Essay by Eric Worrall
More expropriation of Aussie fossil fuel assets. Hands up who plans to invest in the Aussie energy market?
Perrottet gives himself dictator-like powers over coal
Aaron PatrickSenior correspondent
Updated Dec 21, 2022 – 4.16pm,first published at 4.01pm
If Dominic Perrottet decides there’s a coal emergency, an emergency there is.
And in such an emergency, the NSW Premier will have powers over the state’s black coal that might cause a Chinese central planner to blush.
Changes to the Energy and Utilities Administration law passed on Wednesday give his Energy Minister the power to set maximum prices, decide who coal will be sold to, and control the use of the coal, for any period. In other words, the government can seize control of the whole market.
The law’s self-declared objective “is to put downward pressure on electricity prices during coal market price emergencies by allowing for the giving of directions in relation to the price and domestic supply of coal used to generate energy”.
…Read more (paywalled): https://www.afr.com/companies/energy/perrottet-gives-himself-dictator-like-powers-over-coal-20221221-p5c81u
The most shocking part of this act of expropriation is the state of New South Wales has an allegedly Conservative government – Dominick Perrottet is a Liberal. You normally expect this kind of behaviour from radical socialists, not a party which claims they support freedom and minimal interference in people’s lives.
But they are a Conservative state government which has bitten deeply into the poison green apple.
I guess the lesson is, don’t believe everything you read on the tin.
I’m not sure what the Liberals think passing such laws will do to coal investment in New South Wales. Even if the powers are never exercised, the threat of expropriation will undermine confidence and have a chilling effect on investment.
Who in their right mind will put money into new NSW coal projects, when the government has just granted themselves the right to seize control of your product, break your contracts without compensation, and redirect supplies to whomever they choose at the price they set? The only rational behaviour in such circumstances is to run the existing mines and facilities into the ground, and get your money out of the state as quickly as possible, before the government expropriates your business and ruins you.
Update (EW): The previous expropriations I can recall were threats of retrospective export controls on natural gas, and the suspension of the national energy market. Both events happened earlier this year.