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Terribly Socialist, but why do we need retailers ? If governments bought them out they could sell power a lot cheaper without factoring in a profit
The future of energy generation and storage
- Thread starter Value Collector
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Then a politician would be responsible for the outcome, we can't have that, they never went into politics for that.
They go into politics to form committees and look at the big picture, not do anything about it.
In W.A the Govt still runs the electricity supply, I expect there will be a slow change over to renewables, with no speed bumps.
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Check out the history of power generation to answer that question.
Initial electricity generation was by private enterprise. So sure enough wealthy areas how power - but not poorer areas.
Power sources ran at multiple voltages . It was a dogs breakfast.
Government finally had to step in to establish ground rules for energy supply and often establish direct of indirect electricity generation to ensure the effective electrification of society and industry.
State Electricity Commission of Victoria - Wikipedia
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If Albo is as Left as some say he is he may consider a takeover of some sort or maybe greater regulation.Then a politician would be responsible for the outcome, we can't have that, they never went into politics for that.
They go into politics to form committees and look at the big picture, not do anything about it.
In W.A the Govt still runs the electricity supply, I expect there will be a slow change over to renewables, with no speed bumps.
It was the LNP that forced the sale of electricity assets, completely stuffing up a working system of State owned generation, distribution and retailing with consequent price increases.
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That's true and I've never agreed with it, but the States did get good prices for them.
I bet the private operators, wish they had never bought them.
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Biggest problem is the market structure and operation itself not who owns what.
Two practical examples:
1. The Australian Gas Light Company, better known as AGL, founded 1837 and for most of its existence a monopoly gas supplier to much of Sydney. The company has always been shareholder owned, not government.
In 2022 AGL still exists but no longer has monopoly status anywhere and no longer owns the physical gas network in Sydney, although it does now own other physical assets such as power stations.
2. The Hydro-Electric Corporation, universally referred to in Tasmania as simply "the Hydro", founded 1914 and through to 1998 a vertically integrated monopoly electricity generator, network operator and retailer in Tasmania. It has always been technically 100% government owned, though at arms length in practice.
In 2022 the Hydro still exists but no longer has monopoly status anywhere, indeed it's actually banned from retailing in Tasmania (except on the Bass Strait islands) hence the existence of Aurora Energy as a government owned retailer, and operates in a competitive market so far as generation is concerned. It does retail in other states under the brand name Momentum Energy.
Now the thing is, if we look at the modern incarnations of both well then it says rather a lot.
In 2022 AGL charges more for gas in Sydney, operating in a competitive market, than it previously charged as a monopoly.
In 2022 Aurora Energy, a state government owned retailer operating in Tasmania in what's now a competitive market alongside others, charges about 20% more in real terms than the monopoly Hydro charged in 1991.
So my contention is that the problem isn't private / shareholder versus government ownership, both have successfully operated in the past, but rather the nature of the market itself which adds very real inefficiencies and costs no matter who owns any given generator, network or retailer. Government or private, both have the same issue there.
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Biggest problem is the market structure and operation itself not who owns what.
Two practical examples:
1. The Australian Gas Light Company, better known as AGL, founded 1837 and for most of its existence a monopoly gas supplier to much of Sydney. The company has always been shareholder owned, not government.
In 2022 AGL still exists but no longer has monopoly status anywhere and no longer owns the physical gas network in Sydney, although it does now own other physical assets such as power stations.
2. The Hydro-Electric Corporation, universally referred to in Tasmania as simply "the Hydro", founded 1914 and through to 1998 a vertically integrated monopoly electricity generator, network operator and retailer in Tasmania. It has always been technically 100% government owned, though at arms length in practice.
In 2022 the Hydro still exists but no longer has monopoly status anywhere, indeed it's actually banned from retailing in Tasmania (except on the Bass Strait islands) hence the existence of Aurora Energy as a government owned retailer, and operates in a competitive market so far as generation is concerned. It does retail in other states under the brand name Momentum Energy.
Now the thing is, if we look at the modern incarnations of both well then it says rather a lot.
In 2022 AGL charges more for gas in Sydney, operating in a competitive market, than it previously charged as a monopoly.
In 2022 Aurora Energy, a state government owned retailer operating in Tasmania in what's now a competitive market alongside others, charges about 20% more in real terms than the monopoly Hydro charged in 1991.
So my contention is that the problem isn't private / shareholder versus government ownership, both have successfully operated in the past, but rather the nature of the market itself which adds very real inefficiencies and costs no matter who owns any given generator, network or retailer. Government or private, both have the same issue there.
Well then, I guess the question is how can the market be restructured to iron out the inefficiencies to result in a more orderly system capable of delivering power at a reasonable cost to the consumer ?
The example I think of is the separation of functions from the State owned utilities, ie generation , distribution and retailing were sold off to different people who all wanted to make a profit, rather them all being done by one entity which could cross subsidise among the functions to keep prices down. Prices had to rise under this model.
This restructure only seems to have made the market more complex and inefficient and was a ideological blunder imo.
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A dilemma for Labor on the energy front.
www.abc.net.au
What happens when a gas-led recovery collides with a climate election?
We answer your questions by looking at where Scott Morrison's gas-fired recovery was supposed to start, in the Northern Territory's Beetaloo Basin.
www.abc.net.au
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A bit of trivia.Check out the history of power generation to answer that question.
Initial electricity generation was by private enterprise. So sure enough wealthy areas how power - but not poorer areas.
Power sources ran at multiple voltages . It was a dogs breakfast.
