The sale of Aurora's retail arm was called off because the government could not achieve a "fair and reasonable price."
Energy Minister Bryan Green told parliament in a ministerial statement yesterday that the government decided to call off the sale of Aurora's customer base because it was advised on Friday that it was unlikely to be able to meet its sale requirements.
"In particular, I have been advised by treasury that the price is unlikely to be fair and reasonable," he said.
Mr Green said the sale difficulties were largely caused by a softening in the national electricity market.
"We still support the sale of the retail business, but will only be prepared to do so when conditions are more favorable," he said.
The impact of the failed sale on Aurora staff are as yet unknown.
Mr Green's statement followed an emergency cabinet meeting this morning, to government's decision to abandon the retail sale process yesterday.
The government closed the sale room yesterday after the opposition claimed in Parliament that potential buyers had walked away.
The opposition has alleged the collapsed sale process would result in higher electricity prices.
Opposition energy spokesman Matthew Groom pressed Mr Green in question time on whether a the government or Aurora had applied to the energy regulator to pass-though the $50 million cost of getting to this stage of the energy reforms on to customers.
Mr Green said the Tasmanian Energy Regulator may review its recommendation on power prices, but he said Tasmanian power prices would still drop by at least 5.23% on January one and customers would still have access to full retail contestability in July next year, as announced in March.
The opposition supported the energy reform process, and Mr Green said they knew that meant passing through some costs on full retail contestability.
Premier Lara Giddings denied the collapse was a failure of government.
"The reality is what we have done is put an asset out to the market, and we have tested the market," Ms Giddings said.
"The market has not been able to provide us with what we felt was a reasonable price and we have withdrawn it."