By Terence Mills
There is something very strange going on with power pricing in Australia, particularly so in the states where privatisation of distribution and generation has occurred. Whilst the federal government have no ongoing energy policy for Australia you have probably noticed Turnbull laying in to the power chiefs, demanding that they turn up at meetings in Canberra where he lets them know in no uncertain terms that he, on our behalf, is not happy and he calls on them to let their customers know when they are coming off specially discounted deals. This much heralded concession evidently means that the big distributors will write a letter to their customers: big deal!
Then he demands that the head of AGL come to Canberra and he tears strips off him and says that he can’t close the Liddell power station in 2022 despite AGL having given the government over five years notice. Now he has AGL on a ninety day deadline to come up with an energy policy beyond 2022.
All very strange stuff coming from a government who are absolutely committed to avoiding having an energy policy largely because they would then have to take ownership of the problem, something they desperately don’t want to do as they see much greater mileage in blaming Labor for all their problems. Indeed, it seems that a major plank of the coalition’s re-election campaign for 2019 is based on calling people names, particularly Blackout Bill Shorten and having at least a couple of power blackouts over the summer, ideally in the Labor states of South Australia and Victoria.
Reading the Weekend Australian today – it’s an old habit I have dating back to 1964 – Caroline Overington has an article about the crushing pressure particularly on pensioners of energy bills. She mentions Turnbull’s suggestion that we all phone our power companies and demand a better deal and that’s exactly what she did evidently. She called Origin and instantly got a 30 per cent discount. Well, good on her you may say but if she was being overcharged to the extent of 30 per cent then surely there is a case for the ACCC to step in and prosecute these guys: this is money gouging and demands that government regulate pricing for what is an essential commodity.
Rather than a coordinated energy policy sensibly allocating a future role for a mix of LNG, Solar, Wind, coal, pumped hydro and the like we seem to have a Prime Minister running around the country announcing a feasibility study for Snowy 2.0 which should be published (or not published if it comes up with the wrong numbers) by the end of the year. Then, of course, there will need to be funding for the project which presumably will come from the existing stakeholders. The commonwealth is a minority shareholder in the Snowy Hydro, with a 13% stake. New South Wales and Victoria have 58% and 29% stakes respectively. So, unless Turnbull takes on the total cost on behalf of the Commonwealth or buys out the states, there will have to be some serious talking with the other stakeholders once the feasibility study is done and costings worked out.
Then we find Turnbull in Townsville telling the LNP faithful that he will fund a coal-fired power station in North Queensland using clean coal technology that has yet to be developed and funding it from the North Australian Infrastructure Facility even though it doesn’t meet NAIF criteria.
Surely we deserve better policy formulation than this random finger in the dam approach? The CEO of Alinta Gas summed up the prevailing situation on energy policy in Australia when he likened it to: playing a game of football with invisible goalposts: we don’t know what it is we are shooting for.
Where I live in Queensland electricity generation and distribution are still in public hands and despite the Abbott asset recycling scheme which had been embraced by the Newman LNP government the people of Queensland were not impressed and quickly despatched Newman and his henchmen after just one term. Looking at my most recent electricity bill from my monopoly publicly owned electricity distributor there are no special offers, no discount periods not even a free set of steak knives. Just a straight forward bill telling me what I have used, what I am being charged per kilowatt hour consumed, divided between two essential tariffs. The main tariff is for continuous power charged at 25.890 cents per kwh and the off-peak tariff used for pool pumps and in our case over night water heating charged at 20.482 cents per kwh plus GST in both cases. So, whilst we have the energy distribution companies in those states that have privatised this essential service playing silly buggers with opaque pricing, slick marketing and plans that are designed to confuse and mislead consumers, in Queensland we still have a straight forward and transparent pricing system.
I have no idea how my power charges in Queensland compare with those in other parts of Australia – although I would be interested in feedback from AIMN readers – but I do take comfort from the fact that as a voter I still have some control over the supply and pricing of this essential service and the ballot box is after all a blunt and persuasive taskmaster that always helps focus the attention of politicians.