Over 85% of the NSW Labor Party conference voted to reject a bid to privatise the state's electricity industry yesterday, in a major upset for Premier Morris Iemma and Treasurer Michael Costa.
In the lead up to the 702-107 vote against the sell-off, the Premier was heckled and booed by members of his own party.
Unions and the Greens argue that privatising the electricity industry would push up costs, lower workplace standards and make it a lot more difficult to deal with climate change.
However, the Premier maintains that rising energy consumption has forced the Government to sell-off the industry in order to build a new coal-fired power station.
Michael Costa, who has previously denied in Parliament that climate change was caused by human activities, is expected to defy the ALP resolution and introduce the legislation into Parliament regardless. Although Costa has announced that he is prepared to be sacked for his support of the sell-off, a significant minority of the ALP caucus has declared that they cannot vote against a conference resolution in Parliament. If the legislation is tabled in Parliament, it is likely to pass with the support of the Labor Right and the Liberal Party, despite opposition from Labor Left and the Greens.
Iemma and Costa won the backing of former NSW Premier Bob Carr, who has accused the ALP rank and file of being backward-looking and supporting a Soviet-style model of public ownership. Prime Minister Kevin Rudd has also supported the sell-off.
Michael Costa now has to make a decision between supporting the privatisation, borrowing money to create a new coal-fired power station, and promoting a combination of renewable baseload power and energy efficiency. The Federal Liberal party, which long shared the ALP position that only coal could provide baseload power, announced last week that it now accepts that solar thermal energy can provide baseload power for Australia.