Australia’s energy woes will not be solved by reinforcing a monopoly



Australia’s energy market has a logjam,
Sean Davis/Flickr, CC BY-NC-SA

Bruce Mountain, Victoria University

The possibility of blackouts affecting half of Victoria has attracted plenty of attention to a document once read only by industry insiders and policy wonks: the Electricity Statement of Opportunities.

The Statement, updated every year by the Australian Energy Market Operator (AEMO), forecasts 10-year supply and demand in the main grids that serve the Australia’s south and eastern states.

But the chance of huge blackouts is just part of the Statement – and in fact it reveals a growing tension between the market operator and the bodies that oversee electricity regulations.




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Blackouts unlikely

So, what does the latest Statement say? The good news is AEMO calculates the expected level of “unserved energy” – that is, demand that cannot be met by supply – is likely to be fairly low, which makes blackouts unlikely.

The bad news is AEMO thinks a standard based on “expected unserved energy” is a poor way to forecast keeping the lights on.

Instead, AEMO points to the unlikely events that nonetheless could have a significant impact on consumers and says we should frame reliability obligations around those.




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In its analysis of these, AEMO finds it is possible (albeit unlikely) about half of Victoria’s households could lose supply in a single event in the coming year.

So, on the one hand AEMO expects the system will basically meet the current obligations for unserved energy, but it also says there is nonetheless the possibility half of Victoria’s homes could suffer outages because of shortfalls on the main power system.

Importantly, as AEMO’s obligation is to hit the expected unserved energy standard, not beat it, it is not authorised to take actions to mitigate these outside possibilities.

Market vs regulators

To really understand the issues here, we need to look back to last year. In 2018, AEMO sought to change Australia’s energy regulations so AEMO could buy as much reserve capacity as it decided was needed to reliably manage unlikely but possible severe failures.

It also asked for the authority to buy reserves for longer periods so that it could source reserves more cheaply.

The Australian Energy Market Commission (AEMC) that sets the rules rejected this application on the basis that the standards were already high enough – maybe even too high – and AEMO was unduly risk-averse (the political risk associated with power failures made it so). By implication, left to its own devices AEMO would look after itself, at customers’ expense.

Whatever the stated rationale, underlying AEMC’s rejection of AEMO’s application is the philosophy of the sanctity of the market: wherever possible, the market is to be protected from intervention.

From the regulator’s perspective, were it to have acceded to AEMO’s request to expand the volume of reserves AEMO bought outside the market, it would be buying reserves it did not need and allowing the price signals in the market to be further undermined.

But I would argue the regulator’s decision is better characterised as protecting the National Electricity Market’s monopoly for the exchange of wholesale electricity.

It may be acceptable to force transactions through a market if there is confidence in that market. But the evidence of market failure is abundant: wholesale prices in Victoria at record highs, rampant exercise of market power, reliability concerns that often make the front page, and in certain cases shortfalls in dispatchable capacity, storage and price-responsive demand.




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In its Statement, AEMO signalled it will work with Victoria’s state government to explore ways they can work together to meet Victoria’s reliability needs, in spite of the AEMC’s decision.

This is a very significant development and I envisage it will presage similar bilateral arrangements between AEMO and other states.




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Should we be worried about this? Not in the least. Electricity markets do not spontaneously arise; they are administrative constructions. For too long the National Electricity Market has had a monopoly on the exchange of wholesale electricity and the AEMC has had a monopoly on its oversight. Monopolies and markets ossify when they get stuck in their originating orthodoxy and ideology.

AEMO is beginning to clear a log jam. There is a spirit of innovation and discovery in the air. This is something to welcome and it is not a moment too soon.The Conversation

Bruce Mountain, Director, Victoria Energy Policy Centre, Victoria University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Microsoft on Google


The link below is to an interesting article concerning some comments made by Microsoft CEO Steve Ballmer on Google and its ‘monopoly.’

For more visit:
http://www.theverge.com/2013/9/20/4751516/ballmer-calls-google-a-monopoly

INDIA: STAKES HIGH FOR CHRISTIANS IN ELECTIONS


Beleaguered minority has much to lose, gain in polls.

NEW DELHI, May 1 (Compass Direct News) – With elections underway in India, its 2.3 percent Christian minority – which faced a deadly spate of attacks in the eastern state of Orissa last year – is praying for a secular party to come to power.

Along with the Muslim community, Christians fear that if the Hindu nationalist Bharatiya Janata Party (BJP) and its allies form the next government or an ideologically loose coalition comes to the helm, their already compromised welfare may further deteriorate.

Dr. John Dayal, secretary general of the All India Christian Council, said that the end of the Congress Party’s monopoly on power in the 1990s led to the rise of several major individual groups, including the BJP, political wing of the Hindu extremist Rashtriya Swayamsevak Sangh (RSS) conglomerate.

