by dedja » Wed Aug 15, 2012 11:51 am
As someone who has worked in the power industry, I can hopefully add some context to the discussion.
The current regulated national energy market was instigated by the Keating government, with bodies set up to govern and operate the market, now known as the Australian Energy Regular (AER) and Australian Energy Market Operator (AEMO).
The state government up until that time had massively under invested in preventative and asset maintenance of their respective power assets, instead using the 'profits' to supplement general revenue. This is also true of other utilities, such as gas and water.
The idea was that a regulated market would attract the appropriate commercial investment to maintain and operate power assets on a national level, whilst at the same time breaking the 'conflict of interest' nexus of the states.
Some states sold (or in SA's case, 199 year leases!) the power assets whilst others (NSW) kept them in state ownership.
The AER is supposed to set energy pricing for participants and ensure adherence to legislation. It is statutory body wholly financed by the Commonwealth.
AEMO manages the energy operators and systems.
In spite of all this, the participants (generation, transmission, distribution, retail) all price gauge to ensure maximum return the their investors. The AER has been a wet sponge and basically rubber stamps the funding requests of the participants.
Part of this price gauging has been the 'future proofing' of participants against the (then) introduction of the carbon tax. The impact of the carbon tax has been incorporated into the power supply chain way before it became law this year.
So the large price increases we all see have been a product of past lack of investment by the states, price gauging by the participants, indirect and direct effect of the carbon tax.
Whilst the federal government may on the face it be correct in stating that the states are largely to blame for the majority of the price increases, it is in fact the federal government who are largely to blame for:
1. setting up the regulatory market that now operates
2. creating and funding a piss weak regular to govern the market
3. fostering an inflationary environment indirectly through carbon tax speculation and directly by the carbon tax
The end result of this mess is that we as consumers pay for the federal and state governments mistakes ... unless you have installed solar (like I have) in which the non-solar consumers are being screwed again to subsidise the solar rebates and feed in tariffs.
What a fine mess indeed!
Dunno, I’m just an idiot.
I’m only the administrator of the estate of dedja