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So....we are paying the highest rate for Electricity in the World.....NSW anyway...


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Posted
  On 03/03/2017 at 5:07 AM, comfortablynumb said:


What sort of price do you think they might ask? Given that what they have is almost a license to print money.

Unless they mean just taking it. Like in traditional "nationalisation"

Which opens a large can of worms

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NFI...sale price should be "fair & reasonable" & independently assessed to be fair & reasonable...

If private companies want to profiteer legislate for "fair & reasonable"...

Power is of much greater national strategic importance than broadband...

Posted
  On 03/03/2017 at 4:43 AM, proftournesol said:

A study of the electricity, gas and water industries undertaken by the Australia Institute found that the number of technical and trades workers employed in these industries had grown by less than the workforce as a whole between 1997 and 2012 (28 per cent as opposed to 37 per cent). By contrast, the number of managers had more than doubled, HR and marketing professionals had more than tripled, and the number of sales workers had risen by 500 per cent. 

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I agree there is a huge imbalance to actually getting things done ... is the maintenance of the systems... and its all greatly outsourced ... you wouldnt believe to the extent !!! Ive visited at one of the shutdowns last year for instance.

 

  On 03/03/2017 at 4:43 AM, proftournesol said:

At the beginning of the period, technicians outnumbered managerial and retail staff. By the end, the reverse was true. In particular, ‘in 1997 there was a manager for every 13 workers, but by 2012 there was a manager for every nine workers’.

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this i.e. the ratio is actually not a bad thing. its a western thing to have massive teams huge numbers managed by one manager when the japanese thinking is much smaller teams shorter span of control can be as much as 3-4 for a team leader at most 4-8 reporting to a leader. note i didnt say manager. 

 

where we go nuts is in all these sales marketing admin, hr(though this is mostly outsourced too these days). it really is all geared toward sales and marketing when the actual product isnt getting the attention it once did ! 

Posted
  On 03/03/2017 at 4:43 AM, proftournesol said:

gradual process of this kind should be sufficient to return most of the grid to public ownership. If necessary, any remaining holdouts could be subject to compulsory acquisition on just terms. 

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definitely needs to be grabbed back into control for the nations long term interest.

Posted

The privatisation of the Electricity industry in Victoria has been a disaster. The prices have risen contrary to the promise that they would fall when privatisation was implemented. Is anyone surprised? Also there has not been a new base load Power Station built since . Not using any sort of technology, Hydro, Coal, Nuclear, nothing. The old SEC that I used to work for was dismantled and sold off bit by bit to the highest bidders many of which are foreign owned. The Hazelwood Power Station is soon to be closed by its French owners due to its completely outdated technology. I wonder what will happen if next Summer in Victoria is hotter than this season's lower than average temperatures? The government should just admit that Electricity generation and distribution is just too important to be left to profit focussed companies.It is a government responsiblty. The private companies have had a crack and they buggered it up.

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Posted
  On 03/03/2017 at 6:18 AM, Saxon Hall said:

The privatisation of the Electricity industry in Victoria has been a disaster. The prices have risen contrary to the promise that they would fall when privatisation was implemented. Is anyone surprised? Also there has not been a new base load Power Station built since . Not using any sort of technology, Hydro, Coal, Nuclear, nothing. The old SEC that I used to work for was dismantled and sold off bit by bit to the highest bidders many of which are foreign owned. The Hazelwood Power Station is soon to be closed by its French owners due to its completely outdated technology. I wonder what will happen if next Summer in Victoria is hotter than this season's lower than average temperatures? The government should just admit that Electricity generation and distribution is just too important to be left to profit focussed companies.It is a government responsiblty. The private companies have had a crack and they buggered it up.

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All that is correct and applies to all the states.

What I'm trying to get at is, how are we going to get it back, now the cat is out of the bag?

We either take it and expose ourselves to massive litigation, or buy it back and be over a bigger barrel than we already are.

And anyway, in the modern political enviroment, even if that were successful, every time something as simple as a box of staplers was ordered, it would become massively political. With endless yea and naying and bickering from either side till nothing is done. As usual.

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Posted

they arent just going to hand it over...

 

for some eg hazel wood would have been poison chalice for engie when got handed to them. though ham sure shutting it down at some stage was always on their cards. i mena who would in right mind still keep such an old power station up and running ! 

