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Geoff Bertram on single-buyer for electricity

Written By: - Date published: 12:21 pm, February 6th, 2014 - 28 comments
Categories: cost of living, energy - Tags:

Geoff Bertram will analyse prospects for the proposed single-buyer model for electricity on Tuesday 11 February in Wellington. Bertram has previously set out his views on excessive power prices rise for consumers to the Fabian Society and elsewhere.  They are also covered in his chapter in the book Electricity Market Reform: an international perspective presented to an international forum in Germany last year.

This prompted the Government’s Electricity Authority to produce a report last week attacking Bertram’s analysis. Yesterday at a press conference the Authority’s Chief Executive Carl Hansen went further and resorted to a very personal attack on Geoff Bertram. Today’s DomPost reports (not on-line):

Bertram had claimed last year that power ‘consumers had been rorted for a long time’ and that ‘real prices’ for power had doubled since 1985. Last week the Authority issued its own research which it claimed to debunk Bertram’s claims.

At the press conference Hansen went on to attack media commentators, singling out Bertram. ‘He isn’t a very careful analyst. He is often portrayed in the media as a professor. He was never a professor and he was never an economist. He was a geographer. I think it [Bertram’s research] is showing his lack of technical ability.’

When they go personal it shows they are losing it (and the argument). Geoff Bertram is certainly an economist – he has a D.Phil in economics from Oxford University and taught economics at Victoria for 35 years. The chapter which provoked the Electricity Authority was presented to an international forum in Germany last year.

The Authority’s report has also come under one of the most scathing analyses I have seen from the experienced business journalist Tim Hunter in his Chalkie  column earlier in the week. Hunter called the Authority’s report “clever fallacious and deceptive – in other words sophistry”, and went on to say

” Chalkie reckons what we have here is an attempt to justify the huge price rises for households in a politically led effort to discredit the Labour/Green policy. But the upshot is that the authority has discredited itself.

Which makes Geoff’s Fabian presentation on the single buyer policy idea all the more timely. All are welcome to attend  – if you would like to come please register here.

28 comments on “Geoff Bertram on single-buyer for electricity”

  1. srylands 1

    Look this guy has zero credibility. Carl Hansen is a brilliant economist by comparison – he worked at the Treasury.

    Bertram advocated that no worker should paid more than 3 times the lowest wage of any worker in a company, and if they did, should be banned from any government tenders. That says it all.

    The “single buyer” policy will NEVER see the light of day, regardless of the outcome of the next election.

    • One Anonymous Bloke 1.1

      Brilliant economists working at Treasury. 😆

      You can see how credible Hansen is for yourself: he helped design the electricity market failure and has also worked as an enabler for the Business Round Table.

      Partisan hack.

      • Paul 1.1.1

        Bertram has zero credibility for you.
        Well that makes his viewpoint more credible.

      • veutoviper 1.1.2

        I think that s rylands probably knows Hansen’s employment history and background well. And isn’t everyone who has worked for Treasury brilliant? In their minds anyway. (And, to give credit where it is due, I have known a few that were/are; but IMO they tended to be the exception to the rule)

        For others, Hansen’s employment record from Linked In includes being a senior analyst for the NZ Roundtable (1990 – 1992) , Treasury (1996 – 2000) , LECG (2000-02), CEO M-co NZ Ltd ( 2002-09) and then Director Peloris Ltd (2009-10) before becoming CEO of the Electricity Authority.

        EDIT – oops, that should have read Director Paradox Ltd, not Director Peloris Ltd.

    • geoff 1.2

      Look this guy has zero credibility. — srylands

      nuff said.

    • Will@Welly 1.3

      Brill English “worked” at Treasury. Stellar career included one-time leader of the National Party.
      Other notables have seen their policies completely miss the mark. In fact since the neo-liberal experimentation begun, have any of their policies been “right”, other than “right-wing”.
      Failed English theorist/terrorist/oppressor of the poor – Greggor Mal-cluoff – now leads Treasury. His advice is the same as that, that has emanated out of their doors for the past 30 years – sell everything, and cut wages to the poorest, then trim benefits further. And please don’t touch my salary.

    • Ant 1.4

      “Look this guy has zero credibility. Carl Hansen is a brilliant economist by comparison – he worked at the Treasury.”

      LOL

    • Poission 1.5

      “Look this guy has zero credibility. Carl Hansen is a brilliant economist by comparison – he worked at the Treasury.”

