Many Australians are paying more than they need to for their electricity, it has been revealed this week.
To try to help consumers get the best deal, the Federal Government is moving to encourage electricity retailers to be more open with their pricing and billing practices.
Perhaps the Government ought to consider asking the same of the Greens, and other voices in the debate doing their best to blame all and ignore the best long-term, sustainable remedies.
As we have said this week, a good way to bring down East Coast energy prices over time would be to unlock the plentiful reserves of natural gas which are being locked underground by State Governments more inclined to bow to noisy enviro-political pressure than to listen closely for the voice of a quieter – but bigger – consumer constituency.
In the USA, without any Government intervention (by Democrats or Republicans), power prices have been pushed firmly down by increased use of natural gas – and carbon emissions have fallen as well.
Back in Australia, the Greens want the Government to get more involved – to take over the market and freeze prices. Anyone thinking this will deliver more investment needs to look much more closely at the history of business and economics here and overseas.
More investment is exactly what is needed, in order to increase reliable affordable energy supply. Gas provides the best answer because it is greener than coal and much more reliable than wind and solar. It is also able to be ‘switched on and off’ more readily than other forms of baseload electricity generation.
It is this combination of affordability, reliability and fewer emissions on which the Government appears intent.
On ABC radio yesterday (Thursday), Treasurer Scott Morrison said it was time for environmental ideology to be put aside in favour of practical solutions.
“I’ve been very careful to remove theology and any other ‘ology’ out of this debate,” Mr Morrison said.
“The Government is focused on the engineering and the economics when it comes to this and getting the right answer.”
Attorney-General and Government Leader in the Senate, George Brandis, told Parliament this week that the Finkel report into Australia’s energy needs had an emphasis on reliability and affordability.
“In approaching the Finkel report, and in approaching the appropriate policy choices and policy responses to this problem, this Government will be guided by pragmatism,” Senator Brandis said.
“We will be guided by engineering; we will be guided by the facts. One thing that we will not be guided by is ideology.”
The comments by Mr Morrison and Senator Brandis appeared directed at the Greens calls for a return to Government-controlled power utilities.
Victorian Greens MP Adam Bandt issued a media statement yesterday saying that renewable energy should be the focus of policy because it was “driving prices down”.
However, in an accompanying table in the same media statement, South Australia stands out as the State with by far the highest retail prices for electricity – and it is the State with by far the biggest penetration of renewable energy.
SA is also the State with the biggest problem with reliability of supply, having had Australia’s only ever total blackout last year and a number of ‘brown outs’ since then which have cut electricity supply for tens of thousands of homes and caused major concern for manufacturers in the State who have warned of business closures and loss of thousands of jobs if reliability is not restored.
And as we have explained here, gas-fired power has continued to be an important part of the electricity supply reliability picture in SA.
Getting back to electricity prices, NSW is top of the list for affordable power – and it is the State with the lowest penetration of renewable energy.
According to Mr Bandt, the Australian Capital Territory has lower prices. However, his comparison rests on what he calls the “average standing offer”. Analysis by the Australia Energy Market Commission, which looks at the prices actually paid, finds that Australian Capital Territory citizens pay less, on average, than do ACT residents.
And the only reason the ACT is in the ballpark is because of its relatively low population and its close proximity to Snowy Hydro and other taxpayer subsidised wind and solar projects.