Iemma private electricity blunder

Labor Premier Morris Iemma's support for privatisation of NSW's power stations is undoubtedly a backward move. This move is especially backward in the light of the needs to regulate power production on a State and National level to deal with the effects climate change. Even the US, the foremost advocate of privatisation, is having to reconsider that policy to deal with the mess that it has left them with. Maybe Iemma is just unaware of the new realities.

The New York Times last week reported that more than a decade after the drive began to convert electricity from a regulated industry into a competitive one, many states are rolling back their initiatives or returning money to individuals and businesses.

"The main reason behind the effort to return to a more regulated market is price" the paper said.

"Recent Energy Department data shows that the cost of power in states that embraced competition has risen faster than in states that had retained traditional rate regulation."

Of the 25 states, and the District of Columbia, that had adopted competition, only one, California, is even talking about expanding market pricing. In Ohio, politicians, utilities, their customers and consumer groups are negotiating how to end competitive electricity pricing, while Virginia has repealed its law.