Public Energy Victories in Victoria and Queensland, Australia

There has been a recent shift in policy and discourse around the energy transition in Australia. State governments in particular have started to acknowledge the failure of privatisation, which occurred from the 1990s in many (but not all) Australian states.

In a recent election in the state of Victoria, traditionally Australia’s industrial heartland, the Australian Labor Party government committed to significant new policies to begin the process of reinvigorating public ownership of electricity generation. It is widely acknowledged that these policies, and the government’s commitment to substantial emission reductions, renewable energy generation and job creation were important to its landslide election victory. 

Victoria: Bringing Back SEC 

Victoria’s state-owned integrated electricity system, run by the State Electricity Commission (SEC), was privatised by a conservative government in the 1990s, when Australia’s state electricity systems were also integrated into a liberalised national market, the National Electricity Market (NEM). The NEM is a bid-stack system designed to make private investment in energy generation and distribution profitable, although some generators, particularly in Queensland, remained in public ownership. 

In Victoria, the re-elected Labor Government has begun re-establishing the SEC, and committed to cementing it in the state’s constitution to prevent future privatisation. Its initial brief will be to build 4.5GW of renewable energy generation capacity, with renewable energy targets of 65 percent by 2030 and 95 percent by 2035. The government will retain a controlling interest in ownership of new energy assets, with an invitation to industry superannuation funds (profit-to-member pension funds jointly managed by unions and employers) to co-invest. The government expects almost 60,000 new jobs, and large numbers of apprenticeships, to be created through to 2035. The government is also exploring the possibility of re-establishing a publicly-owned electricity retailer.

It should be noted that, on its own, the plan for the SEC does not fundamentally change the nature of the liberalised NEM. The SEC will be a player in a market-based national electricity system that remains focused on ensuring profitability for generation companies rather than emissions reductions or worker transition. But its scale, clear mandate to invest in the public interest, and the explicit rejection of privatisation that has accompanied the policy have contributed to a major change in the discourse around energy and the role of governments in its provision. Recent declines in investment in renewable energy, and huge increases in prices for consumers as the result of the Russian invasion of Ukraine, show that privatised, marketized energy systems don’t work. The recreation of the SEC will show that a public goods approach to electricity systems is not only possible but necessary.

Queensland: World’s First Energy Workers’ Charter

In other important news, the Queensland state government also recently made major announcements about increased investment in publicly-owned renewable energy. Accompanying this was a vitally important, nation-leading commitment to a just transition for energy sector workers, the Energy Workers' Charter. The legislated Charter includes $150m for jobs guarantees, reskilling and training opportunities, salary maintenance, voluntary redundancies, guaranteed job transfers, skills retention bonuses and the creation of a full time Renewable Energy Jobs Advocate to provide advice directly to the Minister on the implementation of the plan. Parties to the Charter are the state government, unions and power generators. 

Australia has long been a laggard when it comes to climate change at a national level. However, the recent general election victory of the Australian Labor Party (ALP)  has started to  deliver some significant improvements. More important, though, has been the work of unions to force governments to put the interests of workers at the heart of the transition – evidenced by Queensland’s Energy Workers Charter – and to push State governments to acknowledge that privatisation has been an economic, social, environmental and technical failure that has to be reversed if we are to realise the transformation of the energy system that is required to avoid catastrophic climate change. This is a lesson that needs to be communicated loudly and clearly to the advocates of liberalisation and privatisation in Africa and other parts of the global south. The Premier of Victoria, Daniel Andrews, couldn’t be clearer: “Privatisation has failed”, he said during the election campaign, “it’s failed pensioners, it’s failed families, it’s failed Victorians.”