Re: [OPE] Electricity problems

From: Alejandro Agafonow <>
Date: Mon Oct 27 2008 - 06:07:59 EDT

Paul C.: “A consequence is that electricity prices, which are set by short term criteria have risen to around 30p per kwh although production prices are closer to 10p per kw by international estimates.”   This a consequence of the criterion through which capitalist market operates, i.e. widening as much as possible the difference between marginal costs and prices.   But the mandatory price mechanism of Market Socialism keeps this difference as small as possible. This kind of services, usually characterized by decreasing costs to scale, could be expanded and priced according to marginal costs in a two-part tariff. The benefits for the consumers are evident. They are going to pay lower prices as far as the scale of production expands.   Since in my “two-level solution” the managers are going to be rewarded according to the scale of the service delivered instead of profits, a margin of excess capacity politically ascertained could be irrelevant.   But arises another problem with services particularly sensitive to environmental constraints. Since consumers are going to pay lower prices they are going to be willing to waste electricity, leaving bulbs, computers, TV’s, etc. on!   Regards,A. Agafonow ________________________________ De: Paul Cockshott <> Para: Outline on Political Economy mailing list <> Enviado: domingo, 26 de octubre, 2008 22:24:19 Asunto: Re: [OPE] Electricity problems Quoting Jurriaan Bendien <>: > SAN FELIX, Venezuela (Reuters) - Despite having some of the world's largest > energy reserves, Venezuela is increasingly struggling to maintain basic > electrical service, a growing challenge for leftist President Hugo Chavez. > The OPEC nation has suffered three nationwide blackouts this year, and > chronic power shortages have sparked protests from the western Andean > highlands to San Felix, a city of mostly poor industrial workers in the > sweltering south. Shoddy electrical service is now one of Venezuelans' top > concerns, according to a recent poll, and may be a factor in elections next > month for governors and mayors in which Chavez allies are expected to lose > key posts, in part on complaints of poor services. The problem suggests that > Chavez, with his ambitious international alliances and promises to end > capitalism, risks alienating supporters by failing to focus on basic issues > like electricity, trash collection and law enforcement. The BBC this evening report that as a result of electricity privatisation the margin of excess capacity this winter in Britain is about 800 Mw, or around 1.5% of demand. We production was centrally planned by the state the safety margin was typically 20%. A consequence is that electricity prices, which are set by short term criteria have risen to around 30p per kwh although production prices are closer to 10p per kw by international estimates. There is a high probablilty of power shortages occuring, or alternatively of prices beeing bid up so high that pensioners, the poor on pre pay meters etc, just get cut off to make supply and demand meet. A pretty devastating record, which clearly shows the superiority of state planning. > > > Meanwhile in New Zealand, the Premier. Mrs Clark, complained that the > directors of one of the companies in the privatized system got huge pay > increases for what is a parttime job although power charges are rising 10-12% > > > J. > > > > > Paul Cockshott ---------------------------------------------------------------- This message was sent using IMP, the Internet Messaging Program. _______________________________________________ ope mailing list

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