Government finally had to step in to establish ground rules for energy supply and often establish direct of indirect electricity generation to ensure the effective electrification of society and industry.
State Electricity Commission of Victoria - Wikipedia
en.wikipedia.org
In Western Australia it was only relatively recently (approx early 1970's), that the State Government SEC, took over the operation of the country towns electricity systems 'Country Undertakings', later called 'Regional Power Stations' ,then 'Horizon' took over responsibility from the Town councils.
Here is a bit of a brief summary of W.A's power system development, it isn't very comprehensive, but a light over view of the history.
The History of Electricity in Perth
Well before your trusted Perth electrician knocked on your door for the latest job, Perth grew from a gold rush boom into the City of Light.
www.metropolitanelectrical.com.au
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Energy retailer tells more than 70,000 customers to go elsewhere or face doubling of prices
ReAmped Energy chief executive says he would rather people were ‘getting better deals’ amid soaring wholesale prices
The article sums it up really. I've posted it more to substantiate what I've been on about than anything else - there's a significant incident going on with all this, financially it's going to blow a few companies up I expect.
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Energy retailer tells more than 70,000 customers to go elsewhere or face doubling of prices
ReAmped Energy chief executive says he would rather people were ‘getting better deals’ amid soaring wholesale priceswww.theguardian.com
The article sums it up really. I've posted it more to substantiate what I've been on about than anything else - there's a significant incident going on with all this, financially it's going to blow a few companies up I expect.
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I'll let the official notice say it:
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Well this will certainly get people's attention.
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The government has a 'gas trigger' to keep supplies onshore and prices down. What would it take to pull it?
As gas prices rocket upwards, the federal government is fielding questions on whether it would use its "gas trigger" powers to force gas exporters to keep supplies onshore. But high prices alone may not be enough to pull the trigger.
www.abc.net.au
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The pending shortfall was known about years ago.
The train wreck of a previous federal government's policy that placed energy prices before supply and distribution is beginning to unfold.
And even if the trigger, which allows gas for export to be redirected for local consumption, is pulled the question of how to get the gas to where it's needed has to be resolved.
As Richard Marles said yesterday:
"We have got a cost of living crisis in this country. That’s what has been left to us by the former government. And we have got a real issue with power prices. Again, that’s the legacy of having had a decade under the Liberals where they haven’t had a consistent energy policy. Where there has been no investment in getting renewable energy going and that’s now the challenge that we face. ...
There are issues here which are going to take longer but which we need to start addressing now around having a settled policy in relation to energy policy and getting our grid up to a modern standard where it can take on renewables which are cheaper."
As noted in @SirRumpole's above link regarding the trigger, once pulled:"Even then, the earliest date export controls could be imposed is January next year, which would do nothing to help with the immediate issue of price peaks for businesses and households."
Knobby22
Mmmmmm 2nd breakfast
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We will just have to pass a law that some of the gas has to be kept is Australia for domestic use. Bad luck to existing overseas contracts.
WA have it, most other countries with gas have it. Even the USA does it. https://www.lexology.com/library/detail.aspx?g=3bb5950e-2259-43cd-9b3e-585e7b44ace4
Companies like Brickworks and many other manufacturing companies in Australia are going to go to the wall if we don't do something.
I heard one of our last clothing manufacture companies may have to shut down.
This was all discussed some time ago but nothing happened. We all saw this coming.
Once again the previous government was asleep at the wheel. They were meant to be pro business.
WA have it, most other countries with gas have it. Even the USA does it. https://www.lexology.com/library/detail.aspx?g=3bb5950e-2259-43cd-9b3e-585e7b44ace4
Companies like Brickworks and many other manufacturing companies in Australia are going to go to the wall if we don't do something.
I heard one of our last clothing manufacture companies may have to shut down.
This was all discussed some time ago but nothing happened. We all saw this coming.
Once again the previous government was asleep at the wheel. They were meant to be pro business.
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They were not asleep at the wheel, and nobody has been blindsided.
We were being steered onto the rocks by the most inept federal government since McMahon.
The good news in a fashion is that Labor must act quickly and decisively. And as harm has already been done, further damage can be sheeted back to their predecessors, thus avoiding being tarnished while at the same time earning plaudits for resolving the problem.
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Looking at the weather map of the Eastern states, I wonder how much solar is being generated under all that cloud and how reliant we are on coal, gas and hydro.
30% of the coal fired power capacity is down, a clear case of lack of maintenance which @Smurf1976 has pointed out many times.
It might be time for the Federal government to take over these assets, and ensure that the maintenance is done and that they can still contribute when necessary even though they may be stranded assets later on.
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They will have a Ouija Board out, now we will see how the problem will be fixed by some 'green' miracle, hope the batteries in the magic wand are charged. ?
It was only 5 years ago, we were going to have molten salt storage towers replacing coal power stations, S.A even ordered the biggest one in the world. How's that going?
Oh I forgot that was another brain fart, but the narrative moves on, nothing to see there, literally. ?
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A great example of how the private sector talks big but when the going gets tough the y get going somewhere else.They will have a Ouija Board out, now we will see how the problem will be fixed by some 'green' miracle, hope the batteries in the magic wand are charged. ?
It was only 5 years ago, we were going to have molten salt storage towers replacing coal power stations, S.A even ordered the biggest one in the world. How's that going?
Oh I forgot that was another brain fart, but the narrative moves on, nothing to see there, literally. ?
If governments are going to put money into these sort of projects then they should own them and make sure beforehand that they are going to work.
