ETSA: Sir Tom Playford’s Ghost

tom playford-anzac-parade

Natural Born Leader: Sir Tom Playford

****

Once upon a time, in a land far, far away there was a place called South Australia – and it enjoyed electricity delivered reliably and at retail prices amongst the lowest in the world (no, it wasn’t a dream).

The brainchild of agrarian socialist, Liberal Premier, Sir Thomas Playford, the Electricity Trust of South Australia (ETSA) was established with one goal – to provide cheap, reliable sparks to fuel economic growth through manufacturing, mining and industry.  And it did, with an almighty industrial bang.

South Australia became Australia’s motor manufacturing heartland (true it was, behind a wall of tariffs and subsidies – but such is the way when you’re out to build a Nation). It also nourished iron ore mines (Iron Knob and Iron Baron) which fed a huge steel mill at nearby Whyalla, that was also home to bustling shipyards, knocking out much needed Corvettes for the RAN from 1941, just as Japan entered the Second War.

In the 1970s Adelaide was home to 2 (General Motors Holden and Chrysler – taken over by Mitsubishi in 1977) of the 5 motor manufacturers building cars in Australia at the time (the others being Ford, Leyland and Nissan).  Adelaide also hosted a raft of components manufacturers, making tyres (Uniroyal – later Bridgestone), mag wheels and rims (ROH) and shock absorbers (Monroe-Wylie) – employing thousands. At their peak, Holden and Chrysler employed over 11,000 between them.

In the 1940s, Playford (Premier for 26 years from 1938 to 1965) had a gift in the form of vast untapped reserves of brown coal located at Leigh Creek, about 260 km north of Port Augusta which sits at the top of the Spencer Gulf.

Port Augusta Power Station

Port Augusta Power Station:
watt powered SA’s economic miracle in the 50s and 60s

****

Tom tried, unsuccessfully, to flog his low-grade Leigh Creek brown coal to SA’s local power generator (the Adelaide Electric Supply Company) which sniffed at Tom’s “poor” energy offering, preferring to import high-energy black coal from NSW, instead.

When his local sales effort for Leigh Creek coal failed, he tried to pitch it to his eastern States counterparts – New South Welshman and Victorians turned their noses up too – so Tom decided to utilise it himself for South Australia’s benefit (it helped that NSW’s coal miners decided to strike – shutting off supplies of black coal, which deprived his enemies of an alternative to his Leigh Creek coal – during a critical stage of his political efforts to get ETSA off the ground).

Prior to WWII, most towns and many regional centres were still being powered by diesel generators – many towns were still on ageing 32 volt systems; delivery was sporadic and the cost was high – not the stuff that industrial dreams are made of. Tom saw electricity as essential to investment and growth. So he made every effort to see that South Australians had access to power almost wherever they were: from 1946 to 1965, the proportion of South Australians connected to electricity increased from 70% to 96%.

An Adelaide Hills fruit grower and World War I veteran – who fought with honour: enlisting as a private at 19, fighting at Gallipoli and then, amongst the worst of it, in France (where he suffered a debilitating shrapnel wound) he rose through the ranks to Lieutenant – Tom was an eternal pragmatist – and never shied from a fight when it came to South Australia’s economic development.

Tom took on the Adelaide Electric Supply Company and – despite bitter opposition from within his own Liberal party – he nationalised it, forming ETSA.

No prizes for guessing the fuel source ETSA would use to power South Australian industrial growth for the next 50 years.

The Port Augusta power station kicked off in 1954 and provided cheap, reliable sparks that fuelled an immediate economic bonanza that will never be seen again.

All of that was vindication for Tom, who was rightly satisfied with his efforts: his beloved State was able to put an abundant and available resource to work and, with it, thousands of migrant workers escaping war ravaged Europe.  Tom’s active policy style provides a solid example of how farmers tend to just get things done with what ever comes to hand – and without much fuss.

Playford also set up a huge stock of affordable public housing at places like Elizabeth and Salisbury where thousands of migrant workers flocked to build new homes and new lives.  Tom encouraged a wave of migration – bringing swarms of labour from the rundown, hungry and struggling industrial centres of Northern England and Scotland to the thriving north of Adelaide.

Australian Rock Legends Cold Chisel got their start in the 1970s playing a gritty working class mix of rock and blues to West End beer-fuelled audiences in the pubs and clubs of Elizabeth – where their live-wire front man, Jimmy Barnes had settled with his parents (having moved there from Glasgow in 1961). Here’s a Chisel classic from the archives:

****

****

South Australia will never see the likes of the late 1950s to 1960s again – in terms of rapid growth in population, incomes and living standards. At the time, South Australia – a vast expanse 1/3 bigger than Texas – was considered remote from international and even national markets. Despite its geographical handicap, Playford still managed to successfully oversee a doubling in SA’s population: from around 600,000 prior to WWII to over 1.1 million when he hung up his political gloves in 1965.

