Barnett Government abandoning its responsibility to supply reliable and safe electricity

Friday 08 Apr 2016

It has become increasingly clear that the Barnett Government intends to abandon the state’s long held responsibility to provide reliable and safe electricity to Western Australian households and businesses.

Over the last few months, the state government has flagged its intention to privatise Horizon Power’s Pilbara poles and wires, as well as privatise Western Power.  Yesterday, Energy Minister Mike Nahan revealed he planned to direct Synergy to close power stations.

If these extreme changes are implemented, it will mean that the state government will no longer be involved in generating or distributing power in the north of the state.  Those communities will be completely dependent on the private sector for their electricity.  Expect prices to go up, jobs and apprenticeships to be cut and preventative maintenance to become a thing of the past, as the new private operator(s) seek to maximise profits.

The Barnett and Nahan vision will also see the state government hand over Western Power’s poles and wires to the private sector.  Again, prices will go up, jobs and apprenticeships will be cut and preventative maintenance will stop, all in the pursuit of profit. 

The Royal Commission into Victoria’s Black Saturday bushfires revealed that poor maintenance and underinvestment in the network led to five of the worst fires being caused by faulty privatised power lines.  In our drying climate, the privatisation of Western Power would result in a massive increase in bushfire risk to communities in Perth’s hills and the south west.  While we can’t remove the risk of bushfire, we shouldn’t knowingly be making things worse.

Directing the closure of power stations reveals a state government that is cutting costs to prepare Synergy for sale, irrespective of the impact on the community.  Removing spare generation capacity will seriously threaten the reliability of electricity supplies during emergencies, such as the Varanus gas explosion, and extreme weather events, when electricity demand goes through the roof.

Under the Barnett and Nahan plan, the community will pay, one way or another.

Workers will pay, as jobs and apprenticeships are cut in the pursuit of profit.

Households and businesses will pay, when the lights go off during emergencies and extreme weather events, because the electricity system doesn’t have enough reserve capacity.

Communities across the state will pay, as staffing levels are cut, preventative maintenance budgets are slashed, and investment in the networks only occurs when it is profitable to do so.  Think blackouts at best, and catastrophic bushfires at worst.

And power prices will continue to rise.  For the eighth year in a row, the Barnett Government will increase power prices above the level of inflation in this year’s state budget, as it looks to make its electricity businesses more profitable and attractive to potential purchasers.  Forget Nahan’s talk of privatisation pushing down prices.  The intent to privatise, alone, has driven prices up.  Does anyone seriously thing they will come down, when Western Power goes from being a publicly owned monopoly to a privately owned monopoly?

When you stand back and look at the bigger picture in energy, it is clear nobody will win from the radical path being pursued by Barnett and Nahan.  Except, perhaps, the corporate advisory services and broking houses on St George’s Terrace, who will stand to make hundreds of millions of dollars in fees from the privatisation transactions.

The only way Western Australians can stop the state government abandoning its responsibility to supply reliable and safe electricity to Western Australian households and businesses, is for them to use their power at the ballot box and change the government at the 2017 state election.