australian energy price rises

The Greatest Government Failure in Australia’s History

Do you remember the 1980s?

Back then, government promised that deregulation and the privatisation of power companies would result in lower prices. Not only that, but we’d get more efficient and reliable delivery too.

We don’t need to tell you that the opposite has proven true. These days, energy policy is not only in a crisis; it’s a catastrophe.

ALP governments across Australia have long been at the centre of the push for electricity privatisation. Yet Federal Opposition Leader Bill Shorten appears to have a short memory.

He told the ABC radio’s Sabra Lane:

There’s no doubt that privatisation has been a big problem. Now it’s very hard to wind back the clock. What we do need to do is go and get on and end the blame game.’

Building power poles and stringing wire has long been seen as an opportunity by power companies to earn a premium for upgraded infrastructure. As a consequence, these costs have accounted for the largest of the price rises in Australia. 41%, according to the ACCC (Australian Competition and Consumer Commission).

Recently, Energy Infrastructure Investments, operators of the MurrayLink interconnector, were ordered by the Australian Energy Regulator to subtract $7 million of unnecessary costs from a proposed upgrade. The costs would have been borne entirely by South Australian residents.

Rod Simms, Chairman of the ACCC, told the National Press Club:

The largest increases in electricity prices over the last decade have not been matched at all by increases in other prices or wages.

There are many cases of firms facing a doubling or even tripling in electricity prices in their most recent offers over the last 12-24 months.

One retail grocer with multiple sites saw in increase of over 50% in their monthly bill, even after taking many energy efficiency measures.

Clearly, there is an ongoing pattern of price gouging. Simms said:

People are using less electricity; indeed, the price for consumers in cents per kWh has, on average, increased 62%’.

The chairman of the ACCC also levelled criticism at ‘green’ power:

The cost of green schemes is not transparent; they do cost consumers, often inequitably as those with solar panels are being subsidised by those who do not have them.’

Mr Simms concluded his talk to the National Press Club with a warning:

We know we have an energy affordability problem and we have some things we can do to help address it. Some steps will be controversial. But the consequences of not acting are dire for many Australians.’

Duncan Wade

Duncan Wade

Duncan Wade has been working in the publishing and newspaper industry for 30 years. During that time, he has worked for numerous publications, mostly in regional areas. He has an interest in the big issues, the economy, politics and defence. Duncan believes that Australians have been extraordinarily lucky over the years, but there are some serious challenges on the horizon. He is a father of three girls, lives in a regional area and previously a tragic of his beloved Lions — the Fitzroy Football Club.

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