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Background: Owen Inquiry
In April 2007 the Iemma Government commissioned Curtin University Professor Tony Owen to report on the need for new generation capacity in NSW. The Greens, as well as a range of environmental groups, unions, and community groups questioned the terms of inquiry set for Prof Owen and the independence of the inquiry.
The report was released in September 2007, and unsurprisingly told the government exactly what it wanted to hear.
The Iemma government set up the Owen Inquiry suggesting that the state would experience a shortfall of electricity supply capacity and blackouts some time in the next ten years if a new baseload plant were not built. Baseload plants are large generators that are designed to run 24 hours a day. Baseload generations are cheap to run but expensive to build and they waste a massive amount of energy running when they aren't needed.
The government based their prediction on a report prepared by the national electricity
market operator, NEMMCO, called the 'Statement of Opportunities' (SOO).
In fact the report identified a relatively small shortfall in peak demand and stated that it could be met by better managing energy use and making businesses and homes more energy efficient.
A careful reading of the SOO report reveals that the Iemma government
fiddled the evidence to imply that NEMMCO was arguing for new baseload
plant.
The Greens have shown that new baseload capacity is not needed if this state begins to phase out inefficient electric off-peak water heating. For more information see the main anti-privatisation campaign page.
In September 2007 Prof Owen provided his report. The report argues for the privatisation of both electricity retailers and generators, and planning for a new baseload power plant. The report ignored evidence that demand-side measures, such as phasing out off-peak hot water systems and improved energy efficiency.
In a spectacular leap of logic, Professor Owen argued that the only way to attract private investment capital needed to build a baseload power station was to sell off the generators and the retailers.
While this might be good news for the investment bankers who stand to make a
fortune owning the state’s electricity industry it is bad news for the environment, and for households, the economy and electricity industry employees.
The full text of the Owen Inquiry Report is available here.
For further information:
- John Kaye: Iemma leads NSW on merry dance over base load power needs
- SMH: Regulator questions need for power plants
- ABC: Greens tout alternatives to electricity privatisation
- PIAC: Electricity supply in NSW: alternatives to privatisation (report by Institute for Sustainable Futures)
Explanation of electricity industry terms
baseload:
energy used on a constant 24 hours by seven days a week basis.
Traditionally baseload power has been provided by large coal fired
power stations that for technical and economic reasons cannot change
their outputs. The baseload demand is the overnight demand.
peak load:
the largest demand for electrical energy that usually occurs in the
early evening and on hot days in summer or very cold days in winter.
demand side measures: anything
which can be done by consumers to reduce the need to build or operate
power stations. This includes replacing electric-off peak water heating
with high efficiency gas or solar and cycling air-conditioners so that
they do not all come on at the same time.
energy efficiency: technologies and measures that reduce the amount of electricity and/or fuel required to do the same work, such as powering homes, offices and industries. (from www.nrdc.org/reference/glossary/e.asp) Examples include improved building insulation, compact fluorescent light globes and passive solar design.
