The model I would propose is to have a state run company that ensures that there is enough clean energy produced for the needs of the citizens of the country. This would be done regardless of the profit motive.
And how would that be better than a electricity market?
The saved profits (of the owners) would need to be higher than additional overhead (that is often observed in state owned companies - also additional law and control instances) to get cheaper electricity for the citizens …
And of this single state owned company does not operate in the best interest of the citizens (which is sadly some thing to consider) there is no simple control mechanism (you would have to define complicated laws and consitently check) where in free market - if the difference between costs and end price is too high - anyone is free to build a power plant (nowadays even very small systems with photovoltaic) and therefore reduce market price.
The more power a single entity has the more risk is involved in my opinion - even (or especially?) if the entity is state-owned…
It would be better than a market because it would provide a necessity for the people regardless of whether it’s profitable to do so or not. Things that are necessities should be provided because they are needed not because there’s money to be made doing so.
Meanwhile, there is no actual evidence for the claims that state run companies are somehow less efficient than private ones or that there is a significant amount of additional overhead involved. And even if it was the case, which I stress is not, that wouldn’t matter. Any efficiencies created within capitalist enterprise serve to enrich the owners of the companies as opposed to being passed on to customers.
And I can give you a concrete example of this. SaksTel is a publicly owned telecom company providing internet in Canada. It provides cheaper and better service than any commercial entity here.
Meanwhile, free market directly leads to monopolies because as successful companies grow bigger it becomes harder for new players to enter the market. The incumbents leverage economies of scale, brand recognition, and vast resources available to them to muscle out competition.
Once again, I’ll use Canadian telecom space as an example where there is a cartel of three companies controlling it. This has led to having terrible service provided at some of the highest prices in the world. This is what happens when the market is allowed to “regulate” itself.
Your whole premise is at odds with the available evidence I’m afraid.
OK if it isn’t profitable the state owned company would take tax money to compensate - so in the end it is still paid by the citizens (but more evently distributed) … What’s the root cause for building the power plant is in the end not that important I think …
I agree that the overhead is a possible non-issue.
State owned company would be a monopoly from day one ( but controlled). But the risk stays that something happens with it and then there is no possibility available on short notice (because it may be impossible/illegal to even start a private power plant …
Monopoly building is a problem - but if the price is artificially driven high there should nonetheless come new players on the market (if that is not possible, we don’t have a free market and should change something (antitrust laws,…) - of course the transmission lines are a “natural monopoly” and therefore a (hopefully) trustworthy state owned company is the right thing here (for a free market, there have to be multiple parallel transmission lines which would be ridiculous).
For your telecom example: I visited the website of SaksTel and don’t really understand their plans but do I see correctly that they are charging 70CAD (~50€) for 15gb (and unlimited calls/texts) SIM only? I am from Austria and don’t know what the average for the US is but we had this prices like 20years ago … I am paying ~15€ for 17gb LTE (10GB for whole EU, including tax of 20%)… And this is an old and not quite cheap plan … I cannot compare the quality, but if you are not in a very remote area, a speed of at least 50mbit is normal … (Privately owned telecom company) – what are you paying for mobile data in the US?
Again, there is far less risk with a state monopoly than a private one. State is accountable to the people at least to some extent, while a private enterprise is fundamentally not. Given that markets favor monopolies, and especially in sectors where large investments are necessary there is no argument to be made regarding a private competitive market as being a viable alternative.
And of course, you have to compare SaskTel to prices in Canada as opposed to Austria. If you look at a map then you’ll see that Saskatchewan has an area of 651,900 km² compared to 83,871 km² of Austria. Saskatchewan is also far less densely populated. This means the cost of infrastructure is much higher.
You can look at overall pricing differences between countries here. Both US and Canada have terrible pricing.
The model I would propose is to have a state run company that ensures that there is enough clean energy produced for the needs of the citizens of the country. This would be done regardless of the profit motive.
And how would that be better than a electricity market? The saved profits (of the owners) would need to be higher than additional overhead (that is often observed in state owned companies - also additional law and control instances) to get cheaper electricity for the citizens …
And of this single state owned company does not operate in the best interest of the citizens (which is sadly some thing to consider) there is no simple control mechanism (you would have to define complicated laws and consitently check) where in free market - if the difference between costs and end price is too high - anyone is free to build a power plant (nowadays even very small systems with photovoltaic) and therefore reduce market price.
The more power a single entity has the more risk is involved in my opinion - even (or especially?) if the entity is state-owned…
It would be better than a market because it would provide a necessity for the people regardless of whether it’s profitable to do so or not. Things that are necessities should be provided because they are needed not because there’s money to be made doing so.
Meanwhile, there is no actual evidence for the claims that state run companies are somehow less efficient than private ones or that there is a significant amount of additional overhead involved. And even if it was the case, which I stress is not, that wouldn’t matter. Any efficiencies created within capitalist enterprise serve to enrich the owners of the companies as opposed to being passed on to customers.
And I can give you a concrete example of this. SaksTel is a publicly owned telecom company providing internet in Canada. It provides cheaper and better service than any commercial entity here.
Meanwhile, free market directly leads to monopolies because as successful companies grow bigger it becomes harder for new players to enter the market. The incumbents leverage economies of scale, brand recognition, and vast resources available to them to muscle out competition.
Once again, I’ll use Canadian telecom space as an example where there is a cartel of three companies controlling it. This has led to having terrible service provided at some of the highest prices in the world. This is what happens when the market is allowed to “regulate” itself.
Your whole premise is at odds with the available evidence I’m afraid.
OK if it isn’t profitable the state owned company would take tax money to compensate - so in the end it is still paid by the citizens (but more evently distributed) … What’s the root cause for building the power plant is in the end not that important I think … I agree that the overhead is a possible non-issue. State owned company would be a monopoly from day one ( but controlled). But the risk stays that something happens with it and then there is no possibility available on short notice (because it may be impossible/illegal to even start a private power plant … Monopoly building is a problem - but if the price is artificially driven high there should nonetheless come new players on the market (if that is not possible, we don’t have a free market and should change something (antitrust laws,…) - of course the transmission lines are a “natural monopoly” and therefore a (hopefully) trustworthy state owned company is the right thing here (for a free market, there have to be multiple parallel transmission lines which would be ridiculous).
For your telecom example: I visited the website of SaksTel and don’t really understand their plans but do I see correctly that they are charging 70CAD (~50€) for 15gb (and unlimited calls/texts) SIM only? I am from Austria and don’t know what the average for the US is but we had this prices like 20years ago … I am paying ~15€ for 17gb LTE (10GB for whole EU, including tax of 20%)… And this is an old and not quite cheap plan … I cannot compare the quality, but if you are not in a very remote area, a speed of at least 50mbit is normal … (Privately owned telecom company) – what are you paying for mobile data in the US?
Again, there is far less risk with a state monopoly than a private one. State is accountable to the people at least to some extent, while a private enterprise is fundamentally not. Given that markets favor monopolies, and especially in sectors where large investments are necessary there is no argument to be made regarding a private competitive market as being a viable alternative.
And of course, you have to compare SaskTel to prices in Canada as opposed to Austria. If you look at a map then you’ll see that Saskatchewan has an area of 651,900 km² compared to 83,871 km² of Austria. Saskatchewan is also far less densely populated. This means the cost of infrastructure is much higher.
You can look at overall pricing differences between countries here. Both US and Canada have terrible pricing.