This article looks at the history of electricity generation, the reasons why governments’ were intimately involved in it and the reasons why they chose to exit the industry and create the godawful mess we have today.
I fully expect to be vilified by the free market aficionados but I am old enough not to bother about name calling and think that the facts always point to the truth even though they are often difficult to find. My example is the state of SA although there are parallels with Victoria and probably other states.
Reliable cheap energy has always been a major driver of industrialisation and it still is today. This point seems to be lost on those who implement policies that raise prices, reduce reliability and cause industries to close their doors and lay off employees.
South Australia started off with a private supplier of electricity, The Adelaide Electric Supply Company, (AESCo), who provided electricity in the metropolitan area of Adelaide. They saw no reason to make large investments which might have long delays before getting a return so the chances of luring industry to SA with cheap and abundant energy were slim.
Premier Tom Playford had an agenda to industrialise SA and looking back he was very successful in doing this. It is hard to imagine that the busted arse place we have become was once a fairly vibrant economy producing cars, cotton fabrics, television sets and whitegoods as well as steel making, ship building and oil refining. The demise of many of these things was the advance of “developing” countries where cheap labour priced the domestic products out of the market, (Japanese TV sets for example), and what was not killed off by that was squandered by the idiots that followed after Playford ended his career after 36 years as Premier.
Playford “nationalised” the electricity industry, (with the enthusiastic support of the then Labor opposition), and formed ETSA which had the charter to expand the capacity and coverage of the electricity grid, ensure reliable power and keep prices as low as possible. In association with the Housing Trust which provided cheap land, factories and housing for workers and the Engineering and Water Supply Department that ensured water supply and sewerage facilities and with a pragmatic approach that reduced bureaucracy the results were impressive.
Capital works were funded with public debt. ETSA consistently covered debt repayments and provided an annual dividend to government coffers. The organisation was driven by engineering with forward plans to build power plants that would cater for future growth in a manner where there were no power shortfalls. Incidentally, people I know from that era tell me the SA/VIC interconnector was built to take excess power from Loy Yang when power growth in Victoria stalled. This saw the cancellation of the next power station on the books. Those who knew the traps occasionally took time out from their lawn mowing rounds to try and raise the alarm but were ignored. The same happened when reservations about “renewable energy” were raised. Silence.
It seems fashionable to believe that ETSA was “sold” for reasons of inefficiency but that is not so. The Bannon Labor government’s insane “State Bank” fiasco, where 2 small banks were merged,(but someone forgot to remove the government guarantee), put under the control of a department store manager and eventually crashed and burnt as the experiment in “Merchant banking” failed miserably. It left a large debt, “guaranteed by the government”, which needed to be repaid and there was no money in the till. It was the time of the “economic rationalists” and the “user pays” principle so the obvious source of the cash was to sell some family silver. ETSA was first to go. There are parallels with the fate of the SECV in Victoria in the aftermath of their state bank’s Tricontinental disaster and the collapse of the Pyramid Building Society.
18 years have passed and we are still in the grip of idiots. No one “in power” seems to have the slightest idea of the damage that has been caused by chucking taxpayers money at the “renewables” carpetbaggers so they can build useless wind farms, large scale solar farms, batteries and the fantastic Snowy 2.0 and then having us pay them for the privilege of ruining the economy. People clap when good power stations are destroyed and we are plunged into chaos. The stupid focus on “climate change”, “emissions reductions” and the vilifying of coal is insane and needs to be fought with all our might.
Many years ago I learnt the difference between efficiency and effectiveness. Effectiveness is “doing the right thing”; efficiency is “doing the right thing as well as possible given the situation that applies”. Someone could be the most efficient producer of button up boots but it would not be effective. No one wants them.
People seem to be afraid to voice an opinion lest they be branded a socialist or a communist or some other epithet but I could not care less. If I am any “ist” it would be a realist.
In a previous post on Catallaxy I saw the following:
It’s not that those who forget history get to repeat it, but those who do not learn from history end up being led around in chains.
That is where we are today and where I fear we will stay unless there is a rush of “common sense” to the head. The “leaders” of both sides of politics need to recognise the error of their ways and understand that what they fervently wish for is not achievable. What are the chances?