First, let me say that back in the day, we had the second most efficient electricity system in the world. Power was cheap and abundant. We got away with being one of the least energy efficient economies in the OECD because of this wealth. Not long after the market reforms, prices rose sharply and Jeanette explained what was happening. Her words are just as valid today as they were in May 1996, when she wrote:

“That act corporatised power companies, required them to make a profit, forced them to compete … and required them to charge separately for the use of their lines”, Fitzsimons said.

“The government has deliberately unleashed a pack of wild dogs into a fenced paddock. No-one should be surprised that they are now eating the lambs.

“The issue is not whether prices have gone up or down overall, but who is paying more, for what and to whom. Domestic users are paying too much because they are the only captive market, and companies are forced to use them to subsidise competitive business consumers.”

The sad drama is still playing out, despite the efforts of successive National and Labour governments tweaking around the edges of the market, both hounded by a fear of the free market ideologues. (For the record, if we had a truly free electricity market, it might work better than the horrible hybrid we have today. But I do not believe that with its size and isolation that NZ could ever have a proper free electricity market.) A BNZ economist wrote last year:

Figures showing the cost of domestic electricity has gone up five percent faster than inflation come as no surprise to a leading economist.

The Government’s Energy Data File shows residential users have had to fork out for an average 4.8% price increase, every year since 2000.’

That’s well ahead of the 1.4% increase for commercial users each year, and 2.8% for industrial users.

The reasons for the continued price rises were the same ones that Jeanette outlined above. So has anything really changed since the reforms, except that we are paying more?

I contend that there is one more significant change. Reliability. It’s gone to the dogs. Ever since we “deliberately unleashed a pack of wild dogs into a fenced paddock”, as Jeanette said, the corporate hierarchies that replaced the ECNZ bureaucracy have been eating up the lambs of our infrastructure investment.

Instead of one government department, staffed mainly with engineers with a mandate to provide safe and secure electricity to all, (paid at public service salaries), we now have five boards, CEO’s and corporate bureaucrats, mostly overpaid business people with a mandate to wring as much cash as they can out of our public assets, customers be damned.  At the risk of high-jacking my own thread, is this any way to run a railroad?

Ever since the so called reforms we have had virtually no investment in our infrastructure; neither transmission nor generation. The overpaid corporocrats were too busy stripping the gold plate off of all our existing assets, admittedly giving most of it back to the taxpayer in the form of dividends, but much of it lining the pockets of the bloated management structure of the electricity market.

The stripping out of our public assets has had a devastating affect on the reliability of our electricity system, as evidenced by the failures we have experienced continually since the reforms took place. The Herald’s article on Auckland’s current power crisis catalogues just a few of the problems we’ve had over time. There have been many more.

Isn’t it time we admit that the market reforms of the 1990s were not reforms at all but were a complete, unadulterated cock-up? I would need to see a proper case made before I call for the reconstitution of ECNZ, but I will say that further tinkering just won’t do.

Some good honest engineering, not ideologically driven reform, is definitely in order.

It’s time to put the gold plate back into our electricity system.

Russel, however,  looked at it far more carefully than I did, and his press release is here. He pointed out that the “reforms” eroded the public’s ability to participate in the process while offering nothing to enhance protections for the environment.

Gary Taylor over at the Environmental Defence Society was less circumspect, hitting out against the anti-democratic nature of the reforms:

“Overall there are a number of changes that taken together will weaken proactive planning, further limit public involvement in RMA processes and shift the balance further towards development interests. This is hardly surprising given the development bias in the membership of the TAG.

“We note that there is a second phase of RMA reform to follow. This is likely to deal with more substantive issues. It is hoped that the government will set up a more balanced and consultative process than the one it used this time,” Mr Taylor concluded.

Forest and Bird echoes the anti-democratic line, with an interesting point about how the reforms erode individual property rights:

“It will be a very sad day for the environment and our communities when only those who can afford expensive lawyers can have a say,” Forest & Bird Advocacy Manager Kevin Hackwell says. “Most of the proposed changes will make the RMA easier for very big, wealthy companies and rich individuals.”

The proposal to remove the Minister of Conservation’s powers to make decisions on restricted coastal activities is a real concern. “The Minister represents the Crown’s ownership of the coast and as the ‘owner’ the Minister should be able to have the final say,” Kevin Hackwell says. The logical next step would be to take away private landowners’ rights to say no to someone else’s proposed development on their land.

Greenpeace laments the continued destruction of our clean, green image and its affects on tourism and the economy and the environment:

“The Government seems to have forgotten that many overseas consumers won’t visit New Zealand or buy New Zealand products if they discover our clean green reputation is a con.

“In these times of economic crisis, one of our key means of survival will be our clean green brand. Weakening New Zealand’s environmental laws is counterproductive because it will leave that brand in tatters.”

Mayor Harvey of Waitakere City, glibly billing himself as “one of the country’s leading environmentalists”, (cough, cough, splutter), sums it all up better than anyone:

These changes will usher in more and better development.

Too right, Bob. Pity that National’s kind of development is not what real environmentalists are looking for.

NoRightTurn provides his usual excellent analysis, while the Property Council waxes poetic about how these anaemic changes will rescue the economy.

Kiwiblog parrots the New Zealand Herald’s blushing support of the announcement.

The Wind Energy Association, is cheering the changes that will allow some of the bigger wind projects to get through the consent process earlier. RadioNZ brought together both sides of the Project Hayes windfarm for a love fest in support of the changes.

All in all, the voices have fallen out around the lines that you would expect. Those legitimately troubled by the RMA process giving wholehearted or at least luke warm support, while those most aligned to the environment bemoaning the furhter erosion in the public’s ability to have their say. For me it is an issue of democratic participation, and I believe we are worse off for the Phase I reforms.

The Greens supported the EFA only with the promise of a wide ranging review of electoral reform, driven by a citizen’s jury to keep the politics to a minimum. That’s now history as National says it wants to start over from scratch. After all that I have learned and written about citizens’ juries, I still think it is the best way to go to get an independent, multipartisan view of a difficult topic.

While I understand the desire to make your own mark when entering government after a decade in the wilderness, throwing out an independent, sensible mechanism is a waste of time and resources.

Phew!