Monday, June 09, 2008

A one-way market

Fears of winter electricity shortages are growing, meaning that ordinary residential users will soon face a campaign to get us to switch off in the name of "conservation". They have to call it that, because if they told us that it was really in the name of higher profits for generators (who can sell every joule we hedged residentials don't use to someone else for much more money) and major electricity users (who will benefit from lower spot prices), then we would rightly tell them to fuck off (or pay us, which amounts to the same thing).

But that's not all: the government is also planning to spend $40 million subsidising the Whirinaki power plant, allowing it to sell its electricity to the market at a loss, thus artificially lowering spot prices. That's a direct transfer from the taxpayer to the (mostly foreign) shareholders of our largest, greediest users (I'll leave the sanity of subsidising usage during a shortage to speak for itself).

So, when times are good, those major electricity users pay significantly lower prices due to the market. When times are bad, the government bails them out with our money, while telling us to shiver in the dark. This game is rigged. So why do we put up with it?