5 minutes with Cameron O’Reilly

Membership of the Energy Retailers’ Association of Australia (ERAA) is comprised of businesses operating predominantly in retail electricity and gas markets in South Australia, Victoria, New South Wales, the Australian Capital Territory, Queensland and Tasmania.

As the representative of gas retailers, Mr O’Reilly’s interest in gas and gas markets arises from its importance in Victoria, where vigorous competition has been able to be achieved in an environment where most consumers have electricity and gas accounts. He believes that gas will play a bigger role in Australia’s stationary energy industry in the future.

The top two steps the gas industry needs to take to survive in a carbon constrained economy…

Rather than a survival challenge, the industry faces the challenge of managing growth. In Australia, gas will benefit from a carbon constrained economy given the much lower emissions of gas-fired generation in relation to coal. Then there is the export potential of gas as LNG.

The greatest achievement of the gas retail industry in the past five years…

The fact that Victoria has progressively phased out retail price regulation without a major consumer backlash is proof that educated consumers are willing to take responsibility for energy decisions, including negotiating with their gas and electricity provider. The industry played a successful role in achieving this change of mindset.

In the short and long term…

Evidence suggests the gas sector will become increasingly influenced by global prices and developments through LNG, which could present some educational challenges with domestic consumers. I also see that the incredible growth of non-conventional gas such as coal seam gas and shale gas will improve our gas reserve situation and allow planners to build gas into Australia’s long-term energy planning decisions.

The top two government incentives/policy measures you would like to see implemented today...

I’m not one who favours government interventions in markets, especially when you see the evidence of the distorting impacts of constant government policy changes in the renewables sector. Most people still believe that any future climate change policy has to be built around a price on carbon, and that intervention in pricing the externality of greenhouse gases will be enough to ensure a bright future for gas.

ERAA’s view of new projects and technology…

ERAA is mainly a public policy advocacy body, but one reason we are in favour of competition-based retail markets is that they are more likely to produce innovation. I think the reality of a long-term upward trend in retail energy prices will see more product offers that help consumers to manage their demand.

The one piece of advice you would give new entrants to the gas industry…

Be mindful that in the future our gas industry will be more globally linked, including in pricing. Also, any new gas retailer has to really learn how wholesale markets work and get across developments like the short-term trading market. You can’t retail gas unless you can get it competitively from the wholesale market.

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