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Thieves in the night: electricity privatisation and deregulation has failed to deliver and no one ever really wanted it in the first place. In the wake of blackouts, Gridlock and Enron, is public ownership back on the agenda?

Article Excerpt
The widespread electricity blackouts in the northeastern states of the US are merely the latest in a long line of electricity crises caused by electricity privatisation and deregulation. Blackouts have been experienced from California to Buenos Aires to Auckland. They have been experienced in South Australia and predicted for New South Wales. Government bailouts of electricity companies have been necessary in California and Britain. Electricity has had to be rationed in Brazil and it has become too expensive for millions of people from India to South Africa.

Dozens of governments have embarked on the pathway to electricity deregulation and privatisation since the mid-1990s. It has become the accepted wisdom amongst governments and opinion leaders. It is referred to as 'liberalisation' by its advocates, who use the term to disguise what is in essence a massive shift of ownership and control of electricity from public to private hands, in the name of economic efficiency and in the cause of private profits.

'Liberalisation' has meant that maintenance teams that were once fully staffed have been dramatically cut, leading to frequent equipment failures. It has meant that privately owned electricity conglomerates are able to blackmail governments into bailouts and high prices with threats of blackouts. And it has meant that the planning function of electricity authorities that once ensured adequate generating reserves for times of peak demand, and kept infrastructure up to date, have been abandoned to market forces. Because of market forces, electricity prices are based, not on the cost of production, but on how desperately consumers want electricity. This has led to sky-rocketing prices whenever private companies have been able to limit supply in times of high demand.

The privatisation of electricity is not something that citizens have demanded nor wanted. In general, there has been very little public participation in electricity reform decisions and, as the consequences are observed, there have been many bitter protests against electricity privatisation. Popular uprisings have occurred in Argentina, India, Indonesia and Ghana. Protests have halted privatisation proposals in Peru, Ecuador and Paraguay. In the Dominican Republic, several people were killed during protests against blackouts imposed by privatised companies. In South Africa, thousands marched during a two-day general...

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