Electricity shortage jars Australia; Static felt in economy, federal-state politics

A series of blackouts and restrictions on electricity use has shattered the complacency of most Australians about the energy riches of their country.

The power shortages are occurring in midsummer here, when electricity demand is lowest. Moreover, the problems have come at a time when the various Australian states have been actively competing against one another to persuade aluminum companies to establish huge smelters that consume vast amounts of cheap electricity.

The present shortages have varying causes - breakdowns of generating equipment, coal shortages, strikes by power station operators seeking higher pay and shorter working hours, and poor planning.

Electricity supply problems are at present creating severe problems for four Australian states and for the federal government.

The federal government's concern is purely financial. It is responsible for setting borrowing limits on state power authorities. Three years ago it began encouraging the expansion of electric generating capacity by the states. But it put a sudden brake on raising loans in the past year, as part of its general economic strategy.

Several states have attempted to get around these restrictions by getting private financing for power stations through complex leasing arrangements. The federal government has now blocked that loophole, with considerable recrimination from states.

In the island state of Tasmania, problems over future supplies of electricity have caused a state premier to resign from the government and from his political party.

The state, which survives mostly on hydro power, has been looking to increase its power supply for the past two years. The cheapest and largest available supply would be another hydro project, on the Franklin River. Conservationists, however, claim building a dam would cause environmental damage.

The issue became messy. The state government tried to compromise; then the matter was put to a public referendum. The government split after the government proposal lost in the referendum, the premier resigned, and the new state government opted for the dam. But the federal government, which would finance the dam, opposes the project.

Victoria suffered severe electric shortages last winter for the first time in 20 years. The shortages were followed by stiff price hikes for consumers and commercial users.

Victoria faces a state election in four months. To regain some of its political standing, the Liberal state government has played up the fact that this summer it has been making electricity available to the Labor Party state government of New South Wales, beset by breakdowns of its largest generators. The state has blamed generator design faults and policies of previous governments.