Children of first generation migrants to SA during the 50s were bedazzled with cheap, abundant and high quality food – some youngsters had never eaten a banana. Their parents – having experienced war-time rationing – knew what it was like to go hungry and relished the opportunity to see that their children didn’t.  Within a few years, working class migrant households bought motor cars, gleaming fridges and washing machines for the first time – while their English and Scottish cousins continued to do it tough back home in Liverpool, Leeds and Glasgow.

Tom also built a stock of public housing for the miners who dug up the coal at Leigh Creek and for the power station workers at Port Augusta who would go on to generate power delivered to Adelaide, and all the towns and regional centres of SA on a “cost-plus” basis.  ETSA wasn’t designed to make fat margins – it was designed to provide cheap, reliable power to allow others to make the kind of profits that would (and did) attract investment and workers; and to, thereby, generate growth in incomes and better living standards.

STT’s pretty certain that if Tom knew what the clowns that pass for our political betters have done to South Australia’s energy market (and, therefore, its wider economy) in the last decade he would be turning in his grave.  The recent news about the loss of car maker Holden would have been suffered by Tom as if a mortal wound.  Although, on his watch, we doubt it would have happened.

Holden’s closure is symptomatic of the policy pygmies that pass for modern political “leaders” who have plumped for “feel-good” energy rather than what was cheap and abundant – ideological “thinking” that would have been total anathema to Tom.

Tom wouldn’t have given wind weasels any oxygen at all and would have seen through the fraud in a heartbeat.  His primary concern was with input costs to South Australian industries and household living standards – he simply wouldn’t have allowed them to end up suffering the highest electricity prices in the world (which they are now) thanks to SA’s recent rush to insanely expensive, intermittent and unreliable wind power.

In upcoming posts we’ll take a close look at what used to be the “workers’ party” – Labor – which has completely forsaken its blue-collar base in favour of inner-city trendies who wouldn’t know a Stillson from a shifting spanner – and who think the only place to raise a sweat is at their weekly Pilates class.

Anyhow, back to ETSA.

A while back we covered a story in The Advertiser in which former ETSA General Manager, Bruce Dinham had a solid crack at the manner in which Australia’s energy market is being “gamed” by wind weasels and peaking power piranhas – at the obscene expense of SA’s power punters (see this post). Bruce also had a fair bit to say about the privatisation (read break-up and fire sale) of ETSA in 1999 – and the adverse consequences that’s had on SA’s power prices ever since.

Bruce – who used to manage one of the most geographically diverse electricity grids on the planet – is back and has written a cracking open letter that tips another bucket on the infantile nonsense that is wind power.

Here’s Bruce.

WIND FARM COSTS

With the announcement that another large wind farm has been approved, this one at Keyneton near the Barossa Valley and others mooted, South Australian electricity consumers can stand-by for more increases in electricity prices. Reducing greenhouse emissions comes at a price.

The wind farm announcement has the usual misleading nonsense about how many thousands of homes would be supplied. In reality it would be none, properly. The wind only blows enough to generate electricity 30 to 40 per cent of the time. If the wind farm was the only source of electricity for those homes, they would spend a lot of time freezing in the dark.

Where would the electricity come from when the wind isn’t blowing? From conventional fuel-fired generators, of course.

But this is not only when wind isn’t blowing.

When it does blow wind is variable with gusts and calms, as any airman or sailor can tell you.

What this means is that wind farms must be backed up continuously with conventional generators or recoverable storage in order to maintain system stability and ensure that voltage and frequency are kept within the limits needed for safe and reliable operation of connected appliances and equipment. With wind farms we end up paying, through our electricity tariffs, for two lots of generators.

In this particular case in South Australia the story doesn’t end there. According to the Australian Energy Market Operator (AEMO), over the last few years the summer peak load or maximum demand (MD) in South Australia has decreased, through the effects of domestic solar installations and improved building standards. Last summer the peak or MD was 3158 MW. AEMO also says that “Average growth in MD is forecast to be relatively flat (0.0% per annum)” for the foreseeable future.

In SA at present we have about 3500 MW of generating plant installed, coal, gas and diesel, without taking into account the SA/Vic interconnector or any intermittent wind or solar, other than the already installed domestic solar. It is obvious from this that so far as SA electricity consumers are concerned, the existing 460 MW capacity of the SA/Vic interconnector is more than adequate for the foreseeable future.

This raises a question, why has a 40% increase in interconnection capacity to 650 MW, at an estimated cost of $108 million ($63 million to SA and $45 million to Vic.) been approved by AER, the energy regulator?

The main reason given is that it will enable SA wind farms to export more energy to the eastern states. It is also claimed that it will “deliver net market benefits of $190 million over the long term”.

As a long term figure, obviously based on estimates and assumptions which may or may not be realised, the $190 million must be regarded as nebulous. More importantly, however, who would benefit from the benefits? It is not likely to be SA electricity consumers, because moves have already been made to have SA electricity tariffs increased to pay for the $69 million SA component of the cost.

The main or most likely beneficiaries of any increased interconnection capacity are obviously the wind farms. Costs relating to an inter-connection capacity increase should therefore be born by them, certainly not by SA electricity consumers. To the extent that they are also using existing capacity, wind farms should be paying for that as well, for the benefit of SA electricity consumers who paid for it originally.

