A union-commissioned report shows that power privatisation has no long-term benefit and leads to higher prices and reduced reliability for consumers.
Unions are using a study showing power privatisation leads to higher prices to oppose plans to sell off state-owned generators in Queensland.
The Newman government is considering selling generators Stanwell and CS Energy after the next election.
But a report released on Thursday says that power price rises have been highest in Victoria and South Australia where power assets were sold off during the 1990s.
“What we see universally is that taxpayers lost out from privatisation,” the report’s author Professor John Quiggin said.
“There are no long-term benefits to government from the sale of assets to pay down debt.”
The report, commissioned by the Victorian branch of the Electrical Trades Union, said customer complaints to the ombudsmen jumped from 500 to over 50,000 a year, reliability suffered and resources were diverted into management and marketing.
“The kinds of cases being made for privatisation that there is a big bucket of money that can be used for any desirable public purpose is totally false and no serious economist will defend it,” Prof Quiggin said.
Before the 2015 Queensland election private investors could get a slice of equity in transmitters and distributors Ergon, Energex and Powerlink in return for paying for billions of dollars worth of infrastructure upgrades.
Instead of profits being funnelled directly into reducing bills, it will instead help pay down the state’s $80 billion debt.
Electricity prices in Queensland went up by 22 per cent this year and are forecast to go up 13 per cent next year.
Premier Campbell Newman wouldn’t give any guarantee that bills will be reduced from the foreshadowed reforms.
“I can promise them this, that if the carbon tax goes, electricity prices in the 14/15 financial year would go down,” he said.
“If the renewable energy target goes, even better.”
The premier dismissed Professor Quiggin’s report as an interesting academic exercise and questioned why the ETU spent members’ money on it.
Victorian ETU assistant secretary Wes Hayes said the union wanted to help out its northern comrades.
“If they are hearing that privatisation is a good thing, we’ve heard it all before and its false.
“It is effectively lies.”