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"...public opinion deserves to be respected as well as despised" G.W.F. Hegel, 'Philosophy of Right'

mass deception « Previous | |Next »
June 29, 2011

One of the big deceptions currently circulating through the mainstream media is that the ongoing rise in the electricity prices is linked to a carbon tax. Prices are rising at a rapid rate, there are more increases in the pipeline (electricity prices are predicted to increase by at least 100% from 2008 levels by 2015), and the carbon tax will keep on being increased.

The inference is that the carbon tax is the reason for the increases in electricity prices even though the carbon tax is non-existent and the main cause of the price rises is a massive surge in electricity network investment. Others say that it is due to solar power (feed-in-tariffs) and the Federal government’s Renewable Energy Target (RET). Therein lies the mass deception of the public.

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The grid of the national electricity market is being renovated and extended in order to increase the supply to meet the projected increase in consumer demand for electricity--"keeping the lights on." Peak demand is growing faster than baseload demand, and that is largely driven by increased purchases of airconditioners.

The public policy emphasis is on increasing supply---including goldplating (overinvestment in infrastructure by electricity network companies) --not on reducing demand by making our homes and building more energy-efficient and so reducing peak demand. More money is being spent on poles, wires and substations and not enough on demand-side initiatives like demand management and energy efficiency in homes and offices.

The regulatory structure of the National Energy market discourages cheaper and more reliable demand-side solutions like demand management and energy efficiency, while rewarding supply-side solutions like network augmentation and centralised supply.

Even though Australia's electricity system is the main cause of our excessive greenhouse emissions but there is no consideration of this, or the cost of greenhouse emissions to the economy, in the design of the market. Simply put the rules of the National Electricity Market (NEM) are inappropriately focused on the supply of coal-fired electricity at the expense of energy savings and renewable energy technologies.

The National Electricity Market Objective is set out in Schedule 7 of the National Electricity market law, and it states that the objective of this Law is to promote efficient investment in, and efficient operation and use of, electricity services for the long-term interests of consumers of electricity with respect to:

(a) price, quality, safety, reliability and security of supply of electricity; and
(b) the reliability, safety and security of the national electricity system.

the components of the objective are fundamentally about the supply of electricity itself, irrespective of other consequential impacts associated with the electricity market, such as emissions of pollutants, or any legal rights to levels of service; or the de-carbonisation of the electricity sector.

One of the major obstacles to energy reform continues to be a culture which favours traditional 'build' engineering solutions and which pays little more than lip service to alternative options and the lack of an environmental objective for the NEM. So we have market failure. Hence the need for a sufficient carbon price signal.

| Posted by Gary Sauer-Thompson at 8:47 AM | | Comments (3)
Comments

Comments

Those on the political right often point out that ordinary Australians are opposed to a carbon tax to address climate change because of the cost of living pressures squeezing their budget. Therefore, introducing a carbon tax shows that Labor has an authoritarian contempt for the Australian people.

That is the "argument" of shrills like Janet Albrechtsen in The Australian. Their core message is that Labor has an authoritarian contempt for the Australian people and they twist issues around in order to make this authoritarian argument appear plausible.

Well, yes, the public do use a lot of airconditioners.
But that's only because the building codes are so slack that despite the capacity of the industry to produce housing in harmony with climate, we get dog boxes that are freezing in winter and boiling in summer- unlike the sorts of buildings going up a hundred years ago.

I think people do tend to whine about electricity prices because the bills seem to be coming all the time. A person might see the meter reader in the street. Oh no they think. Then the bill comes a few weeks later. Oh no they think. Then they pay it in 3 weeks time. ditto Then its only a few weeks later they see the meter reader again.
Our bill is usually $450 or so a quarter which is about 5 bucks a day. What do you get for 5 bucks that does for you what electricity does? Keeps the food refrigerated,lights on,pool clean,warm and cool,computer going,fish happy, garden watered,meals cooked. The list just goes on and on.
What does a person get for 5 bucks nowadays? A happy meal, a few ltrs of fuel,a short bus ride,half a lotto ticket, a couple of stubbies.
A lot of people should get their heads outa their bums.