Small businesses and households across the Illawarra will face gas shortages or significant cost increases if action is not taken on gas supplies, according to a new report by the state’s peak business organisation, the NSW Business Chamber.
The Illawarra Business Chamber has flagged significant concerns about the report’s findings, given how energy exposed the region’s economy is, and has joined the call for urgent action on measures to put downward pressure on gas prices.
“Illawarra gas users have already seen prices triple over recent years. Poor planning and a lack of action to develop significant gas resources in this state have resulted in our members suffering the most expensive gas in mainland Australia and the least certainty with respect to gas supply security,” said Executive Director of the Illawarra Business Chamber, Adam Zarth.
“Continued upward pressure on energy prices, and natural gas in particular, exposes a number of manufacturing businesses in the Illawarra.”
“For instance Bisalloy Steel incurs around $2 million per annum in energy costs and identifies this as its major high level business risk with the greatest potential to materially impact its financial outlook.”
“At the rate of current consumption, Bisalloy could be faced with a cost premium of $148,500 when compared to an equivalent business in Queensland by 2025 if a more efficient gas supply into NSW is not approved in the short-term.”
The Illawarra Business Chamber supports calls made in the report for the NSW Government to:
1. rapidly approve the Narrabri Gas Project, subject to Planning Commission endorsement;
2. support the proposed LNG import terminals at Port Kembla and Newcastle; and
3. begin a program of upgrades to ageing gas pipeline infrastructure across the state.
“These initiatives are urgent as it will take around four years to get production to levels required to meet demand.”
“Inaction on gas and energy security is now holding the future of businesses in the Illawarra to ransom, threatening employment losses and reduced investment. Now is not the time for further reviews but a time for action to ensure NSW has energy security to power our homes, our businesses and our future,” Mr Zarth said.