      Treasury have shown their level of skill with their forecast modelling,They are obviously very bad at forecasting (especially about the future) hence they have little too add about the underlying qualitative attributes of the data.

      http://www.treasury.govt.nz/budget/forecasts/befu2007/06.htm

    • Ross 1.6

      Didn’t srylands also work at Treasury? Strange that he or she forgot to mention that. 🙂

  2. Chooky 2

    @srylands……you have to be joking….”Carl Hansen is a brilliant economist by comparison – he worked at the Treasury”

    ….working for New Zealand Treasury is no recommendation…in fact it is the opposite ….most of the time they are either naive and gullible or bought…imo .

    Bertram always made a lot of sense to ordinary NZers with ordinary requirements for electricity …as does Molly Mellich

  3. Philj 3

    Xox
    The speed of your response gives you away, srylands. Brilliant economists and money changers largely got us into this mess, along with marketers. JK was a money changer, still is. Geoff Bertram makes much more sense in the real world that most of us live in. Is this the ‘brilliant’ Treasury economist telling us we have been paying too little for our electricity!? Brilliant comedian more like it. Treasury is suspect imo.

  4. Philj 4

    Xox
    Doesn’t reflect too well on the credibility of the Government Electricity Authority when their spokesman doesn’t have clue, eh? Explains a lot.

  5. Philj 5

    Xox
    Geoff Bertram also has a good video on Ziln explaining the electricity rort in detail, about 45minutes.

  6. geoff 6

    Electricity, food, mortgage/rent, low wages.
    These are the four main ways kiwis are getting ripped off by interests that the National party represents.

  7. hoom 7

    Don’t forget Bertrams’ own response to the EA report http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=11193859

    The EA report is utterly laughable due to completely nonsense assumptions then ignoring very obvious facts that show up on their graphs.

    eg from the above linked Chalkie article (OMG I agree with Chalkie about something?!)
    “Applying the average generation cost across a model of consumer types came up with the answer that residential consumers were paying considerably more than cost, while industrial consumer were paying below cost. Woops, wrong answer. ”

    Interesting that Chalkie links current EA boss with NZIER who were used as consultants.

    Frankly these actions & particularly this report prove he is a perfect example of Regulatory Capture & needs to be removed from that position ASAP.

    • veutoviper 7.1

      Bertrams’ response is well worth reading – as are the over 100 comments (sorted by the most liked) even though comments are now closed as pointed out by philj at 7* below.

      * should read 8.

  8. Philj 8

    Xox
    HERALD
    Debate on this article is now
    closed.
    Haha. Too hot to handle Granny Herald?
    The Government has the power to change the system. Is it prepared to use it for the public good? Hmmm…

  9. Blink 9

    Looks like grid-parity will happen quicker than expected.
    What’s the price of PV these days?

  10. fisiani 10

    Nationalising the electricity supply has not worked out for North Korea. Why does anyone think it would work here? No more investment by power companies . What would be the point. Power outages and blackouts that would inevitably follow will not help the economy. Dumb idea.

    • McFlock 10.1

      indeed. Auckland, for example, has never had a blackout…

    • Flip 10.2

      “Nationalising the electricity supply…”

      This is not what is promoted. A single buyer of supply is not nationalisation. Supply competition remains. Read the article before you leap to your prejudices.

    • One Anonymous Bloke 10.3

      Earth to Fisi. If the electricity supply were nationalised, the “nation” would be the investors.

      • mikesh 10.3.1

        The nation WERE the investors. Nationalization would simply restore the status quo ante.

  11. captain hook 11

    the so called market for electricity is nothing but another deal that was cooked up by the National Party to parcel out the States assets to its mates. There was nothing wrong with the system until national got hold of it. The same thing ahppened in the US and resulted in the ENRON scandal and the staff nearly singking the Wall St Journal and allowing it to be sold off to Rupert.
    Itsa ll a load of shite but the neo-libs keep getting away with it.

  12. Draco T Bastard 12

    Excellent article by Chris Trotter:

    Hence the near panic induced by Geoff Bertram’s analysis of New Zealand’s energy sector in which he sharply criticises the three-decades-worth of price-gouging engaged in by both the publicly- and privately-owned energy companies. So effective was Bertram’s critique that, Carl Hansen, the newly appointed head of the Energy Authority felt obliged to commission a thorough-going rebuttal of the Wellington economist’s research.
    Hearing Bertram deconstruct Hansen’s rebuttal was a true delight. Never before have the absurd assumptions of neoliberal economics been so ruthlessly exposed. Hansen’s understanding of the world appeared to be based on nothing more than the crudest of a priori reasoning. He simply couldn’t conceive of a world driven by ideas and values that had nothing to do with the “weighted average cost of capital” and everything to do with building a nation.

    Ideas do matter and it’s becoming obvious that we need a new idea to replace the failed neo-liberal and capitalist system.

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