Privatisation of energy produces no benefits for consumers

PRIVATISATION of energy markets had produced no benefits for consumers, and created "large fiscal losses to the public", according to a Queensland academic.

The economist has called for critical energy infrastructure to be returned to public hands, saying the privatisation of electricity networks had been a failure across Australia.

Professor John Quiggin, a laureate fellow at the University of Queensland, reviewed energy sector privatisation and the related process of electricity market reform between the early 1990s and now.

Despite movements by both the Queensland and New South Wales governments towards electricity privatisations, Prof Quiggin found not long terms for government or consumers.

His report, funded by the Victorian branch of the Electrical Trades Union, found electricity prices were highest in privatised states, and had "risen sharply" since the introduction of the National Electricity Market.

The research showed many of the claimed benefits of privatisation have not been supported, including a massive jump in complaints to the energy ombudsman in privatised states, from 500 to more than 50,000 a year.

It also revealed resources were moved away from operating power networks to management and marketing, and promised increases to investment efficiency had not occurred.

Prof Quiggin said after 20 years of privatisation, "it is evident to everyone" that the electricity reforms begun in the 1990s had not delivered the promised outcomes.

"Privatisation, corporatisation and the creation of electricity markets were supposed to give consumers lower prices and more choice, to promote efficiency and the reliability in the electricity network and to drive better investment decisions for new generation and improved transmission and distribution networks," he said.

"None of these promises have been delivered. Prices have risen dramatically.

"Consumer choice has meant the removal of the secure low-cost supply consumers previously enjoyed and its replacement with a bewildering array of offers, all at costs inflated by the huge expansion in marketing and managerial costs."

Prof Quiggin argued that "in the face of this record of failure", reformers have claimed the only option was to push on with more privatisations.

He said such arguments were "baseless", and privatisation of energy markets had produced no benefits for consumers, and created "large fiscal losses to the public".

Tragic ride-on mower death

Premium Content Tragic ride-on mower death

FORENSIC officers attended a Northern Rivers property after family found a man dead...

Northern Rivers ideal for a ‘hydrogen cluster’ says RDA

Premium Content Northern Rivers ideal for a ‘hydrogen cluster’ says RDA

RDA Northern Rivers is calling on local businesses to partner in a potential green...