Company News Summary
ERM Power Announces LGC Fulfilment Plan for 2016
Original announcement: ERM Power announces LGC Fulfilment Plan for 2016
ERM Power announced that it would meet its obligations under the Large-scale Generation Certificate (LGC) Scheme through a combination of surrendering certificates and paying the Clean Energy Regulator (CER) $123m for calendar 2016. Due to market and pricing conditions and within the Scheme design, it has elected to pay the shortfall charge in lieu of surrendering 1.9m LGCs. As advised in June 2016, the market price for LGCs has more than doubled and traded up toward $90 per certificate during FY2017 versus the non-tax deductible shortfall charge of $65 per certificate. By electing to pay the shortfall charge of $65 per certificate in place of surrendering 1.9m LGCs. The impact is an incremental tax charge of $37m which is recognised at 31 December 2016.
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