Energy Policy – Oz Style

Writing for another state sponsored publication, Tim Colebatch, formerly of Fairfax, comments on Why gas prices went sky-high, and what governments need to do about it.  BTW, the state sponsored publication is Inside Story, produced by the Institute for Social Research at Swinburne University of Technology.  From Fairfax to Inside Story eh.

Colebatch details an interesting perspective on Australia’s current energy “issues” and he seamlessly moves from gas to electricity to energy policy in general.  He also makes some rather “interesting” observations including:

That (Victoria’s gas policy) was a protectionist policy. Like many (though not all) protectionist policies, it mostly worked well.

When the free marketeers won control of the policy levers, they sold off state energy companies, and allowed prices to be set by the market, at world parity levels. Not because the public was demanding that; quite the opposite. Australian voters, then and now, wanted their power and gas supplies to be under public ownership.

The electricity and gas sectors are now mostly privatised, and are dominated by monopolies and oligopolies which – even while formally regulated, or competing in open markets – have the means to effectively set their own domestic prices. And we consumers and downstream businesses are paying dearly for it.

There were several other “interesting” observations in Colebatch’s article, but for the above, Colebatch failed to provide any evidence that Victoria’s protectionist policy worked well, but more to the point that it worked better than would have a non protectionist policy.  Colebatch also failed to provide any evidence as to voter preference around “power and gas supply” ownership or public ownership of these assets relative to other uses of government capital.  But who needs evidence to support such assertions.

Most interestingly, having earlier said that gas prices were set by international markets, he suggests that energy companies set their own prices.  He also fails to note that retail energy prices are set by regulators.

But this is the corker:

The electricity industry is waiting for the government to produce an energy policy that explains how it will meet its commitment to drive down greenhouse gas emissions by 2030 to 26 to 28 per cent below 2005 levels.

Having complained about the rising cost of electricity and the damage caused to the manufacturing sector, Colebatch refers to the Government’s “commitment to drive down greenhouse gas emissions by 2030 to 26 to 28 per cent below 2005 levels“, a commitment that is designed to increase the price of energy.

The real energy policy question is why Australia has committed to ” drive down greenhouse gas emissions by 2030 to 26 to 28 per cent below 2005 levels” in the first place.

Assuming carbon emissions can be and are accurately measured, and are measured using the same methodologies in all countries, what is the benefit of of Australia making such a commitment?  Australia’s emissions account for, perhaps, 1.3% of global emissions.

Assuming no change to Australia’s emissions, given the ongoing industrialisation in India, China and Africa, this ratio will decline naturally anyway.  And even if Australia stopped emitting entirely, the impact on global emissions would be irrelevant.

Can someone explain why it is bi-partisan policy for Australia to commit economic suicide?  Why, why, why?

Is this something to do with social licences or social justice?

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21 Responses to Energy Policy – Oz Style

  1. A Lurker

    Can someone explain why it is bi-partisan policy for Australia to commit economic suicide? Why, why, why?

    Because wealthy, white, Western nations have to be punished for being wealthy, white and Western.

  2. J.H.

    “Is this something to do with social licences or social justice?”

    No it’s about power and about funding and maintaining the permanent Government of the Bureaucrats. It doesn’t need to make sense, it only needs to disempower the people and redistribute huge amounts of money to the State.

    This is the problem with having a “Deep State” of unelected Bureaucrats who maintain a Permanent system that our Elected representatives are subservient to.

    Especially when those elected representatives are cronies of the Bureaucracy themselves and form a Single Party body Politic that pretends to be a Two Party System. A political system that pretends to present choices and differences where none actually exist.

    Our society has become more about the ambitions of the Deep State’s Bureaucrats and its crony political class, instead of its citizens enterprise and aspirations….. That is where the social contract has been abused. They have empowered themselves when they were never meant to have that authority.

    Add a compliant media led by a billion dollar State funded media propagandist…… and you have Australian society.

    That’s my two cents on it…

  3. Art Vandelay

    Colebatch is a fine example of the Australian media’s long-standing tradition of appointing people to the role of Economic Editor who have absolutely no understanding of economics.

  4. Jannie

    Fools motivated by a contradictory ideology, empowered by the tools of State, and funded by debt their grandchildren are expected to repay. Its not going to end well.

  5. the sting

    Is it because we are governed by city based wimps ?

  6. Roger

    Can someone explain why it is bi-partisan policy for Australia to commit economic suicide? Why, why, why?

    Because our politicians are idiots/treasonous – take your pick depending on how consciously complicit you believe they are in the Green-Socialist plan to de-industrialise Australia based on the AGW scare.

  7. candy

    Well, it’s nice to think of state owned electricity supply again, of affordable rates and plentiful supply.

    A dream, but too late. The worst thing is, coal is considered evil and there’s no going backwards to cheap energy. What a scam this is.

    Malcolm Turnbull had a big chance to stand up for coal mines and insist on it. But the hydro thing is about supporting solar and wind and he’s being praised for being “green” and giving coal the flick.

  8. Ubique

    Never fall into the trap of arguing about a reduction in GHG emissions. These are supposedly only the means to the objective that dares-not-speak-its-name of reducing the world’s average temperature. We can spend billions, drive the entire country into penury for absolutely diddly squat effect on temperatures, even when calculated with the warmists’ own conversion factor.

  9. Fools motivated by a contradictory ideology, empowered by the tools of State, and funded by debt their grandchildren are expected to repay. Its not going to end well.

    grandchildren? there is going to be grandchildren plural? Lucky to be a single grandchild.

  10. Simon/Other

    Because all governments get lazy and just decide to appropriate energy to control the masses. Soon you wont be able to fish and shoot in national parks or keep the water that falls on your property or gain access to city markets without paying a toll or get a government job unless you went to the right school or university. Nah it just sounds like Ancien regime days.

    “Louis XVI was too well intentioned not to try to remedy abuses which have shocked him. But he possessed neither the character nor the talents to control an impetuous nation, in a situation which cried out for reform. His reign was a succession of feeble attempts at doing good, shows of weakness and clear evidence of his inadequacy as a ruler.”

    We have arrived!

  11. RobK

    I think you have it Simon and Unique.

  12. Megan

    The madness of crowds. Especially when the crowds have no education in basic economics and get all their learning from TV and the newspapers.

  13. Muddy

    Can someone explain why

    Because there is no money/fame/social standing in actually SOLVING a problem. The key lies in proclaiming you have a solution to a problem (real or imagined) and then doing everything possible to NOT solve the same, using a variety of tactics (other people are getting in the way, the problem is bigger than first thought, you were on your way to solving it but then it morphed into another problem, etc.). If there isn’t a ‘problem’ to be solved, then you (indirectly) create one, or convince others that a non-problem is really a problem, by redefining words and concepts. In short, it’s all a ‘make work’ (make money) scheme, with issues such as inequality, gerbil worming, aggressive-moustache-intimidation, blah blah blah, being simply a means to an end.

  14. RobK

    Andrew Probyn explains how the price going down has made the price go up.
    There must be something in the water at the ABC. The term “free market” is a mystery to them.

  15. RexR

    He also fails to note that retail energy prices are set by regulators.

    False and misleading Spartacus.

    The AER does not have a role in setting retail energy prices. In some states and territories, the government remains responsible for control of the energy prices customers see on their bills. For example, in Queensland, the ACT and Tasmania, you can ask for a contract with a regulated electricity price where the price is set by government. Regulated prices for gas are only available in New South Wales. In Victoria and South Australia, there are no regulated offers or tariffs (for electricity or gas), which means that energy retailers set all of their own prices.

  16. mem

    The green energy spruikers know how to push all the right buttons to get people such as Weatherill and Turnbull excited about Green energy. They now have both of them on a platter under extreme pressure and totally out of their depths. Shorten is skulking in the background smelling some form of carnage ahead.That’s what he is good at, cleaning up road kill.

  17. john constantine

    Follow their money.

    When economic suicide for the proles in the outer economy transfers massive wealth to the Grim Reaper aristocracy of their crony inner economy, the proles are stuffed.

    Mass importation of unskilled tennant herds to stretch out the housing cycle is economic suicide for the proles, but transfers massive wealth to their inner economy.

    Their inner economy has suicided the prole economy to the point that the obsolete and deplorable proles cannot afford to breed, house themselves in their own homes, park their own cars or take electricity for granted.

    The proles are to be deindustrialised, dewesternised, defertilised, disenfranchised, disabled, disavowed, bemused, befuddled, bewitched and bewildered.

    Suicide is optional, but legislated for and encouraged.

  18. Andrew Deakin

    Tim Colebatch’s commentary on energy matters while at The Age was notable for its economic illiteracy, and lack of understanding of the most elementary facts about the electricity and gas supply industries. A comparably ignorant approach was a feature of Michael West’s energy reports and analysis at the SMH, before he was delisted as part of Fairfax’s cost savings strategies. Why did Fairfax employ journalists so lacking in expertise in their reporting sectors? Their reports were an embarrassment to those working in the industry, while gleefully received in the universities and energy NGOs.

  19. Jannie

    grandchildren? there is going to be grandchildren plural? Lucky to be a single grandchild.


    They are spending other peoples’ grandchild’s money.

  20. IRFM

    In the US the market has solved the problem of supply. The blighters now produce too much natural gas and are exporting into our own markets. They have driven the cost of domestic US energy across all sectors down to such an extent that all of the US’s competitors have been taken out of play. Petrol at US$ 0.78 per gallon (not a litre) . How good is that. Now that is what a free market is all about.

  21. Boambee John

    We are well on the way to Soviet style socialism, we already have our Nomenklatura.

    All we need now is the Gulag.

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