those risk assessments, Corporation Limited is in accordance (b) there are reasonable grounds to believe that the Company will be able to pay its debts as and year ended on that date, a summary of the auditor considers internal controls with the Corporations Act 2001, including: when they become due and payable. significant accounting policies, other relevant to the entity’s preparation and (i) giving a true and fair view of the explanatory notes and the Directors’ fair presentation of the financial report in This declaration is made in accordance with a resolution of the directors. company’s and Consolidated Entity’s declaration of the Consolidated Entity order to design audit procedures that are financial position as at 30 June 2009 comprising the company and the entities appropriate in the circumstances, but not for and of their performance for the year it controlled at the year’s end or from time the purpose of expressing an opinion on ended on that date; and to time during the financial year. the effectiveness of the entity’s internal control. An audit also includes evaluating (ii) complying with Australian Accounting Director’s responsibility for the appropriateness of accounting policies Standards (including the Australian Else Shepherd the Financial Report and the reasonableness of accounting Accounting Interpretations) and the Chairman The Directors of the company are estimates made by the Directors, as well Corporations Regulations 2001. responsible for the preparation and fair as evaluating the overall presentation of presentation of the financial report in the financial report. Brisbane accordance with Australian Accounting I believe that the audit evidence obtained is Dated 27 August 2009 Standards (including the Australian Accounting sufficient and appropriate to provide a basis Interpretations) and the Corporations Act for my audit opinion. 2001. This responsibility includes establishing and maintaining internal controls relevant to Independence the preparation and fair presentation of the The Auditor-General Act 2009 promotes the financial report that is free from material independence of the Auditor-General and Carl Harris misstatement, whether due to fraud or QAO authorised auditors. The Auditor- error; selecting and applying appropriate (as Delegate of the Auditor-General of General is the auditor of all Queensland Queensland, Brisbane) accounting policies; and making accounting public sector entities and can only be estimates that are reasonable removed by Parliament. 27th August 2009 in the circumstances. The Auditor-General may conduct an Auditor’s responsibility audit in any way considered appropriate My responsibility to express an opinion on and is not subject to direction by any person the financial report based on the audit is about the way in which audit powers are to prescribed in the Auditor-General Act 2009. be exercised. The Auditor-General has for This Act, including transitional provisions, the purposes of conducting an audit, access came into operation on 1 July 2009 and to all documents and property and can replaces the previous requirements report to Parliament matters which in the contained in the Financial Administration Auditor-General’s opinion are significant. and Audit Act 1977. The audit was conducted in accordance with the Auditor-General of Queensland Auditing Standards, which incorporate the Australian Auditing Standards. These Auditing Standards require compliance with relevant ethical requirements relating to audit engagements and that the audit is planned and performed to obtain reasonable assurance whether the financial report is free from material misstatement.

126 powerlink annual report 2008/09 powerlink annual report 2008/09 127 Powerlink Queensland Powerlink Queensland statistical summary statistical summary

Transmission Lines and Underground Cables Circuit Breakers Added in 2008/09 Added in 2008/09

TRANSMISSION LINE UNDERGROUND CABLES LOCATION CIRCUIT BREAKERS Voltage Total Number Location Voltage Route Circuit Route Circuit km km km km 330kV 0 330kV 0 0 0 0 275kV 28 Abermain, Braemar, Greenbank, South Pine, Belmont, Woolooga, Nebo, Strathmore 275kV 213 427 0 0 Broadsound to Nebo, Tully to Innisfail 132kV 7 El Arish, Townsville East, South Pine 132kV 14 8 0 0 Townsville South to Townsville East, 110kV 0 Nebo to QR Bolingbroke 66kV 0 110kV 0 0 0 0 Total 35 66kV 0 0 0 0 Total 227 435 0 0 Capacitor Banks, Shunt Reactors and Static VAr Compensators Substation/Switching Stations and Transformers Added in 2008/2009 Added in 2008/09 CAPACITOR BANKS SHUNT REACTORS STATIC VAr LOCATION COMPENSATORS SUBSTATIONS TRANSFORMERS LOCATION Voltage Total Total Total Total Total Total Voltage Total Number Total Number Total Rating Number Rating Number Rating Number Rating MVA MVAr MVAr MVAr 330kV 0 1 1,500 330kV 0 0 0 0 0 0 275kV 1 7 2,200 South Pine, Abermain, Murarrie, 275kV 3 450 2 200 3 1,430 Greenbank, South Pine, Greenbank, Woolooga Woolooga, Strathmore, Nebo 132kV 3 0 146 Townsville East, QAL South, El Arish, Bolingbroke (four units removed) 132kV 1 50 0 0 0 0 Edmonton 110kV 0 0 0 Oakey, Mudgeeraba 110kV 2 100 0 0 0 0 South Pine Total 4 8 3,846 Total 6 610 2 200 3 1,430