 

am not really sure why anyone thinks any operator is going to open any new power stations either. just adding capacity to a system makes no sense at all does it ? just will create more volume which as we all know drops price ! 

 

it makes sense for them to have less ! :D less cost to maintain...higher electricity prices because cant keep up with demand. they arent stoopid ! :P

Posted
  On 03/03/2017 at 7:18 AM, :) al said:

they arent just going to hand it over...

 

for some eg hazel wood would have been poison chalice for engie when got handed to them. though ham sure shutting it down at some stage was always on their cards. i mena who would in right mind still keep such an old power station up and running ! 

 

am not really sure why anyone thinks any operator is going to open any new power stations either. just adding capacity to a system makes no sense at all does it ? just will create more volume which as we all know drops price ! 

 

it makes sense for them to have less ! :D less cost to maintain...higher electricity prices because cant keep up with demand. they arent stoopid ! :P

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But, but, but......

Competition, the market etc will drive prices down.

Isn't that the mantra?

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Posted
  On 03/03/2017 at 7:24 AM, comfortablynumb said:

 

But, but, but......

Competition, the market etc will drive prices down.

Isn't that the mantra?

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I worked at a wholesale company in the 90s who were in "competition" with four others in our state. I know exactly how "competition" works. And these guys weren't playing in the same league as the electricity suppliers.

Posted

High power prices are taking their toll on our economy and jobs. Latest news is that Rio Tinto will cut back their aluminium production and slash more than 100 jobs because they were unable to negotiate economical power prices from Qld's power providers. 

 

http://www.theaustralian.com.au/business/mining-energy/rio-tinto-aluminium-smelter-to-slash-jobs-as-power-prices-bite/news-story/b22c667e1b48e759eb9c5576b56e0f72

 

This is crazy. If a large customer like Rio Tinto is unable to secure 'affordable' power prices, what hope is there for small businesses and family households?

  • Like 1
Posted

These large companies have had outrageously low power prices. They have benefitted from the gold plating paid for by consumers. It never made sense that we would run Hazlewood to supply cheap power to Portland and Geelong smelters. When measured in total cost in all aspects of the assets life cycle, its plain that consumer cross-subsidy of profit is the name of the game.

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Posted
  On 03/03/2017 at 12:38 PM, LHC said:

High power prices are taking their toll on our economy and jobs. Latest news is that Rio Tinto will cut back their aluminium production and slash more than 100 jobs because they were unable to negotiate economical power prices from Qld's power providers. 

 

http://www.theaustralian.com.au/business/mining-energy/rio-tinto-aluminium-smelter-to-slash-jobs-as-power-prices-bite/news-story/b22c667e1b48e759eb9c5576b56e0f72

 

This is crazy. If a large customer like Rio Tinto is unable to secure 'affordable' power prices, what hope is there for small businesses and family households?

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this is the reality bluescope is facing and what I posted earlier. it is a reality which I know some have a hard time accepting but it is very real what industry is facing making struggle to be competitive. 

Posted
  On 03/03/2017 at 8:56 PM, :) al said:

 

this is the reality bluescope is facing and what I posted earlier. it is a reality which I know some have a hard time accepting but it is very real what industry is facing making struggle to be competitive. 

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Bluescope have an integrated steelworks that uses alot of power.

It also produces alot of waste heat and waste combustible gasses.

If they have the cash and the nerve, they can create an extra income stream as well as secure their future.

Posted
  On 03/03/2017 at 7:25 PM, ThirdDrawerDown said:

These large companies have had outrageously low power prices. They have benefitted from the gold plating paid for by consumers. It never made sense that we would run Hazlewood to supply cheap power to Portland and Geelong smelters. When measured in total cost in all aspects of the assets life cycle, its plain that consumer cross-subsidy of profit is the name of the game.

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I don't believe that type of thinking helps anybody. You are now pitting the interest of large companies against the interest of ordinary consumers. That is exactly what the power suppliers want, because it takes the heat and attention away from them. A much better approach is to concentrate the interests of large companies, small companies and consumers on the power suppliers themselves. Collectively make a strong case that power prices should be lowered for everybody, not just the select few who are better at negotiation. 

Posted (edited)
  On 03/03/2017 at 9:54 AM, crisis said:

I worked at a wholesale company in the 90s who were in "competition" with four others in our state. I know exactly how "competition" works. And these guys weren't playing in the same league as the electricity suppliers.

