The council at an extraordinary meeting on Thursday night withdrew its in-principle support for the project and announced it would not sell land near Kew to International Power Australia (IPA).

Administrator Dick Persson told IPA group manager corporate affairs Jim Kouts about the council’s decision on Thursday night.

Mr Kouts said on Friday the company was extremely disappointed and surprised at the decision.

On Friday, the Department of Planning had yet to formally receive notification of the council’s withdrawal of landowner’s consent for the proposed power station.

“However, the NSW government cannot determine this proposal if landowner’s consent is withdrawn therefore the proposal could not proceed,” a department spokesman said.

IPA wants to build a power plant, just north of Kew, to run during periods of peak energy demand.

A statutory declaration from the council in November 2006 gave in-principle support for the proposed power station.

But Mr Persson said there was no council resolution to sell the land to IPA.

He said the power plant proposal had no benefit to our community.

“I do think it’s a poor proposal ... it’s old technology,” he said. “If they want to come back to us with a proposal for renewable energy, we would be quite interested in talking with them.”

IPA would not have taken the proposal to this level if it didn’t have the support of the council, Mr Kouts said.

“As far as we are concerned we have acted in good faith,” he said.

The company lodged the proposal with the NSW Planning Department in late 2006 and the environmental assessment went on public exhibition for comment in late April.

The exhibition period has been extended to June 20.

Mr Kouts said the company had incurred costs of seven figures to get the proposal to this point.

IPA is now looking at its options and those options include legal action against the council.

“As far as we are concerned the process remains alive,” Mr Kouts said.