A PRIVATISED UTILITY SEEMS TO BE GOING BAD: TRUENERGY DOWN THE TUBES?

A couple of missives have landed in Miss Eagle's mailbox which make her wonder if there's something rotten in the state of Denmark or, to be more precise, the land of privatised utility corporations.

The first one, dear Networkers, to come across the desk was from those avid Networkers doing their best to save Solar Systems.  Here 'tis:

From: Chris Breen

To: Philip Sutton ; climateemergencynetwork@yahoogroups.com; grassroots_climate_oz@yahoogroups.com
Cc: savesolarsystems@googlegroups.com
Sent: Mon, 9 November, 2009 10:18:01 AM
Subject: Re: [GRCO] Plans for two new big gas fired power stations for Vic and NSW = continuation or increase of CO2 emissions
Its also worth pointing out that TRUenergy parent CLP group decided to write off its investment in Solar Systems (they had invested $53 million & decided to write that off as a loss, rather than put more money in without finding co-investors). So they can find $2 billion for a new gas fired power plant, but cant find $200 million or so to build a solar power plant in Mildura.

The gas plant is also dependent on near tripling of compensation to coal-fired generators from $3 billion to $10 billion. Regardless of the specifics of the gas proposal, this also seems to be part of a play for more compensation under the CPRS.

The government should ditch all compensation and just directly build renewables - $10 billion could build a lot of renewables.

Renewables are more expensive than gas, but on the figures below not by a whole lot
1000 megawatt gas plant costs approx $2 billion
154 megawatt solar plant costs approx $420 million

Assuming no efficiencies of scale that would make 1000 megawatt of solar cost $2.7 billion, not out of the ball park compared with gas (& solar can be modular, it doesn't have to be all in the same place or built all at once)

Next protest for Solar Systems & to build the Mildura solar power plant will be Monday November 16, 12.30pm, 280 King St, City. Protest is at Lindsay Tanner's office (he is minister for Finance & Deregulation & MP in area where Abbosttsford solar factory is), but I think we should march to TRUenergy offices, which are just around the corner in Bourke St and finish our protest there.
more info here
http://savesolarsystems.wordpress.com/

Then next came a Media Release from the Australian Conservation Foundation:

Investigation urged on blackout threat

Date: 11-Nov-2009

Environment groups have asked the national energy watchdog to investigate claims by TRUenergy that suggest the company may be about to default on electricity supply contracts.
Over the past year TRUenergy has repeatedly claimed there was a risk of blackouts if it did not receive more compensation under a national emissions trading scheme.

Environment Victoria and the Australian Conservation Foundation have today written to the Australian Energy Regulator, asking the regulator to examine the accuracy of TRUenergy’s claims that the company may be about to default on contracts.

Environment Victoria Campaigns Director Mark Wakeham said: “TRUenergy’s 1.3 million customers deserve to know whether they can rely on TRUenergy to deliver on its contracts and whether the company is crying wolf in an attempt to line its own pockets.

“Claims that the electricity supply is at risk and that the company has reduced maintenance spending at Yallourn power station should be thoroughly investigated.
TRUenergy is 100 per cent foreign owned by CLP Power International (formerly China Light and Power). ACF climate campaigner Phil Freeman said he was concerned about windfall profits going offshore with no benefit to Australian households or taxpayers.

“TRUenergy is already set to receive $738 million worth of free permits in the first five years of the proposed Carbon Pollution Reduction Scheme.[1] There is no case for the company to get more handouts from the public purse,” Mr Freeman said.

“The Government should reject these scare tactics because giving more handouts to big polluters will slow down the transition to a low carbon economy and lessen the environmental effectiveness of the emissions trading scheme.”

The letter has also been sent to the Australian Energy Market Operator, the Essential Services Commission, the Australian Energy Market Commission and the Australian Competition and Consumer Commission.

[1] Innovest Research note: The impact of industry assistance measures under the CPRS White Paper update, 16/10/200

Seems to me, that TRUenergy is not a TRUE friend and that institutional reform in respect of public - not privatised - utilities is called for.

POSTSCRIPT

SOON AFTER WRITING THE ABOVE POST

Don't miss Denis Wilson's comment below.