The South Australian government is standing by its decision to reject an offer from Alinta Energy to keep a local coal-fired power station running for another three years for a $24 million payment.
The move has been slammed by the SA Liberals and federal Energy Minister Josh Frydenberg, who says it has exposed Jay Weatherill as "the premier with no clothes" given the offer was cheaper than his energy plan.
But Mr Weatherill says it did not make sense to accept the offer that would not have guaranteed Alinta's northern power station would have remained operational.
A letter released by the SA Liberals on Wednesday revealed Alinta Energy told the state government in May 2015 it could keep the station at Port Augusta running until mid-2018 for a subsidy of about $24 million.
Opposition Leader Steven Marshall says the government's decision to refuse the offer, reflected in the power station's closure in May 2016, was "economically damaging" and boosted SA power bills by 10 per cent.
His criticism has been backed by Mr Frydenberg, just weeks after he traded insults with Mr Weatherill at an Adelaide event.
Mr Frydenberg says Mr Weatherill has repeatedly denied keeping the Port Augusta power station open would have been cheaper than the $550 million energy strategy he announced this month.
But he said the premier has now been proven wrong, with the offer revealed to be "22 times cheaper than his $550 million admission of failure".
"Today Jay Weatherill was exposed as the premier with no clothes," he told reporters in Canberra.
Mr Weatherill defended the decision on Wednesday, telling reporters the subsidy would not have guaranteed the Northern Power Station would stay on.
"What we were being asked to do is to throw taxpayers' money at an old coal-fired power station with no guarantee it would stay open for any period of time," he told reporters.
"Coal and Northern represented the past and it just did not make sense to be investing in something that no private company could make viable."
Earlier, SA Energy Minister Tom Koutsantonis said accepting the offer also would have run the risk of other power companies asking for similar payments.
He said the government would still have needed its energy plan, which includes a new gas-fired power station and battery storage for renewable energy, given this week's closure of the Hazelwood power station in Victoria.
