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Energy users call on government to fix gas market

The EUAA, who represents many of the country’s largest gas users, has released the National Gas Strategy Discussion Paper that puts forward a range of policy and regulatory options in order to change current gas market conditions, which the group says will cause plant shutdowns and significant job losses.

“Whoever wins the upcoming federal election must make solving the gas crisis a priority before we run out of time and options,” said EUAA CEO Andrew Richards.

“It’s not too late to fix this, if we act quickly and decisively.”

The EUAA said a range of issues had caused gas prices to be 200 per cent higher than they were four years ago, including lack of genuine competition, state-based gas moratoriums and pipeline pricing issues.

The Australian Competition and Consumer Commission (ACCC) has been warning for months that high domestic gas prices will cause local industry to shut down or move away from the east coast, while companies such as Remapak and Incitec Pivot have struggled to stay afloat.

While the ACCC has consistently argued that the way to lower prices is to increase gas exploration and develop proved and probable reserves, the EUAA paper suggests options ranging from a COAG Energy Council-led market reform process through to direct government assistance and intervention.

“The EUAA acknowledges the Federal Government has taken some actions to address this situation but unfortunately it has not been enough and clearly more needs to be done,” said Mr Richards.

“While people may baulk at some of the options put forward in this discussion paper, the EUAA suggest that some different thinking is required.

“Given the gravity of the situation we need a step change in policy not more incremental changes.

“Big solutions are required to solve big problems including the potential of governments stepping in for a period of time to ensure the viability of many of our gas intensive industries such as food processing and building products manufacturing.”

Members of the EUAA include Incitec Pivot, BlueScope, Glencore and Brickworks.

The association claims its members employ more than one million Australians.

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