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Alinta makes an offer to buy AGL's Liddell


Alinta Energy has made an offer to buy AGL's Liddell power station in the NSW Hunter Valley.

The energy retailer had previously expressed a desire to buy the plant and extend its life beyond 2022, when AGL plans to mothball it.

"We can confirm Alinta Energy has ... submitted a non-binding offer for the Liddell power station to AGL, which we believe represents a compelling commercial proposition for AGL shareholders," an Alinta spokesman told AAP on Monday.

"We won't be in a position to comment further until AGL has considered the offer and responded."

The details of the bid are confidential but a price tag of around $1 billion has been previously floated.

The Turnbull government is keen for the station to remain open beyond its slated 2022 closure and has been lobbying AGL to accept a sale.

Federal Energy Minister Josh Frydenberg welcomed the news Alinta has put forward an offer.

"It's important that AGL gives proper consideration to the offer, given Alinta's stated intention to continue operating the plant beyond 2022," he told AAP.

"The government is concerned about the impact on the reliability and affordability of our energy system should Liddell close in 2022."

Mr Frydenberg said while AGL's investments in a new 250MW gas peaking plant and 100MW upgrade of Bayswater were welcome, they weren't enough to fill the gap left by the closure of Liddell.