After 25 years, it is clearer than ever that privatisation of electricity in Australia has been a disaster for people and the planet.
In the early 1990s, prior to privatisation, energy prices in Australia were some of the lowest in the world and had been dropping for decades. That trend was sharply reversed following privatisation. Today, households are paying skyrocketing prices and growing numbers of Australians are now living in “energy poverty”.
The recent report by the (pro-market) Australian Competition and Consumer Commission has revealed that in the past decade alone, residential electricity consumers have faced a real increase of 35% in their bills and a price increase of about 56% in real terms.
So it is no wonder that in a recent Guardian Essential poll, 63% of respondents agreed that privately owned power companies should be returned to public ownership.
Jeremy Corbyn has put renationalisation back on the agenda in Britain. Last year, a poll conducted by a conservative think-tank revealed that more than three-quarters of people in Britain now favour the public ownership of water (83%), electricity (77%), gas (77%) and railways (76%).
In Australia, the demand of renationalisation is not one you will find coming from the leadership of the Australian Labor Party.
The Electrical Trades Union (ETU) in Victoria has been campaigning for renationalisation of the electricity sector for a number of years and has taken a lead in this area. The ETU (Vic) campaign “Privatisation isn’t working” makes the point: “A privatised power market [is] never going to satisfy our social need for affordable energy. The question isn't how to regulate, it's whether we should own and run it for common good.”
In 2014, the union commissioned an independent report by University of Queensland researcher Dr John Quiggan into electricity privatisation. The report found that electricity privatisation in Australia had delivered higher prices, a rise in customer complaints, a decline in reliability, higher costs and worse service and recommended renationalisation of the electricity grid.
The early ’90s were a time when concepts such as the “greenhouse effect” and “global warming”, were starting to be seriously discussed internationally — the Rio Earth Summit was held in 1992. At just the time when a publicly owned and controlled energy sector could have made a head start in responding to climate change, Australian state governments were embarking on a program of corporatisation and eventual full privatisation of the energy sector.
The Bob Hawke–Paul Keating Labor governments embarked on neoliberal economic reform in the early 1990s and adopted a national competition policy in 1995, the same year Keating launched the National Energy Market. This policy drove the privatisation agenda. Keating’s national competition policy aimed “to promote and maintain competitive forces to increase efficiency and community welfare, while recognising other social goals”.
But history has shown that community welfare and social goals have been sacrificed in the name of competition in the electricity sector, as they have in healthcare, education and — as the Royal Commission has shown — in the banking sector.
Successive Australian governments have wasted decades on market solutions for lowering electricity prices, addressing climate change and remedying the many other ills caused by the neoliberal economic agenda.
Bipartisan pressure to maintain coal in the “mix” of fuels for the generation of electricity is holding us back from the transition needed to 100% renewable energy generation and supply. While there is still a market for coal, Labor and the Coalition are happy to keep promoting it.
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