The latest budget has given the Australian Competition and Consumer Commission a boost in funding and powers to counter high gas prices.
Gas users have described the current east coast energy crisis as ‘a perfect storm’ and ‘apocalyptic’.
The ACCC has been given a funding injection to review the voluntary code of conduct over gas supply and contract agreements for local companies, with the potential to make it mandatory and better define a reasonable offer, as the government said it is considering a “suite of regulatory interventions”.
This includes a $67 million package of reforms to modernise energy market regulation with the states and territories, increase the monitoring and oversight of gas markets and improve the functioning of the Australian Domestic Gas Security Mechanism (ADGSM), including moving to quarterly-based consideration.
The ACCC has also been asked to consider options that will improve price transparency and ensure reasonable pricing.
“The Government has asked the ACCC to examine the voluntary Code of Conduct governing Gas Supply Agreements between Gas Suppliers and Gas Customers and advise on options to improve its operation, improve price transparency and ensure reasonable pricing,” ACCC Chair Gina Cass-Gottlieb said.
“The government has also extended the ACCC’s gas inquiry role through to 2030.
“This new and extended work shows the importance of matters in this sector and the contribution the ACCC can make at a time of significant global energy pressures. We look forward to delivering on these new responsibilities, as well as our ongoing work to promote competition and fairer markets for consumers and small businesses.”
Speaking to Radio National on Thursday, Federal Treasurer Jim Chalmers said the government is considering ‘further steps’ to drive down high power prices.
“Our responsibility to the Australian people is to do what we can to not make this inflation problem worse. But we do understand that as electricity prices become a greater part of that challenge … further steps will be considered,” he said.
The former ACCC chief Rod Sims also called on the government to threaten pull the trigger on the ADGSM, which would force suppliers to reserve a certain amount of gas for Australian users.
Sims said pressure should be brought to force gas exporters to sell more energy locally at prices of less than $10 per gigajoule, as AEMO puts a wholesale price cap of $40 per gigajoule earlier this year, as prices in Victoria were set to skyrocket to $382.