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Sound familiar?

 

https://en.m.wikipedia.org/wiki/California_electricity_crisis

Edited by mrbuzzardstubble
  • Like 1
Posted
  On 03/03/2017 at 11:07 PM, mrbuzzardstubble said:
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Good post and link. I note the following quote from the article:

 

"Deregulation did not encourage new producers to create more power and drive down prices. Instead, with increasing demand for electricity, the producers of energy charged more for electricity"

 

That is the thing with markets, it relies on genuine competition and willingness of new players to enter with fresh ideas and innovation to drive down prices. If that does not happen, then the existing players will just take advantage of their monopoly position and game the system for their own profit. 

  • Like 3

Posted
  On 03/03/2017 at 11:20 PM, LHC said:

 

Good post and link. I note the following quote from the article:

 

"Deregulation did not encourage new producers to create more power and drive down prices. Instead, with increasing demand for electricity, the producers of energy charged more for electricity"

 

That is the thing with markets, it relies on genuine competition and willingness of new players to enter with fresh ideas and innovation to drive down prices. If that does not happen, then the existing players will just take advantage of their monopoly position and game the system for their own profit. 

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Spot on! Couldn't agree more.

 

  • Like 1
Posted
  On 03/03/2017 at 10:59 PM, LHC said:

 

I don't believe that type of thinking helps anybody. You are now pitting the interest of large companies against the interest of ordinary consumers. That is exactly what the power suppliers want, because it takes the heat and attention away from them. A much better approach is to concentrate the interests of large companies, small companies and consumers on the power suppliers themselves. Collectively make a strong case that power prices should be lowered for everybody, not just the select few who are better at negotiation. 

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It is not "thinking" it is fact...

Power supply to the largest customer/s must realise a GP/NP & acceptable ROI for the supplier.

A number of large users have made similar claims in the last 18 months as their electricity contracts have been up for renegotiation.

They have used the press to try & force public/govt emotional pressure to intervene so their own GP/NP can remain.

If large customers were genuine...publish the reduction in GP/NP...then just maybe they would have more credibility... 

  • Like 1
Posted

Are we to drive more industry overseas by making them even less competitive?

You don't go broke making a profit.

Business is about making profit.

 

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Posted
  On 03/03/2017 at 11:59 PM, joz said:

Are we to drive more industry overseas by making them even less competitive?

You don't go broke making a profit.

Business is about making profit.

 

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Yes it is about making a profit...hence the reason the cost of the power has risen...

Industry will have rise & fall clauses written into their contracts...similar to the transport sector with their "diesel variation clauses"...

Posted
  On 03/03/2017 at 11:20 PM, LHC said:

 

Good post and link. I note the following quote from the article:

 

"Deregulation did not encourage new producers to create more power and drive down prices. Instead, with increasing demand for electricity, the producers of energy charged more for electricity"

 

That is the thing with markets, it relies on genuine competition and willingness of new players to enter with fresh ideas and innovation to drive down prices. If that does not happen, then the existing players will just take advantage of their monopoly position and game the system for their own profit. 

Expand  

Actually new producers (of renewable energy) were encouraged and responded, the Government's response was to disadvantage them as much as possible in order to suppress their growth

  • Like 1
Posted
  On 03/03/2017 at 7:24 AM, comfortablynumb said:

 

But, but, but......

Competition, the market etc will drive prices down.

Isn't that the mantra?

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Yes, it's a line from the same hymn that says that private enterprise can always do it better faster and cheaper irrespective of the industry or the goals of the industry.

  • Like 2
Posted
  On 04/03/2017 at 3:05 AM, proftournesol said:

Yes, it's a line from the same hymn that says that private enterprise can always do it better faster and cheaper irrespective of the industry or the goals of the industry.

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I can't recall all the words to that hymn but I'm sure it contains the phrase "Trickle-down effect"

Posted
  On 06/03/2017 at 2:46 AM, :) al said:

No Gas, No Power, No future ?

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Indeed.   Totally ineffective regulation of the gas industry in Oz.

 

 

Even in a free for all like the USA, there are laws there which require that a certain (significant) percentage of gas extracted is provided to the domestic market (therefore insulating the domestic users from scarcity, and export contracts, etc.).     AFAIUI we have nothing of the sort here.

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