The Public Interest Advocacy Centre has warned that there is no guarantee that energy prices will not increase under the NSW Government’s plan to privatise the State’s power industry.
‘The Government’s commitment to extending price regulation by only three years falls well short of effective consumer protection. Overseas and interstate experience has clearly demonstrated that privatisation results in price increases that disproportionately affect disadvantaged and low-income households’, said PIAC CEO Robin Banks.
Ms Banks stated that PIAC, which is funded to protect the interests of low-income and other households in the energy and water markets, remained unconvinced of the Government’s claimed benefits of power privatisation and commissioned the Institute for Sustainable Futures at UTS to review the economic, environmental and consumer impacts of the recommendations in the Owen Report.
The UTS Report (which can be accessed at https://piac.asn.au/) found that the decision to privatise the State’s power industry is based on a number of flawed assumptions, including the flawed assumption that NSW will receive a generous price for its power assets off-setting the cost of a new power generator.
While the Government has been highlighting the benefits to the State of selling the power stations and retail arms of the three State-owned companies, the interests of consumers and the environment have been largely ignored.
‘Privatising power seldom results in lower prices or better service for consumers. It creates private corporate demand for less regulation and limits public scrutiny, both of which adversely affect the least powerful players in the market, being low-income and other households’, said Ms Banks.
The Government’s decision also flies in the face of the need to curb greenhouse emissions. ‘Instead of encouraging companies to build new coal- or gas-fired power stations that will add to emissions, we should be encouraging greater energy efficiency and the development of new renewable energy’, Ms Banks added.
PIAC and other social justice and welfare organisations are arguing for more open discussion about the long-term effects of privatisation before the NSW Government makes its final decision.
MEDIA CONTACT: Dominic O’Grady, Media and Communications Officer,
Public Interest Advocacy Centre. Ph: 02 8898 6532 or 0400 110 169