AUSTRALIA: Walk-out sparks debate on electricity market

ACADEMIC Tim Brennan, in his 2001 paper analysing “rolling blackouts, bankrupted utilities, state bail-outs and allegations of anti-competitive conduct” in the wake of the Californian energy crisis, made this observation: “Deregulating an industry, like flying an airplane, makes headlines only when there has been a crash.”

Deregulation and the questions surrounding the structure of the energy market have occupied an unfamiliar space in the headlines over the past week.


The crash? Energy One chief executive Vaughan Busby prefers to call it a near miss. Last Friday, the junior energy retailer, which has 10,000 customers, largely in NSW and Queensland, became the first casualty of high wholesale energy prices due to the drought.

The company announced it was walking away from its retailing business, declaring it “unprofitable”, saying it could make more money selling hedging contracts and developing its billing software than it could through its retail operations.

The Age