Bruce Dinham
Former General Manger ETSA

12 December 2013

STT says: “hats off, Bruce”.

Although, he’s far too kind when he talks about wind power generating “electricity 30 to 40 per cent of the time”.

The annualised Eastern Grid average “capacity factor” (the amount of wind power actually being generated, at any given time, as a % of total “nameplate” capacity) is around 28%. Lake Bonney 3 – near Millicent in SA’s windy Sth-East – struggles to hit a capacity factor of 23%; and its neighbours produce meaningful power a risible 25% of the time. Which means those 500,000 homes – said by wind weasels to be “powered” by wonderful “free” energy from the wind – will be sitting freezing in the dark, 75% of the time – which we could probably get used to – if only they could tell us – in advance – which 75% of the time we should have our matches and candles at the ready.

If the political “brains” don’t start listening to people like Bruce very soon, all of Sir Tom Playford’s brilliant work will simply go down the gurgler.

Lasting economic success was never built on ideology – it’s about combining labour and capital in the most productive and efficient way possible. Keeping the cost of essential inputs – like electricity – low is just good economic policy. It worked a treat for Tom Playford – and South Australians reaped the rewards.

Tom Playford might have upset his conservative colleagues with his particular brand of socialism, but there was deliberate method in every part of his policy repertoire. Tom wasn’t about subsidies for the sake of them – every public penny spent had to generate a much greater return. He controlled rents charged by the Housing Trust (that built and managed a huge stock of decent public housing) keeping them artificially low so he could keep a lid on wages growth (then, tied to productivity improvements, not union demands, as now) and, therefore, encourage further investment, jobs and growth.

Playford’s creation of ETSA wasn’t about socialism as an extension of ideology, but about ensuring cheap power was sent to every farm, factory, business and home – which in turn led to private investment, new jobs and further growth. For Tom it was simply an extension of good farming practice: plant the right seed, in the right place, at the right time and you get to enjoy a bumper summer harvest. Pragmatism personified.

Endless handouts – with no measurable return – are simply a mark of economic failure. The great Australian wind power fraud began with handouts and will end just as soon as they stop – and there will be NO measurable return.

Over the next few posts STT will look at the monumental shift within the Federal Coalition which has gone from talking about winding back the Renewable Energy Target to scrapping it outright.

When it comes to getting Australian energy policy back in order, let’s hope that the Coalition are channelling Tom Playford’s ghost – especially, that part of him that ensured a plentiful supply of cheap, reliable power – the stuff that helped Tom put South Australia firmly on the map.

Tom Playford 2

Tom Playford’s brilliant legacy – who will save it?

About stopthesethings

We are a group of citizens concerned about the rapid spread of industrial wind power generation installations across Australia.

Comments

  1. Thank you for the Playford story who was a visionary of his time. Our current lot of politicians do not know what that means, they just deliver motherhood statements in between junkets. Who will tackle the unions who have well and truly reached their used-by-date and become destructively over-powerful? Coupled with the dopey Green voters it is a dangerous mix. That between them, they each own a political party, hijacking the moral high ground on every issue. The outlook for growth is not pretty. Sadly, the likes of Tom Playford may never be seen again.

  2. Tom Playford was a great man. He put his hand up to get his state running like a well-made sewing machine, so the people gave him the ok and he did just that for the people. It is a bit different how the SA state is run now by the germ in power with his wind weasels and greentards.

    SA has some of the most expensive power on this planet, and if we don’t stop the fraudulent wind turbines they will have the rest of the Nation of Australia paying this most expensive power price in the near future.

  3. Excellent article, STT. Tom Playford was a true statesman, we do not have those any more. I can remember when ETSA constructed the power lines to our property in 1959, free of charge, now it is cheaper to provide stand alone power, than the cost of being connected to the grid.

    Being a Conservative leader, he industrialised South Australia, knowing full well that he was turning it into a Labour state, which means unions and look what they have done to it. At least he did not have any Greens to contend with.

    Bruce Dinham can see the stupidity of building more wind farms, why don’t our leaders listen to people like him who have had experience in the field?

    TCW.

Trackbacks

  1. […] upon a time SA enjoyed cheap reliable sparks and manufacturing and industry flourished there (see our post here). Now – with already crippling and escalating power costs – it’s a case of the last […]

  2. […] Tom Playford – the South Australian Premier who was ready to die in a ditch to ensure SA enjoyed the cheapest power in the World – would be turning in his grave (see our post here). […]

  3. […] And we’re even luckier to have a new Head Boy who is itching to scrap the RET so he can make, in his words, Australia: “the affordable energy capital of the world” – as it was before our energy policy was hijacked by outfits like Babcock and Brown – better known as Infigen (see our post here). […]

  4. […] A few posts back we looked at how South Australia went from economic zero to economic hero during the 1950s and 1960s – with the help of a pragmatic Adelaide Hills farmer, Sir Tom Playford. […]

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: