A major report on Australia’s gas supply predicts a major shortfall next year as soaring energy prices increase the cost of living pressure on household budgets.
Treasurer Jim Chalmers said the competition watchdog’s latest gas investigation report highlights some “alarming” features of the East Coast gas market.
“It predicts a major gas shortage for next year unless gas producers supply more of their non-contract or surplus gas to the domestic market,” he said.
The Australian Competition and Consumer Commission (ACCC) report, released on Monday, said the revenue shortfall would occur in 2023 if all the excess gas produced by exporters were sent overseas.
This suggests that the shortage will occur amid growing demand and an increase in uncontracted gas, which will likely be sold abroad at higher prices.
The report said the shortfall would be worse than the situation in 2017, when the ACCC and the Australian Energy Market Operator predicted shortages the following year.
This led to the then coalition government triggering the Domestic Gas Security Mechanism process and reaching an agreement with gas exporters to make excess gas available in Australia before it was sold to the ‘foreign.
“The (ACCC) findings are deeply concerning and I urge gas producers to do the right thing for Australians,” Dr Chalmers said.
“It is essential that our domestic gas supply is secure and competitively priced, particularly when households and businesses are under extreme pressure.”
The shortfall forecast comes after coal production in New South Wales and Queensland hit record highs, putting pressure on other energy sources.
Black coal production fell to its lowest output on record in the second quarter following shutdowns of coal-fired power plants and fuel constraints, according to the Australian Energy Market Operator.
Wholesale gas prices on the East Coast more than tripled in the second quarter, rising to an average of $28.40 per gigajoule from $8.20 in the same quarter last year, the operator revealed in its report. quarterly.
The government has reserved its decision to pull its gas trigger to force exporters to set aside the resource for domestic use.
Mr Chalmers said the government took the report’s findings seriously and would respond to the ACCC’s investigation.