Victoria is preparing to bring back the government-owned State Electricity Commission (SEC), reversing a decades-old privatisation. 

The state Labor government made an election pledge last year to spend $1 billion developing its own renewable energy assets, with tough new emissions targets expected to end coal power generation in the state by 2035.

The SEC is intended to invest directly to control renewable energy projects, including wind and solar, with a focus on some ambitious offshore wind targets.

The SEC was first created over a century ago, before being privatised during the 1990s as part of the Kennett Liberal government’s privatisation of electricity, public transport, gas and water. This was against the backdrop of the Keating privatisation era, including the float of major companies such as the Commonwealth Bank, Qantas and Telstra.

This week, Victorian Premier Daniel Andrews announced a panel of energy experts and business leaders to advise the government on its SEC revival. 

The SEC advisory panel will be chaired by John Bradley, the secretary of the Department of Energy, Environment and Climate Action. 

It also features Dr Alan Finkel - a neuroscientist and engineer who led an independent review of the security and reliability of the national electricity market requested by the Coalition of Australian Governments in 2016. He also developed Australia’s national hydrogen strategy in 2019, and was on a panel advising the 2020 Low Emissions Technology Roadmap.

Former Telstra chief executive Andrew Penn is on the advisory panel too, having stood down as Telstra CEO in March after more than seven years in the role.

They will be joined by Audrey Zibelman, the former head of the Australian Energy Market Operator (AEMO) and central figure in the ongoing transition to a decarbonised energy grid.

The SEC advisory panel also includes Climateworks Centre chief executive Anna Skarbek, a founding board director of the Clean Energy Finance Corporation (CEFC), Consumer Utilities Advocacy Centre executive director Jo Benvenuti and interim SEC chief executive Chris Miller.

The proposed SEC will take a majority stake in only renewable energy projects, with the remainder provided by private investors and industry super funds. 

The Andrews government says the SEC will be key to hitting the state’s targets of 95 per cent renewable energy by 2035 and net zero by 2045.

It also claims the SEC will drive the creation of 59,000 jobs by 2035 and increase gross state product by $9.5 billion.

Some critics see the SEC as a piece of populist policy that is likely to crowd out private investors while not bringing down power prices.

There has been some suggestion that NSW Labor may announce a similar body as the centrepiece of its energy policy ahead of the state poll on March 25.

Energy lobbies have warned the NSW government against following the Victorian decision to put more energy assets in public hands.

Sarah McNamara, CEO of the Australian Energy Council, called Victoria’s decision a “retrograde step”.

“Publicly-listed energy companies have already written off $11.5 billion of shareholder value due to market uncertainty over the past five years. This announcement has the potential to further punish shareholders - including mum and dad investors - who have invested in the transition in good faith,” she told reporters.

“Government shouldn’t need to make direct energy investments where the private sector has demonstrated it is ready and willing to do so.”