WA Premier Colin Barnett says he is confident of raising at least $11 billion to repair the state's beleaguered finances under plans to privatise the Western Power poles and wires utility.
The divisive issue is shaping as one of the most important of the March state election, given the Labor opposition has guaranteed it will not sell the electricity transmission and distribution company.
If the Liberal National government is re-elected - it has trailed Labor in recent polls - it will sell 51 per cent of the business, keeping the rest in state hands.
Western Power would be floated on the share market, with 31 per cent offered to Australian industry superannuation funds and 20 per cent to "mum and dad" retail investors.
The $11 billion figure implies Western Power is worth at least $21 billion to $22 billion, well above past valuations such as a PwC report last month estimating a $12 billion to $16 million total value.
Mr Barnett and Treasurer Mike Nahan said their higher price was based on the prices paid for similar assets such as the Ausgrid and Transgrid NSW sales and their discussions with the banks involved.
"It is going to be a significant amount of money, the $11 billion estimate is probably fair ... it is a conservative estimate," Mr Barnett told reporters.
Superannuation funds were "queuing up to buy these assets", Mr Nahan said, given utilities were considered defensive, reliable investments.
The majority of the money - $8 billion - will be used to wipe out Western Power's debt making a decent dent in current government debt of $28 billion that is forecast to grow to $40 billion.
However there was a risk for the WA government in using proceeds from asset sales to pay down debt, as it had been unpopular with voters in Queensland, RBC Capital Markets strategist Michael Turner said in a note to clients.
Of the other $3 billion, $1 billion would be spent on ageing schools, $1 billion on public transport and other transport infrastructure and $150 million on improving electricity supplies in more remote areas, which helped secure WA Nationals' leader Brendon Grylls' support.
"The level of borrowings was getting uncomfortably high ... this makes our finances manageable," Mr Barnett said, arguing that WA's debt had only soared because it's share of national GST revenue had fallen so low.
Labor leader Mark McGowan said selling Western Power would push up prices, drive down services, lose revenue and jobs.
"Mr Grylls and Mr Barnett are financial and economic cowboys. They have wrecked the state's finances, they have delivered us the highest unemployment in the nation and now they plan to flog off the family silver."
Mr Barnett said there was no downside for West Australians because money would now be freed up for infrastructure for a growing population.
The prices Western Power charges - which he said represented 40 per cent of residents' power bills - would not rise sharply because that, along with maintenance, safety and investment issues, were all still highly regulated.
There would also be no forced redundancies at Western Power, Dr Nahan said.
Notre Dame University adjunct professor of politics Peter Kennedy said the issue would be crucial to the election result, with Mr Barnett banking on the past successful floats in WA of Bankwest and Alinta.
