Even Gotti can see the energy crisis fix

From Gotti today:

We should incentivise those with emergency capacity to switch on their power generators as those days approach so they do not drain the grid on the blackout days.

And we should encourage Australian households and commercial enterprises to install diesel power, solar panels and /or batteries so that they too are not a drain on the grid on vulnerable days.

Again there should be an incentive and these actions would become part of the long-term plan.

…I am afraid we need to get tough on gas. Opposition Leader Bill Shorten has made some strong statements about gas and the Prime Minister needs to meet with him and together set out a gas policy which will inevitably involve garnishing say five per cent of our gas output on the eastern sea board for domestic use. A reasonable price will need to be paid but not an excessive one. This will also curb electricity price rises because gas costs are a key element in power rises. In a crisis surely we can expect our two leaders to reach agreement and I believe both are headed in the same direction anyway.

…The interconnection of distribution and generation between states makes it impossible to solve the problem longer term on a state-by-state basis. Realistically, states will not give up powers so I suggest a carrot that would also slash wastage. The commonwealth should delegate most infrastructure spending decisions to the states and end this crazy game where the commonwealth and the states second-guess each other all the time. Each state should have a fixed amount from the Commonwealth to spend on infrastructure at their discretion.

…The central energy controlling authority that takes control should report to a policy body where the commonwealth has the majority but the states have representation. But the controlling body must be dominated by the best world engineers in electricity and gas — not public servants or politicians.

Far more complex than what is needed but along the right lines and kudos for writing about it.

The truth is the fixes are preposterously easy:

  • bad third party gas exports to crush the GLNG gouge;
  • install use it or lose laws to force the development of Arrow gas and domestic reservation to prevent it going offshore;
  • put in a carbon price so that renewable and storage installation accelerates.

That’s it. Energy crisis fixed short and long term, with a functional market to deliver lowest cost outcomes for households and industry, plus Australian decarbonisation tracking with the best of them and the Australian gas export industry booming.

Everything else is basically hot air.


  1. Jake GittesMEMBER

    So much free advice coming from everywhere and Turnbull Frydenberg et al heed the perpetrator.

  2. Yes, fixing the gas market might fix the immediate crisis, but Gotti has touched on a solution to a bigger, undiscussed issue. Those backup generators will provide resiliency to other problems.

    I’ve been quite unpopular with my friends in my view that energy security and business continuity are the responsibility of individual businesses and households but everyone wants the government to ensure that they have 100% reliable utilities. Our society has become too complacent and exposed to interruptions to supply of electricity, fuel, food, water, telecoms, etc. These blackouts have shown just how un-resilient and needy we now are. Such a departure from the historical Australian character. Cyber attacks will expose just how weak we are.

    Business continuity is a cost of business and not a social service to be provided or cared about by government. Anyone that needs it can install their own capacity, just as all IT departments know they already have to. Govt policy should be focussed on facilitating low costs and low externalities, as these are the outcomes that provide the broadest social good. 100% reliability is gold-plating for a large part of the community or socialising the cost of benefits that accrue to a minority.

  3. HadronCollision

    I love how more CSG not even mentioned by gotti and MB now.

    Why? Not needed + tramples private property rights