“The rise of regional and linguistic or caste-based parties spells a danger for pan-national minorities, as parties with a narrow and localized outlook will have neither the strength nor the political need to come to their defense,” Dayal told Compass. “What is at stake now, as never before, is the stability and consistency of India’s constitutional institutions in their response to critical situations, their zeal to correct wrongs and their commitment to the welfare of the weakest and the lowest.”

Religious minorities, Dayal said, were hoping for a strong showing by a secular party, “possibly the Congress [Party],” supported by regional groups of a secular character.

“Personally, I would even welcome a Third Front [a grouping of anti-Congress Party and anti-BJP parties led by the Communist Party of India-Marxist] government supported by the Congress Party,” he added. “Certainly, a BJP-led government is the least desirable, as we fear major erosion and even regression in issues of freedom of faith, Dalit liberation and affirmative action for the poor.”

With the BJP in power, directly or as part of the ruling alliance, in 10 states – Madhya Pradesh, Himachal Pradesh, Uttarakhand, and Punjab in the north; Chhattisgarh and Bihar in the east; Gujarat in the west; Nagaland and Meghalaya in the northeast; and Karnataka in the south – he said Christians believe it is important that a strong, secular government comes into power at the federal level.

The federal government can issue warnings and ultimately dismiss state legislatures and state executives if they fail to protect the lives of their people or major unrest erupts. The federal government can also make laws applicable across the nation.

The BJP-ruled states have become “absolutely inhospitable” and “hostile” to Christians thanks to the “inaction of the federal government,” said Sajan K. George, national president of the Global Council of Indian Christians (GCIC).

 

Orissa, Andhra Pradesh

The eyes of Christians are also on state assembly elections in Orissa state.

Orissa is ruled by the Biju Janata Dal (BJD), which on March 7 broke its 11-year-old alliance with the BJP over the latter’s involvement in Kandhamal district violence. Elections in Orissa, held on April 16 and 23, are particularly important given that the results will either embolden Hindu nationalists to launch more attacks to polarize voters along religious lines or compel them to abstain from violence.

In December 2007, a series of brutal attacks began in Kandhamal. The violence that lasted for around 10 days killed at least four Christians and burned 730 houses and 95 churches under the pretext of avenging an alleged attack on Swami Laxmanananda Saraswati, a leader of the Vishwa Hindu Parishad (World Hindu Council).

Violence re-erupted in the district following the killing of Saraswati on August 23, 2008. A Maoist group took responsibility for the murder, but BJP supporters claimed that Christians were behind the assassination.

The BJP has made the killing of Saraswati its main election plank. The party’s two candidates from Kandhamal – Manoj Pradhan for the G. Udaygiri assembly seat and Ashok Sahu for the Kandhamal parliamentary constituency – contested the elections from jail. Pradhan, a primary suspect in the August-September 2008 violence, has been in jail for the last few months. Sahu, a former senior police official, was arrested on April 14 for delivering a hate speech against Christians in the run-up to elections. He was released on bail on April 17.

In its election campaign, the BJD promised to provide protection to the Christian community in Kandhamal and elsewhere in the state, putting the blame of the Kandhamal violence entirely on the BJP.

“It was important to break up with the BJP because I don’t consider them healthy any longer for my state after Kandhamal – which I think is very apparent to everyone,” Orissa Chief Minister Naveen Patnaik told CNN-IBN on April 19. “Before Kandhamal, we were lucky in the early years of the state government not to have a serious communal problem at all. But Kandhamal was very tragic and serious.”

According to the CNN-IBN private news channel, the Congress Party could benefit from the divorce of the BJD and the BJP. Nevertheless, the BJD is expected to form the next state government in Orissa.

The Congress Party, on the other hand, blamed both the BJD and the BJP for last year’s violence.

Elections in Kandhamal took place despite the fact that over 3,000 Christians were still in relief camps and hundreds of others had fled to others parts of the state fearing more tensions. Father Ajay Kumar Singh of the Catholic Archdiocese of Cuttack-Bhubaneswar reached Kandhamal from the neighboring Gajapati district early on April 16, election day.

“Along the way, we came across numerous felled trees blocking the road in at least six places,” Fr. Singh told Compass. “The roads were deserted, and my colleagues and I were scared. But we somehow managed to reach Kandhamal.”

He added that in Dharampur in Raikia Block and in Kattingia near Tiangia in G. Udaygiri Block – where eight Christians were killed during last year’s violence – Christians were threatened if they did not vote for the BJP.

