Pittwater Life April 2017 Issue

government and generators. I
have wanted to install a
solar system for years but
the thought of entering a
market with as many complex
variables and where the
main players are new to it
themselves always reminds
me of that saying: “If you
don’t know who the fool at
the table is it’s likely to be
you.”
The advances in battery
systems, particularly the
consumer-oriented Tesla
battery, means that investing
in a system can now largely
exclude the effect of the
government feed-in tariff,
eliminating a particular
element of sovereign
risk. The economics of it
come down to simply what a
system costs and what it can
save you. These things will
eventually do to energy what
self-managed superannuation
did to compulsory super – and
that is to provide a technically
feasible means of households
wrestling back control over
an important aspect of their
lives. This ‘I’m alright, Jack’
approach to household energy
is just another part of the
wider trend of consumers
taking back control from
what is perceived to be
dysfunctional government
policy and decision making.
But what’s happening in
the gas market? We know
that things in the national
electricity market must be
bad – so bad in fact that in
mid-March, Malcolm Turnbull
had to invoke the mighty
and holy name of the Snowy
Mountains scheme to reset
the narrative. Anyone who
watched the news on that day
could have been excused for
thinking they were watching
an episode of the ABC’s
‘Utopia’ and PR lady Rhonda
had written the script.
To help understand what’s
happened in the gas market
I turned to another branch
of the ABC, this time an
article published on March
20 by business editor Ian
Verrender. He describes the
situation as follows:
“Within the next four years,
Australia will overtake Qatar
as the world’s biggest supplier
of gas. We are sitting on vast
gas reserves. In fact, we’re
swimming in the stuff. And
yet, we face critical shortages
at home which could starve
manufacturers of fuel, see
power outages across the
eastern states and force
energy prices through the
roof while any profits that are
made will be shipped offshore.
This is a public policy fail of
epic proportions.”
Verrender argues a failure
in markets so bad (for the
Australian gas consumer)
that AGL is considering a
proposal to buy Australian
gas in Japan and ship it
back home! Successive
governments inability to
raise adequate royalties and
reserve for local use leaves
us with a problem that is
even above the pay grade
of Utopia’s Rhonda to make
disappear in spin.
Energy security and energy
policy are part of that function
of government that most of
the population would simply
assume to be under control…
you know, governed. Once
failures become apparent at
the petrol pump or quarterly
utility bills, the genie of failure
is out of the bottle for all to
see and a round of the “not
our fault chorus” won’t fix it.
These failures in policy
and planning by established
political parties are no
doubt grist to the mill for
any populist politician
or party that is going to
promise to fix this along with
road congestion and train
timetables so long as it all
involves lower immigration.
Business Life
Brian Hrnjak B Bus CPA (FPS) is a Director of GHR Accounting
Group Pty Ltd, Certified Practising Accountants. Offices at:
Suite 12, Ground Floor, 20 Bungan Street Mona Vale NSW 2103
and Shop 8, 9 – 15 Central Ave Manly NSW 2095,
Telephone: 02 9979-4300, Webs: www.ghr.com.au and
www.altre.com.au Email: brian@ghr.com.au
These comments are of a general nature only and are not
intended as a substitute for professional advice.
Celebrating 25 Years
APRIL 2017 51