Comment of the week

Our comment of the week is from Liz Aitken who shows how best to deal with angry posts from those that think the carbon price caused SA's high electricity pool prices last week, as well as being communism by stealth.

Some commenters on this website have a wonderfully calm and patient way of engaging with some of the angrier posts we seem to receive from those determined to believe the carbon price is communism in disguise that will ruin life as we know it.

On Friday last week in Climate Spectator we reflected on how life seemed to be going on smoothly one week after the introduction of the carbon price, to which we received this rather angry reply:

Now that we have had an operational carbon tax for one week, we can view the electricity price changes that have been locked in. Real-world data is available at . This shows that average prices in SA (for example) were around $30 per MWh in the last week of June, and are now $90 for the first week of July.

Aren't facts awesome? Kind of stifles the "debate" though because now you can't feign ignorance. Being green is great but it costs money. And taking money from one group of citizens to "compensate" others for this is socialism, not environmentalism.

Liz Aitken then calmly responded in a way much like a concerned school teacher trying to help a misguided youth with this wonderful comment,

Hi Ben,

I suggest that if you are interested in the underlying causes of last week's energy prices you go to this blog.

Tristan is correct in pointing out that the market is extremely volatile, and the high weekly averages you are talking about derive from 1 day: Monday 2nd July.

I do not know if you are aware, but there is a bit of a supply shortage at the moment as Yallourn is still operating at limited output as a result of their flooded mine, and NEM-wide demand is firm (though not spectacular) as it is winter.

In addition, Basslink fell off on the Monday and there was no wind blowing in SA at all that day. There was an issue with transmission at Dedarang which required limiting of interconnector flows from NSW.  All of these things contributed to an extremely volatile , and ultimately high price day across the NEM.

This information is also all available on the AEMO website, though it is difficult to find if you have no experience in looking for it.

Yes, it is expected that there will be a lift in energy price, and early indications are that the underlying price has risen by between $18 and $28, exactly the amount foreshadowed by the $23/tonne price.


InvestSMART FORUM: Come and meet the team

We're loading up the van and going on tour from April to June, with events on the NSW central & north coast, the QLD mid-north coast and in Perth, Adelaide, Melbourne, Sydney and Canberra. Come and meet the team and take home simple strategies that you can use to build an investment portfolio to weather any storm. Book your spot here.

Want access to our latest research and new buy ideas?

Start a free 15 day trial and gain access to our research, recommendations and market-beating model portfolios.

Sign up for free

Related Articles