Iemma’s electricity privatisation ignores Bali threats and opportunities

Dr Kaye said: “The Iemma government’s fire sale of electricity assets is being rushed through as the state winds down for the holidays. The Premier’s spin doctors are busy glossing over the difficult issues.

“Privatising the electricity industry is always a bad idea but this a particular silly time to be doing it.

“Premier Iemma and his Treasurer Michael Costa want to privatise the state’s coal-fired power stations that emit more than 55 million tonnes of CO2 each year.

“They want to hand over more than 35% of the state’s greenhouse gas emissions to corporate control.

“NSW cannot be both serious about reducing its emissions in line with the scientific evidence and selling off the coal burners with their contribution to global warming.

“The international community is moving towards a climate agreement that will kick in during the early years of privatisation. However this is played out in Australia, it will dramatically affect the economics of coal-fired power stations.

“The Owen Inquiry failed to address the problems of privatising or leasing the generators in a carbon-constrained economy. It ignored the impacts of the costs of purchasing emissions trading certificates on the sale price of the industry.

“If the state’s generators are not protected from the federal government’s emissions trading scheme, then the private operators could be facing a $2 billion a year bill. 

“Bids for the leases will be marked down to account for the risk of massive carbon costs. The state will lose out on the supposed revenues.

“The privatisation will also threaten the future of the renewable energy industry and energy efficiency,” Dr Kaye said.