Dunciad premiers risk house price crash with energy shock

This is some of the dumbest politics in the history of Australia. More stupid than different rail gauges across state boundaries. There is no reasoning behind it. It’s all economic and political downside. It appears to be capricious, mindless, and self-destructive.

Indeed, I can only conclude that NSW premiers Dominic Perrottet and QLD Premier Anastasia Palaschuk are drunk on power. Or maybe just drunk. 

Instead of cooperating with the Commonwealth to prevent an economic catastrophe in NSW, the Perrottet Government has embarked on an epic campaign of gaslighting the public:

Despite legal advice indicating the Federal Government could not proceed without forking out for compensation, Mr Kean [Energy Minister] said the Commonwealth did in fact have the authority to proceed.

“This is a national problem that requires a national solution, we can’t have every state and territory going off and doing their own thing,” Mr Kean told Sky News Australia.

“What they’ve said is they’re concerned they don’t have the powers to be able to cap coal prices, our legal advice says that they do have the powers to cap coal prices if they want to go down that path and we would obviously support them.”

“So far they’ve been consulting with themselves and unions for the past two months and I’m worried all they’re coming up with is an excuse, an excuse to do nothing,” Mr Kean said.

“It doesn’t matter how they do that, they want to talk about capping a particular commodity that’s fine, there are many methods that they could use.

“I just want them to come up with a solution and deliver on the promise they made to the Australian community.”

NSW and QLD are the two coal-dependent states. VIC has non-traded brown coal, gas, and renewables. SA is renewables and gas. TAS is all renewable. The coal cap is exclusively for QLD and NSW. They own the resources to boot.

Yet these are the two Dunciad premiers holding back their own energy solution. The price for their respective polities is immense as, without action, gas and electricity prices will roughly double again from today’s prices and add 3-4% to the CPI.

While Perottet sticks his head up the proverbial, NSW was hammered by a 25% utility bill shock in the last quarter. The first of many more:

AGL Energy will increase gas prices for east coast customers from early next year, as it and EnergyAustralia start passing through the higher costs from the global energy crunch.

The increases will intensify pressure on the federal government to detail its promised action to lower high gas prices, which have in turn stoked inflation.

AGL, which earlier publicly noted that gas prices for Victorian customers on a default offer by 22 per cent, is understood to be set to announce it will conduct an out-of-cycle increase to household and business gas bills in NSW, Queensland and South Australia.

Electricity futures are pricing disaster:

The RBA will be forced to hike rates far higher than household debt can handle triggering house price crashes large enough to threaten the financial system, and lead the QLD and NSW economies into the abyss.

What part of crashing stamp duties, GST, and wider taxes plus roaring costs do the Dunciad premiers not get? Not to mention the punishment that awaits them at the ballot box.

If the Dunciad premiers torpedo the deal then get on with this:

“I think what the Commonwealth can do is influence the price of gas,” Mr Sims told AFR Weekend.

“Some people say it doesn’t help the 50 per cent of time electricity prices are set by coal. But it would be a start to helping to bring down the price of gas.”

While a move to intervene in the coal market could involve possible compensation to NSW and Queensland for lost royalties, Mr Sims said three LNG producers operating out of Gladstone controlled 90 per cent of the east coast gas reserves.

It would help a lot. Emboldened by the Dunciad premiers, the evil gas cartel is busy ramping the gouge:

Hoist the Dunciad premiers upon their own petard.