Electricity Trust of South Australia
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The Electricity Trust of South Australia (ETSA) was the South Australian Government-owned monopoly electricity provider. Its controversial privatisation in 1999 was one of the most important political events in recent South Australian history.
ETSA was created by South Australian Liberal and Country League (LCL) premier Tom Playford through the nationalisation of the Adelaide Electric Supply Company in 1946. The Adelaide Electric Supply Company held a monopoly over electricity supplies in Adelaide at the time, was headquartered in London, and was controlled by a small number of the Adelaide elite. The company's refusal to cooperate with the government of the time led to the situation where it was to be compulsorily acquired. The LCL suffered a split in its ranks with regard to nationalisation, and the legislation only passed with the support of ALP and independent members of parliament.
After the State Bank collapse in the early 1990s the State was left with a huge budget defecit. At the 1997 State election, the incumbent Liberal (successor to the LCL) Olsen government pledged not to privatise ETSA. However after being re-elected and confronted with new information, including a warning from the State Auditor General, they began plans to privatise it, citing the dire financial situation of the State, as well as the introduction of the Australian National Electricity Market. With the Liberals not having the numbers in the Legislative Council, and unable to sway the Australian Democrats or independent Nick Xenophon, the legislation only passed after two Labor members, Terry Cameron and Trevor Crothers, supported the legislation and subsequently resigned from the Labor Party.
ETSA Utilities was the infrastructure entity created following privatisation and the retail operation was sold to AGL. Following the de-regulation of the State's electricity market from 1 January 2003, AGL's electricity prices (approved under the new Labor Government) increased by an average 23.7% (up 32% in the 3 month Summer peak and 22% for the rest of the year). This has been a political sorepoint for both the Labor and Liberal Parties in South Australia. Although the State's fiscal situation was substantially improved with funds derived from the sell-off, debate continued as to whether ETSA's privatisation has been to the benefit of the South Australian community. However in 2006, with a number of competing electricity retailers now in the market, many South Australian households have negotiated electricity contracts delivering reductions in price of up to 15% and substantially larger price reductions negotiated by businesses, however these still well-exceed the pre-sale supply price.
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