Energy Minister Theo Theophanous (The Age, Business, 4/4) says, "Other states are looking to Victoria to once again take the lead". If that were true it would be a rerun of the 1990s Kennett/ Stockdale era. The reform agenda of that time, which is now universally acknowledged and applauded, was opposed lock, stock and barrel by Mr Theophanous, who was attempting to prevent the increased efficiency that the market-driven private system has delivered.
Then, as now, Mr Theophanous' policies stem from a belief that he knows the best interests of suppliers' and consumers' businesses better than they do. His latest policy thrust seeks to impose smart meters on electricity consumers. Smart meters have advantages but forcing their premature roll-out is overly expensive. Marco Bogaers in his letter (The Age, Business, 22/3) takes Mr Theophanous to task for understating these costs, overstating their benefits and misleadingly saying costs will be absorbed by business.
Mr Theophanous' policies all appear to share a common theme: that businesses can be milked and that consumers will not notice the higher costs. Other instances of this include:
- The imposition of environmental costs on the Hazelwood power station stemming from its routine application to continue in operation beyond 2010;
- Arbitrarily doubling coal royalties on generators;
- The Victorian renewable energy proposals to subsidise wind generation, with costs to consumers of $1.2 billion and 2000 lost jobs.
The Minister is leaning on the electricity retailers to use cost savings to improve social welfare and fund greenhouse gas measures. This would deny lower prices to the consumers. In addition it would seriously undermine Victoria's original electricity retailers which would be placed at a competitive disadvantage to new suppliers. Electricity markets work best without the incessant meddling of an overactive minister who has no understanding of business. Greater investment caution and higher costs will be the upshot of an electricity supply industry continuously having to interface and respond to Mr Theophanous' intrusiveness.
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