Alinta Gas and Other Hot Air

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Lead’s Lessons Lost

According to the Editorial in The West of 4 Jan 2011: “One of those lessons [for the Barnett government] must surely be the importance of assuring the public that strict control is being maintained over the export of lead through WA ports.”

I would hope for an even more important lesson:

Actually maintain strict control.

Theatre of the Absurd

Bill Proude of Mt Lawley wrote to The West: “How can a bloke take a girl to the theatre without being able to offer her a drink during the intervals?” (4 Jan 2011)

How, indeed?

How can you expect to get laid, if you can’t get her pissed at the play? Poor Bill Proude.

Still, not to worry! I understand that the bar will, in fact, be open at intervals. At the half-way mark between performances, that is. The bar will be closed when there is no performance.

So Bill can still boost his own chances to perform. Especially if there are more and longer intervals. It’s always easier to get lucky with an unconscious bird, eh Bill? Nudge, nudge.

Wink, wink.

Alinta Welcomes Competition

Competition is good for us. It lowers the price to the consumer. That must be true. The government and Alinta say so.

They’re right, of course. Here’s how it works:

Charge $1 per unit. No-one’s interested in competing because $1 per unit will not make them a profit. Especially not if they need to spend a lot of money just to get started.

Raise prices to $2 per unit. Alinta will make huge profits.

Alinta’s huge profits look good. A competitor joins the market. Selling gas at $2 per unit, the new competitor can cover start-up costs and still make a big enough profit.

Now there are two companies, each selling gas at $2 per unit. The public -- us, the gas consumers -- are upset. The two companies want to steal each others customers. The government enforces competitive pricing.

So Alinta drops its price to $1.80 per unit. Drops its price because there is a competitor in the market! Alinta still makes more profit than before.

The new competitor has to win customers. They drop their gas price to $1.75 per unit. They gain a few customers. They make a handsome profit.

All this competition has forced gas prices down!

Unfortunately, prices were jumped up to start with -- to allow for competition!

In order to ensure that there is a competitive market... the consumer pays more for gas.

Good grief.

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