Communication Sites Substation/Switching Stations Added in 2008/09 as at 30 June 2009

COMMUNICATIONS SITE SUBSTATIONS CABLE TRANSITION COMMUNICATION SITES Total Number Location Voltage Total Number Total Number 1 Mount Fox 330Kv 4 0 275kV 33 2

132kV 57 0 110kV 15 1 Total 109 3 91

128 powerlink annual report 2008/09 powerlink annual report 2008/09 129 Powerlink Queensland Powerlink Queensland statistical summary statistical summary

Transformers Five Year History of Transmission Lines and Underground Cables as at 30 June 2009 as at 30 June 2006

TRANSFORMERS (THREE-PHASE) 2009 2008 2007 2006 2005 Voltage Total Number Total Rating MVAr Voltage Route Circuit Route Circuit Route Circuit Route Circuit Route Circuit 330kV 5 4,975 km km km km km km km km km Km 275kV 68 17,250 132kV 83 5,177 TRANSMISSION LINES (AS CONSTRUCTED) 110kV 27 2,000 330kV 347 691 347 691 347 691 347 691 253 505 Total 183 29,402 275kV 5,548 7,495 5,335 7,068 5,227 6,852 5,179 6,669 5,151 6,641 132kV 2,816 4,488 2,802 4,480 2,651 4,151 2,623 3,961 2,623 3,961 Circuit Breakers 110kV 238 416 238 416 238 422 320 602 316 593 as at 30 June 2009 66kV 1 1 1 1 1 1 1 1 1 1 Total 8,950 13,091 8,723 12,656 8,464 12,117 8,470 11,924 8,438 11,887 Voltage Total Number Lines 330kV 28 275kV 399 UNDERGROUND CABLES 132kV 410 275kV 2 5 2 5 2 5 2 5 2 5 110kV 263 132kV 1 2 1 2 1 2 1 2 1 2 66kV 27 110kV 3 7 3 7 3 7 3 7 3 7

Total 1,127 66kV 1 1 1 1 1 1 1 1 1 1

Total 7 15 7 15 7 15 7 15 7 15 Cables Capacitor Banks, Shunt Reactors and Static VAr Compensators Total as at 30 June 2009 Lines & 8,957 13,106 8,730 12,671 8,471 12,132 8,477 11,939 8,445 11,902 Cables CAPACITOR BANKS SHUNT REACTORS STATIC VAr COMPENSATORS Voltage Total Number Total Rating Total Number Total Rating Total Number Total Rating MVAr MVAr MVAr 330kV 0 0 4 144 0 0 275kV 24 3,280 15 611 8 2,510 132kV 25 1,113 0 0 10 851 110kV 33 1,788 0 0 0 0 66kV 8 165 5 96 0 0 Total 90 6,346 24 851 18 3,361

130 powerlink annual report 2008/09 powerlink annual report 2008/09 131 index index

500 kilovolt network 2, 3, 11, 13, 28, 30, 40, 46, 48 L Landowners 13, 27, 30, 36, 42, 44, 46 Lockyer Valley Regional Council 49 A Aboriginal Cultural Heritage 40 Lost Time Injury Frequency Rate (LTIFR) 54 Annual Planning Report 2, 20 Low emissions 2, 13, 18, 64 Audit and Compliance Committee 52, 60, 61, 64, 65, 66, 70 Australian Energy Market 14 M Mount Stuart Power Station 14, 19 Australian Energy Market Commission (AEMC) 7, 14, 16 Australian Energy Market Operator (AEMO) 7, 14, 22, 70 N National Electricity Market (NEM) 2, 4, 7, 10, 14, 20, 28, 66, 68, 69, 70 Australian Energy Regulator (AER) 2, 4, 7, 8, 13, 14, 17, 23, 26, 69 National Electricity Market Management Company (NEMMCO) 14, 70 National Electricity Rules 4, 7, 14, 20, 28 B Board of Directors 58, 64, 71, 72 Braemar Power Station 13, 14, 19, 33 O Oil testing 4, 22, 67 Operational excellence 8, 52 C Cairns Regional Council 51 Capital works program 9, 10, 12, 13, 22, 23, 28, 38, 52, 69 P Pandemic 26, 52, 56 Climate change 2, 12, 13, 14, 17, 18, 27, 38 Project management 36, 68 Community Benefits Program 13, 46, 50, 51 Community Environment Fund 13, 46, 50 Q Queensland/New South Wales Interconnector (QNI) 30, 34, 56, 58 Corporate emergency response 26, 61, 62 Corporate entertainment and hospitality 63 R Remuneration 61, 62, 71, 72, 73 Remuneration Committee 60, 61, 64, 65, 72 Regulated Revenue 7, 8, 19 D Dalby Council 49 Regulatory Test 14, 28, 30, 37 Darling Downs Power Station 13, 14, 16, 17, 19, 33 Research 11, 27, 41, 64, 67 Development Program 38, 55, 56 Revenue determination 7 Dividends 60, 61, 70 S Safety 2, 3, 9, 13, 22, 24, 36, 51, 52, 54, 55, 56, 57, 61, 62, 65, 67 E Easements 27, 40, 42, 44, 46, 48, 68, 70 Safety Steering Committee 52, 62 ElectraNet SA 8, 66 Security Steering Committee 62 Electricity demand 2, 8, 10, 12, 13, 18, 19, 20, 22, 28, 30, 31, 32, 33 Shareholding Ministers 2, 58, 60, 61, 62, 66, 72 ENERGEX 7, 23, 33, 42, 65, 68 Somerset Regional Council 48 Environmental incident 38 South Burnett Regional Council 49 Environmental management 2, 11, 13, 42, 45, 61 Sponsorship 46, 51 Environmental Steering Committee 38, 62, 71 Statement of Corporate Intent 9, 61, 63

