A report by the Institute for Energy Economics and Financial Analysis release this week argues that Australian gas producers are behaving like a cartel, and that a domestic gas reservation should be implemented to fix prices at $5 per gigajoule.
The philanthropically-funded international organisation argues that gas prices – which are tied to electricity prices – are now higher than the southeast Asian market, and that five planned import terminals are not the answer. Local prices for gas have tripled since 2014.
At $5 per gigajoule, prices would halve prices for gas-intensive users and lower household electricity prices by 27 per cent.
“This is a much healthier outlook than what is currently happening, with industry and small businesses increasingly at risk and even closing operations, unable to afford their bills,” said report author Bruce Robertson in a statement.
“The east coast of Australia is controlled by a handful of private gas companies which behave as a cartel, according to the report, setting the price and the supply of gas to the detriment of Australian consumers.
“Now that cartel wants to export Australian domestic gas, and then resell it to us domestically through five proposed import plants, at even higher prices again.”
A federal gas reservation policy is under discussion, following the Centre Alliance’s support for passing tax cuts.
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