"At long last Australia has the makings of a national policy to secure the gas that local industry, households and power generators need for as long as they need it," Innes Willox, Chief Executive of the national employer association Australian Industry Group said today.
"Twenty years ago Australia's energy ministers were advised that Liquefied Natural Gas exports would transform the east coast's gas market. More than ten years ago those exports began without any gas security guarantees in place. And ever since we have been living with the consequences: higher prices and constant fears of short supply, with dire impacts on essential industries from fertiliser to bricks to food processing; and a patchwork of after-the-fact interventions that had to work around existing contracts.
"It didn't need to be that way. Western Australia has made a much better fist of reconciling a thriving gas export sector and strong local industry. The national reservation policy announced today is a strong, and long overdue, decision to extend a similar level of security to the whole of Australia.
"Contracts need to be respected. Making as-yet uncontracted gas exports contingent on adequate steps to supply the local market honours that principle while providing a strong incentive. A secure supply for local buyers is essential. A buyer's market would be even better.
"There is more work to be done to bed down the welcome policy approach announced today. The next phase of design needs to ensure that appropriate flexibilities for gas exporters don't inadvertently create loopholes that undermine domestic gas security. Australian Industry Group and our members will remain deeply engaged to ensure a workable and effective system kicks off in July 2027.
"The uses of gas are evolving but it will remain important for industrial heat, feedstocks and backup power for many years to come. The reservation model announced today is a decisive step to enable Australia's gas endowment to drive prosperity not just overseas, but in Australia too," Mr Willox said.
