Electricity companies’ ‘short sighted’ behaviour passes ‘soaring’ costs to consumers: Australia Institute report – About Your Online Magazine


Australia’s electrical systems are poorly maintained, are dangerous and are in danger of failing, a new hard-hitting report revealed.

The power grid is a critical infrastructure piece and should be treated as such, according to researchers at the left-wing research institute Australia Institute.

But suppliers have the wrong priorities, prioritizing profits over maintenance and passing on “rising” costs to consumers, the researchers said.

The survey found that companies spent a lot of money on office managers and not enough to maintain and operate the network, with a 36% increase in managers in the same period, when there was a 1.2% reduction in the number of real electricians. .

Reports from workers across the country detailed anecdotes from electricity poles that rusted below the surface, toppling over at the slightest touch, and “banding solutions” used to keep the poles in the air beyond their expiration dates.

A Victoria energy industry worker who was interviewed said the electricity structures would be “left to break before being replaced”.

“They are still in the air, although they are known to fail,” said the person.

A Queensland union representative said that insufficient maintenance for long periods of time can lead to serious and dangerous situations.

“It doesn’t matter if it’s in the distribution or transmission, you start to extend the maintenance cycles, you run the risk of breaking parts of the plant, which can lead to explosions in circuit breakers, fall of poles, wires reaching the deck,” he said.

Important resources are wasted on “unproductive activities … that have nothing to do with the production and delivery of reliable and affordable energy,” says the report.

“It is time to fundamentally rethink a system that claims to be harnessing the power of market-driven efficiency in the interests of consumer well-being, but is actually facilitating useless and inefficient self-negotiation, financialization and myopia,” says the report. .

The report states that the regulatory regime for electricity suppliers has been “manipulated” to allow companies to increase their profits, even as the system deteriorates.

“The resources dedicated to the actual tasks of modernization, updating and maintenance have been reduced – as well as the employment for the electricity specialists themselves who carry out this work”, says the report.

“Massive resources were redirected, instead, to unproductive financial and corporate activities. Meanwhile, consumers pay unprecedented prices for services with sub-optimal reliability. “

The researchers based their findings on interviews with industry workers, previously available research articles and statistical evidence.

Among its seven recommendations was a call for energy companies to be fined if they spent less on maintenance.

“This would eliminate the current perverse incentive for private broadcasters and distributors to artificially suppress necessary maintenance and upgrades in the interest of a short-term bonus in addition to their already substantial profit margins,” wrote the researchers.

Paula Fonseca