Evidence Based Policy

The evidence is that policy has caused Australia to have the highest electricity prices in the world.  Bring on the green jobs!

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27 Responses to Evidence Based Policy

  1. Jack

    Read the sophistry over at SMH on this topic. No mention of RET or so called clean energy subsidies that have driven the price rises. The post-truth world of the SMH has this to say on South Australia:

    “So far the move to clean energy has done little to lower the world-topping electricity prices in South Australia”.

  2. Dr Faustus

    These values appear to be based on a 2015 IEA report.

    The 2017 position may be much worse.

    Current AGL SA residential standing offer: A$0.418/kWh (plus $333/pa supply charge)
    Current UKPower top tariff: A$0.221/kWh (plus $145/pa supply charge)

    Residential power in SA is currently 89% more expensive than the most expensive UK residential tariff – the chart above suggests only 50%.

    No doubt Elon Musk will turn all that around…

  3. Ƶĩppʯ (ȊꞪꞨV)

    Nothing commies enjoy more than grinding down the proletariat.

  4. Good thing I kept grandmas old kerosene lamps.

  5. Up The Workers!

    We should be fronting up to the Electorate Office of every wallet-stuffing, carpet-bagging crook of an A.L.P./Green pollie and demanding that THEY hand over the cash to pay these extortionately inflated bills with.

    It used to be the case that crooks and thieves had to pay reparations to those whom their crooked actions ripped off. It is about time that we went back to such a system.

    As long as there are zero repercussions for the thieves and incompetents who are artificially forcing up power costs while simultaneously making them less reliable and robust, and vandalising existing generating infrastructure, the same crimes will continue.

  6. Tator

    Dr Faustus,
    have just done a manual comparison on the SA market as looking at changing.
    Cheapest rate after all discounts is still 35.112 cents a kwh. Along with the same supply charge.
    So even at those rates it is still 59% more expensive than the UKs top rate.

  7. Irreversible

    Policy has most certainly caused this: in particular an appalling error in the regulation of transmission assets that drove very heavy over-investment and related costs and the pathetic lack of attention to gas markets that has seen supply so tight that large contract prices rose 400% in a few years and available gas virtually disappeared. Then came the entirely predictable retirement of very old power stations, which will continue, and now we have an almost certain gap in capacity investment while all the shouting prevents decisions on actual policy.

  8. Barry 1963

    Abbott said once the carbon tax was gone power prices would go down! Not true.

  9. Bruce of Newcastle

    Policy has most certainly caused this: in particular an appalling error in the regulation of transmission assets that drove very heavy over-investment and related costs

    Most of the “over-investment” was actually driven by the engineering requirements of the stupid solar policies inflicted on the generators and distributors. A large number of power pole transformers weren’t built to operate in reverse, especially on sunny days when a lot of solar was fed back up the grid. You will have seen the big new ugly galvanized transformers on power poles – several in my suburb. Billions of bucks worth. Voltages in some streets were exceeding the Australian standard such that consumer goods were in danger of burning out.

    and the pathetic lack of attention to gas markets that has seen supply so tight that large contract prices rose 400% in a few years and available gas virtually disappeared.

    All too much attention. Bans on exploration and development, Green activism of Lock The Gate and in the Pilliga, increased threat of royalties. But mostly the bans. As Gottleibsen in the Oz on the weekend says in his column several companies were ready to go with gas resources in Gippsland, but were smashed first by the Libs then by Andrews. They’ve given up and walked away. All because of the stupid global warming policies and craven politicians.

    Then came the entirely predictable retirement of very old power stations, which will continue

    A furphy. Their lives could be extended fairly easily. The cost that AGL was complaining about re Liddell was less per MWh produced than that for a new coal fired power station. I checked. A plant I used to work at had a section of it which was a century old. It was kept going because it had to operate but the cost benefit wasn’t there to rebuild it or change to a different process. Extending the life of plants is almost always cheaper than building new ones.

    and now we have an almost certain gap in capacity investment while all the shouting prevents decisions on actual policy.

    Yes, I agree with that. They should ditch their stupid ideology and build baseload capacity immediately. Not gas either. Importing LNG from Qatar is geopolitically stupid, and monstering the Queensland exporters is exactly the opposite of good policy. Sovereign risk WACC factors would skyrocket and no projects would get done ever. Nor should they when there’s a risk they will be stolen by the government by fiat.

  10. BoyfromTottenham

    Bruce, I generally agree, but the economics of baseload power has been totally trashed by (i) the huge subsidy (about 170% of the wholesale electricity price) that the LRET provides to ‘renewables’ and (ii) the requirement that retailers give preference to ‘renewables’ power ahead of base load. So IMO unless the LRET is fixed (i.e. repealed), any new baseload power (even if owned by the federal or state government) will also be uneconomic. So this has nothing to do with power station efficiency, or ageing infrastructure, or gas prices – its just about the LRET, probably the most pernicious, treacherous, anti-business piece of legislation this country has very inflicted on itself. Why the hell cannot the pollies understand this – even the Turnbull Libs?

  11. Andrew

    Abbott said once the carbon tax was gone power prices would go down! Not true.

    They did. They fell 9%. Mathematically, that’s been overwhelmed by the other policy fuckups that have doubled wholesale prices but what A666 promised, happpened.

  12. Yohan

    No comparison of power prices among countries takes into account the supply charges. But its not surprising to see us 2.5x more than the UK.

  13. Speedbox

    What an appalling indictment of this nation’s political class. To think that just a decade ago, Australia had some of the cheapest energy on the planet.

