Australian Electricity Reform:The Ownership Debate

Abstract

A direct and indirect change in the ownership of significant segments of the electricityindustry - from the public to the private arena - has been an accompaniment to the structural andregulatory reform of the Australian electricity industry, underway for much of the last decade. Whilethe structural and regulatory aspects of reform have engendered considerable public debate, thedebate on the various aspects of the change in ownership - its rationale, methods, and impacts - hashowever been rather narrow, largely opaque, and mostly surreptitious, confined almost exclusivelyto the immediate fiscal impacts of the sale of electricity assets. It lacks any substantive considerationof the historical, political, and philosophical underpinnings of this change, and the profound,variegated, and fundamental consequences that this change will inevitably induce in terms ofredistributing wealth in society, recasting the balance between the market and the welfare state,reorganizing the institutions of governance, realigning economic and political interests,reinterpreting of the role of the state, and indeed a rethinking on the philosophical foundations ofa civilized society. This paper provides reconnoiter of the political and philosophical connects ofthe change in the ownership of the Australian electricity industry and argues for the need to broadenthe nature of the current debate on these issues. While the review focuses on the Australian electricityindustry, the messages are relevant for other countries undertaking reform, especially developingcountries as they begin to dismantle and privatize their electricity infrastructures.