Pricing and decision-making in the Australian electricity, road transport and water sectors: towards sustainability?

Australia and New Zealand Society for Ecological Economics
Publication Type:
Conference Proceeding
Proceedings of the Australia and New Zealand Society for Ecological Economics Conference 2007, 2007, pp. 1 - 23
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This paper considers the way in which pricing and decision-making processes in the Australian electricity, road transport and water sectors seek to balance multiple objectives. Specifically, it examines the ways in which the principles of National Competition Policy and the economic, environmental and social dimensions of sustainability are addressed in specific decisions about energy, transport and water infrastructure. In the electricity sector, we consider the planned roll out of smart meters and decisions on retail price regulation in NSW. We also consider emissions trading proposals affecting the electricity and transport sectors and the existence of energy and transport subsidies amounting to billions of dollars per year. Finally, we consider recent water planning decisions in South-East Queensland and Sydney. Despite a rhetorical commitment to principles of cost-reflective pricing and market efficiency by Australian governments, the primary objective in many of the cases considered appears to be political self-interest. Least cost options, environmental outcomes and social justice are rarely given the attention they deserve and systematic failures in decision-making processes are evident. We suggest ways to move towards sustainability pricing and decision-making by making prices more cost-reflective, adopting specific actions to address social justice concerns, using representative, deliberative processes to engage the community in decision-making and undertaking comprehensive sustainability assessments in the electricity, road transport and water sectors
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