    Wait till summer and the rolling blackouts hit. Then, to add insult to injury, whopping power bills arrive in March/April 2018.

  14. billie

    but but, isn’t this exactly how the plan is meant to work?

    increase the cost of energy so you use less and thus save the planet

    I don’t understand what the problem is

    energy is clearly too cheap, and so the cost of it is increased astronomically til you stop using it

    at some point, renewable energy becomes cheap by comparison and everything is good

    the point is though, the politicians and media are making a mess of this by trying to compensate for exactly the effect they are trying to achieve

    they need to harden up and see it through, or fold, not do both like they are now

  15. Dr Faustus

    Tator: I was indeed looking at the most expensive current retail offering in each market.

    To compare apples with apples then, the cheapest UKPower offering is 12.376p – or ~A$0.2089/kWh.
    So the takeaway is that a diligent search by an informed and commercially-motivated SA consumer delivers a 68% higher price than an on-the-fly UK internet offering.

  16. Shine a Light

    It looks like Eon Mask tepresents the “Last chance Saloon” and that there is no contigency plan.
    Hopefully the people of SA will not suffer.

  17. H B Bear

    Hopefully the people of SA will not suffer.

    Democracy. Good and hard.

  18. Tim Neilson

    Hopefully the people of SA will not suffer.

    I suppose it’s too much to hope for that the 47% who voted for Weatherdill will bear all the inevitable suffering and the other 53% will miraculously escape?
    Not that voting for the Coalition is in itself a praiseworthy act, but at least the 53% really don’t bear direct responsibility.

  19. Boyfromtottenham;

    So this has nothing to do with power station efficiency, or ageing infrastructure, or gas prices – its just about the LRET, probably the most pernicious, treacherous, anti-business piece of legislation this country has very inflicted on itself. Why the hell cannot the pollies understand this – even the Turnbull Libs?

    But they do understand it.
    I’ll bet they were all in on the ground floor when all this stuff was starting up.

  20. Entropy

    Andrew
    #2516353, posted on October 6, 2017 at 2:38 pm

    Abbott said once the carbon tax was gone power prices would go down! Not true.

    They did. They fell 9%. Mathematically, that’s been overwhelmed by the other policy fuckups that have doubled wholesale prices but what A666 promised, happpened.

    Indeed. At this point also contemplate what the projected carbon tax was to be by now, and then contemplate what impact that would have had on current prices and reliability of supply. Abbott saved us that at least, but the job was only just started, and now sadly eroded by subsequent bad policies.

  21. Dr Fred Lenin

    Heads should roll for this u,n,communist scam being perpetrated on the long sufferi g Australian taxpayer . We need to go through the alleged elite Iike a dose of salts ,clearing the filth of socialist/ gangrene/ u.n communists , the western civilised world has been relegated to third world status because of these scum ,shoot the lot of them ,prison is too good for them ,they might corrupt the inmates .

  22. Boambee John

    When John Howard’s brother was tied up in a company making good money from ethanol for fuel, the media was (rightly for once) all over it like a rash.

    Turnbull’s son or son in law is tied up with renewables (windmills iirc) and the response is “Ho hum”.

    Them again the media could not get enough of Hewson’s ex wife when he was Leader of the Opposition, but is remarkably uninterested in Shorten’s ex.

  23. John Constantine

    If only their julie bishop can sign enough crushing and irreversibly binding capitulation documents when she is in europe, there will come a tipping point where she simply doesn’t have to go back to the racist settler outpost at the arse end of the world that she despises beyond any sane hatred.

    They will let her stay in her little bought and paid for slice of socialist heaven.

    Whole country sold out for a few party favours from the beautiful people.

    What was the policy position that was so important bishop had to leak and tear down a government to achieve?. Was it truly so she could fly off and spend as much as she wanted and sign what she felt like?

    Worlds dearest electricity and the worlds cheapest quisling traitors.

    Can’t have the one without the other, Comrades.

  24. Jack
    #2516188, posted on October 6, 2017 at 11:52 am
    Read the sophistry over at SMH on this topic. No mention of RET or so called clean energy subsidies that have driven the price rises. The post-truth world of the SMH has this to say on South Australia:

    “So far the move to clean energy has done little to lower the world-topping electricity prices in South Australia”.

    That really does sum up the stratospheric level of stupidity involved in the whole CAGW/renooballs fiasco. It takes a determinedly applied degree of idiocy to speak that sentence with a (presumably) straight face and heartfelt belief. No wonder we’re going down the S-bend faster than an airliner flush.

  25. amortiser

    Abbott said once the carbon tax was gone prices would go down. not true!!

    When coal fired generators have to pay $85 a mwh to wind and solar generators for the privilege of being second in line for supply no wonder prices are spiralling. Those renewable energy certificates are a carbon tax by any other name. I’m sure few people are aware of this detail. They all think that the cost of renewables is falling below conventional generation. This hidden subsidy makes all the difference and is what is driving coal fired power stations out of business.

    If the power generators were gouging the system why are coal fired generators shutting down? There is no transparency in this balls up.

  26. Nerblnob

    During the recent oil price boom, I was told by an experienced engineer colleague with a supplementary background in economic analysis of energy markets, that, if you removed all taxes from hydrocarbons and subsidies from “renewables” , oil would have to reach $2000 a bbl before renewables would compete.

    If that’s true, it means the money pit is virtually bottomless – and still lame ducks like wind and solar can’t walk unassisted for long.

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