Ergon Energy 7, 26 Sulphur hexafluoride gas (SF6) 41 Executive Leadership Team 61, 66, 67, 68, 69 System security 7, 22, 34, 70 Excellence Awards 56 T Telecommunications 11, 24, 25, 27, 41, 64, 67 G Generation mix 12, 13, 16, 18 Thuringowa City Council 50 Goodwill programs 13, 46, 48 Townsville City Council 50, 51 Greenhouse Challenge Plus 40 Toowoomba Regional Council 48 Greening Lockyer 11, 13, 46, 49, 50 Training and development 38, 55, 56, 62 Greenworks 2, 11, 46, 48, 49, 51 TransGrid 30 Grid Australia 2, 12, 14, 16, 17, 66 Transmission Network Service Provider (TNSP) 3, 8, 14, 18, 24, 40 Transmission pricing 19 I Ipswich City Council 48 International Transmission Operation and Maintenance Study (ITOMS) 18 W Weed management 44 Western Sub-Regional Organisation of Councils (WESROC) 49 Whitsunday Regional Council 51

132 powerlink annual report 2008/09 powerlink annual report 2008/09 133 glossary of terms and abbreviations glossary of terms and abbreviations

TERMS OF MEASUREMENT AASB Australian Accounting Standards Board Interest cover EBIT/gross interest expense ROA Return on Total Assets

ACCC Australian Competition and Consumer IRSR Intra Regional Settlements Residue Rules National Electricity Rules Gigabit a measure of storage capacity and data Commission transfer. One gigabit = 1 billion bits LTC Lost Time Calculation SCI Statement of Corporate Intent AEMC Australian Energy Market Commission Gigabits per Unit of data transfer rate

