Energy Minister Eric Ripper said the plan could no longer progress after the Liberal and Green parties reversed their support for state energy reform plans.

"After supporting the creation of a regional power utility in November last year, the Opposition have broken their word," Ripper said.

"The Government's planned reforms to Western Power were designed to increase investment, jobs and economic growth in Western Australia," he said.

"They would also have resulted in a regional power corporation dedicated to delivering reliable and affordable electricity to WA households and businesses not connected to the main South-West power grid.

"For the first time, regional customers would have had their own energy utility, based in a regional centre, and with regional customers getting undivided attention.

"But as a result of the Liberals' actions, regional power interests will now have to struggle for attention inside the Perth-based Western Power bureaucracy."

Yesterday the National Competition Council (NCC) threatened to impose multi-million dollar penalties on WA for failing to introduce energy reform after the opposition and the Greens withdrew support for the Western Power break-up legislation.

The power crisis has now turned into a leading election topic with both parties pointing the finger on past administrations, although little in the way of a solution has been promoted by either side.

Prior to last years Collie Power Station failure Western Power said it might defer the construction of a new $350 million power plant in the south west as there is a number of smaller generators planned for construction over the next few years.

The company's alternate plan was to work on extending the life of the current generators beyond their planned retirement date.

Following last years opening of the Cockburn Power Station the next major commitment is the planned 260 MW Kemerton station, which will supply Western Power under a 25 year power purchase contract.

Although designed to supply power at times of peak demand the station is sure to deliver a regular supply to the undermanned WA electricity market, which will push the value of the contract to around $320 million at today's prices.

Construction costs are estimated to be around $250 million with funding to be provided by non-recourse project finance. Construction work is expected to commence early this year and will include two gas turbines, new sub-station works and gas lateral connection to the Damper to Bunbury natural gas pipeline. Completion and operation date are planned for October 2005 in time for the summer peak demand period in Western Australia.

Now the generating power is there, we just need the gas to run it.