In Nilungia village, seven kilometers (four miles) from G. Udaygiri, where a Christian was killed, at least 40 Christians did not cast their votes out of fear of a backlash, Fr. Singh said.

“They feared tensions if they returned to their village and stayed out of the district,” he said.

The Catholic Church in Orissa had urged the Election Commission of India to postpone elections in Kandhamal, but polls were held as scheduled.

According to the district administration, the poll turnout on April 16 in Kandhamal was around 55 percent.

The violence following Saraswati’s murder lasted for over a month, killing more than 127 people and destroying 315 villages, 4,640 houses, 252 churches and 13 educational institutions, besides rendering more than 50,000 homeless.

The incidence of Christian persecution is high in Andhra Pradesh, too. Analysts anticipate a neck-to-neck competition between the ruling Congress Party and the regional Telugu Desam Party (TDP), which recently allied with Left parties in the Third Front. The BJP is also in the fray but doesn’t appear strong enough to stake claim to power in the state.

 

Obscure Prognosis

With election results not due until May 16, the outlook at this point is murky.

“About all that can be said with certainty in the resulting alphabet soup of political parties is that the BJP won’t be aligning with Congress, or with the Left. Beyond that it’s a numbers game,” The Times of India noted in an editorial today. “Most observers agree that alignments determining who will form the next government will be decided only after the elections.”

The national daily added, “As India’s long, hot election summer grinds on, with the third phase held yesterday and the fifth and final phase not scheduled before the 13th of this month, it’s regrettable that no overarching themes have emerged even at this late stage, which can define the election.”

With 714 million eligible voters of the more than 1 billion people in the country, the five-phase elections for the 15th Lok Sabha (Lower House of Parliament) and for the state assemblies of Orissa, Andhra Pradesh and the north-eastern state of Sikkim began on April 16.

The three main parties are the left-of-center Congress Party (officially known as the Indian National Congress), which leads the governing United Progressive Alliance (UPA); the Hindu nationalist BJP, a leading party of the opposition National Democratic Alliance (NDA); and the Third Front.

A party and its allies need 272 members to rule in the 545-member Lok Sabha.

 

Expediency over Ideology

The regional and caste parties involved include the Bahujan Samaj Party (BSP), headed by Dalit (formerly “untouchable”) woman Mayawati, chief minister of Uttar Pradesh state in the north; and the Samajwadi Party (SP), also a powerful party in that state.

Other significant parties are the Janata Dal-United (JD-U) party and the Rashtriya Janata Dal (RJD) party in the eastern state of Bihar; the BJD in Orissa; the Trinamool Congress party in the eastern state of West Bengal; the Nationalist Congress Party (NCP) and the Shiv Sena party in the western state of Maharashtra; the All India Anna Dravida Munnetra Kazhagam (AIADMK) party and the Dravida Munnetra Kazhagam (DMK) party in the southern state of Tamil Nadu; the TDP and Telangana Rashtriya Samiti (TRS) party in the southern state of Andhra Pradesh, and the Janata Dal-Secular (JD-S) party in the southern state of Karnataka.

The Congress Party is hoping that it will be supported by the SP, the RJD, the Trinamool Congress party, the NCP, the DMK, and the TRS in case it emerges as the single-largest party post-elections. The JD-U, the Shiv Sena and the AIADMK, on the other hand, are likely to extend their support to the BJP-led NDA. The BSP, the BJD, the TDP, and the JD-S are expected to join the Third Front.

Most of these smaller parties, however, are keeping their options open and will formally declare their allegiances only after the results are announced on May 16.

 

Decade of Persecution

The concern of Indian Christians can be understood against the backdrop of the decade since 1998, when the BJP, under the aegis of the NDA, came into power at the federal level, marking the beginning of systematic persecution of Christians.

In January 1999, an Australian missionary, Graham Staines, and his two young sons were burned alive in Orissa’s Keonjhar district. From 2000 to 2004, around 200 anti-Christian attacks were reported each year from various parts of the nations. In March 2004, India’s second massive spate of anti-Christian attacks took place in the Jhabua district of the central state of Madhya Pradesh.

The incidence of persecution remained high despite the change of the federal government in mid-2004 – after the Congress Party-led UPA defeated the BJP-led NDA.

At least 165 anti-Christian attacks were reported in 2005, and over 130 in 2006. Including the Orissa attacks, the total number of violent anti-Christian incidents rose to over 1,000 in 2007. And 2008 turned out to be the worst year for the Christians as violence returned in Kandhamal.

“The results of the elections on May 16 will show whether the ideology of Mohandas Karamchand Gandhi, the father of the nation who promoted communal harmony, will prevail in India, or that of his killer Nathuram Godse, allegedly a member of the RSS,” said George of the GCIC.

Report from Compass Direct News