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Australia's electricity crisis demonstrates the madness of capitalism

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Max O.

The famous French writer Andre Gide commented on the matter of deception with the following insight: "The true hypocrite is one who ceases to perceive his deception, the one lies with sincerity". The Australian people have now come to expect this behaviour from Prime Minister Malcolm Turnbull who habitually performs malicious acts of dishonesty, with his foray into the electricity energy crisis being the latest example.

The progressive and urbane environmentalist has now contorted himself into a fossil-breathing, coal-hugger. Turnbull, and cabinet Ministers Frydenberg and Morrison, at the behest of the coal industry and the Minerals Council, went into attack over the electricity power blackouts in South Australia that occurred in July last year and February this year, 

They blamed the SA Weatherill Labor government for relying excessively on 'intermittent renewable energy' and putting the state's power supply in jeopardy. The implication being that South Australia's increasing use of renewable energy was the cause of blackouts, because when wind is not blowing and the sun is not shining turbines and solar panels don't produce electricity.

This assertion was mischievous to say the least, when in fact the July blackouts in South Australia were caused by storm damage to electricity towers which stopped power transmission to houses and businesses throughout the state. Reliance on fossil fuel generators wouldn't have stopped the blackout.

Who's really at fault for the blackouts?
This year's February blackouts in South Australia, where 100,000 households lost power, were the result of the Australian Energy Market Operator's (AEMO) blunder on a day of scorching temperatures and the consequent high demand. To avert a failure of the entire grid AEMO ordered load shedding, in other words rolling blackouts.

Despite AEMO calling for electricity generators to bid offers for providing power, none did. This seemed strange considering that there was "an unprecedented level of demand" and the market price for electricity was rising.

In the face of these facts the Turnbull Coalition government spewed forth the deceitful mantra, "Now more than ever, Australians need affordable and reliable electricity, affordable and reliable energy, as we meet our emissions reductions targets." Then in the next breath he goes onto the attack: "We’ve seen a shocking failure of leadership by Labor’s state governments and of course, we see in Western Australia the Labor opposition proposing a 50 per cent renewables target."

Whilst not fully opposing the need for carbon emission targets, the Turnbull Coalition government are in reality opposed to the concept and regularly rail against further emission reductions and any increase in renewable energy. Doing the bidding of the Minerals Council and coal industry, they have started to tout the dubious advantages of clean coal  generators, coal seam gas, pump hydro with battery storage throw in to make themselves look visionary.

What the Coalition government have dared not spoken about over the electricity crisis is the critical and more important matter of energy companies withholding  supply. What is stopping Australia having an 'affordable and reliable' electricity is the energy corporations 'gaming' the system by withholding power supplies to achieve electricity price spikes.

The energy economics consultant from CME (Carbon and Energy Markets), Bruce Mountain, stated that the primary cause of the South Australian blackout in early February was the same as what occurred in July last year; deliberately orchestrated low supply led to enormous spikes in wholesale electricity prices. He pointed out that the electricity market generation capability far surpassed the demand. Mountain noted that all the fossil fuel generators, except for Origin, carried on operating well below their capability, so as to sell electricity to the market at a very high price.

The electricity market's artificially orchestrated high energy costs to consumers has got so bad now that industry is complaining that it has become both unaffordable and unreliable. Big corporations such as aluminium smelters and steel manufacturers have, in particular, warned against the lack of stability and high power prices.

Privatisation and Nationalisation
The privatisation of previously state-owned power providers and the creation of an energy market is the actual cause of Australia's electricity crisis.

Both consumers and industry are feeling the effects of the anarchy that the capitalist mode of production causes.

After the Second World War Australian economic development required the capitalist state to carry out nationalisation of the multitude of electricity companies for the simple reason they would not undertake the electrification of rural and regional locations. This brings to mind Marx's pertinent comment: "This is why capital is productive; i.e. an essential relation for the development of the social productive forces. It ceases to exist as such only where the development of these productive forces themselves encounters its barrier in capital itself." Marx, The Grundrisse (1857)

Therefore energy production, especially electricity, needs to be operated as a public/state utility to achieve, using Turnbull's  appealing mantra, 'affordability and reliability'. Capitalism  is tottering from crisis to crisis and running on empty at the moment. Other than pillaging, it offers no solutions to the economic and environmental disasters it creates.

Electricity generation and distribution needs be nationalised for the good of society, although it is highly unlikely this will happen again by the capitalist state. This will only be achieved under workers' state power.


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