MRET Mandatory Renewable Energy Target SF6 Sulphur Hexafluoride gas second AEMO Australian Energy Market Operator NEM National Electricity Market SPEC Sustainable Procurement Gigawatt (GW) One gigawatt = 1,000 megawatts AER Australian Energy Regulator Energy Committee or 1,000 million watts NEMMCO National Electricity Market AIFRS Australian equivalents to International Management Company Sponsorship Involves a contribution by Powerlink to Gigawatt hour One gigawatt hour = 1,000 megawatt Financial Reporting Standards an organisation or activity that meets our (GWh) hours or one million kilowatt hours NGER Act National Greenhouse and Energy sponsorship policy requirements ARPANSA Australian Radiation Protection and Report Act 2007 kL Kilolitre. One kilolitre = 1,000 litres Nuclear Safety Agency Statewide peak The peak power (in MW) delivered from NPAT Net Profit After Tax summer electricity Powerlink’s network during summer. Kilovolt (kV) One kilovolt = 1,000 volts (a volt is a unit ASX Australian Stock Exchange demand This demand is corrected to the four of potential or electrical pressure) NTNDP National Transmission Network (as delivered to 50 percent probability of exceedence CHMA Cultural Heritage Development Plan customers) reference temperatures in Queensland Kilowatt (kW) One kilowatt = 1,000 watts (a watt is a Management Agreement unit of electrical power or the rate of Operating The Operating Agreement is the Statewide peak The peak power (in MW) as generated doing work) CPRS Carbon Pollution Reduction Scheme Agreement agreement between Powerlink and summer electricity by Queensland power stations and NEMMCO which establishes Powerlink demand including interconnector flows in Kilowatt hour The standard unit of energy representing Debt/Fixed Assets Debt to as the System Operator under the (as generated) Queensland during summer (kWh) consumption of electrical energy at the rate Fixed Assets National Electricity Rules. The Agreement of one kilowatt over a period of one hour defines the geographical areas for direct Static VAr A Static VAr Compensator (or SVC) DWDM Dense Wave Distributed Multiplexing and indirect oversight for operational Compensator is a specialised part of a substation m Million control. The Agreement also defines the that provides fast-acting reactive power EBIT Earnings Before Interest and Tax extent to which NEMMCO’s powers compensation to control such issues Megawatt (MW) One megawatt = 1,000 kilowatts or one million watts EBITDA Earning Before Interest, Tax, have been delegated to Powerlink as uneven loads and voltage regulation on high voltage electricity Depreciation and Amortisation Megawatt hour One megawatt hour = 1,000 kilowatt hours OpsWAN Operations Wide Area Network transmission networks (MWh) EIS Environmental Impact Statement OPGW Optical fibre ground wire TFR Total Fixed Remuneration System minute One system minute = a measure of EMF Electric and Magnetic Field QNI Queensland/New South Wales TNSP Transmission Network Service Provider energy not supplied during transmission disturbances. One system minute is GOC Government Owned Corporation Interconnector the amount of energy that would be Queensland Treasury Corporation Goodwill proactive, community-based projects QTC transported during one minute at the programs that aim to build relationships with system maximum demand Regulatory Test The Regulatory Test, promulgated by Local Government, communities and the AER under the National Electricity key stakeholders in strategic areas Rules, requires TNSPs to identify the traversed by existing or future Powerlink solution that maximises the net benefit transmission infrastructure to the NEM when addressing emerging Grid The high voltage electricity network limitations transmission network Return on Assets Earnings before interest and tax Grid Australia The organisation that represents and after abnormals (EBIT)/average electricity transmission network owners total assets

GST Goods and Services Tax Return on Equity Operating profit after income tax/average total equity

134 powerlink annual report 2008/09 powerlink annual report 2008/09 135 acknowledgements

Inside Back Oakey Substation connection, near Oakey Cover (left)

Featured Powerlink employees Cover John Burgess, Field Test Engineering Officer Page 6 Jai Dalton, Transmission Linesperson Daniel Stacey, Transmission Linesperson Grant Howlett, Transmission Linesperson Page 9 Cassandra Bevan, Manager Employee Relations Page 19 Daniel Andersen, Pricing and Customer Advisor Page 27 Lyndall Josey, Manager Protection Design Page 31 & Russell Lenoy, Trade Technician Back Cover Page 33 Gerard Reiter, Manager Projects Page 37 Brian Rodham, Team Leader - Substation and Telecommunication Construction Management Page 45 Sarah Tuckett, Environmental Officer – Sustainability and Climate Change Page 51 Kahlia Martin, Workplace Health and Safety Advisor Page 57 Luke Faria, Field Test Engineering Officer Page 75 Kaila Callaghan, Engineering Projects Officer Inside Back John Anderson, Substation Works Control Manager Cover

Thank you to all of the Powerlink people who contributed to the preparation of this Annual Report.

Design Lumino www.lumino.com.au

Photography Peter Budd www.peterbudd.com.au Board of Directors; Executive Leadership Team; featured Powerlink employees; & page 25 Production notes: Michael Cranfield Stock used in this report is acid free to ensure long archival life, and is an www.michaelcranfield.com Pages 21, 29, 33 & 74 environmentally responsible paper manufactured using Elemental Chlorine Free (ECF) pulp sourced from certified, well managed forests. This stock is Marc Grimwade Forest Stewardship Council (FSC) Chain of Custody (CoC) certified www.marcgrimwade.com.au Pages 42, 43 & 49 (mixed sources).

Peter Robey www.prphoto.com.au Inside Front Cover; Inside Back Cover; & pages 15, 17, 18, 22, 34, 35 & 59

Dean Whitling www.dwphoto.com.au Pages 2, 5, 26, 27, 37, 39, 41, 44, 47, 51, 53, 56 & 57 Powerlink Queensland ABN 82 078 849 233 PO Box 1193 Virginia Telephone: (07) 3860 2111 33 Harold Street Virginia Queensland 4014 Facsimile: (07) 3860 2100 Queensland 4014 Australia Australia www.powerlink.com.au