This will, know doubt, please The Guardian’s “Aussie resources for all” fucknuts. The great Australian gas shock is building, via The Australian:
The St Vincent de Paul Society of NSW says it has given out more in energy vouchers since July 1 than in the three months of last winter as a “shocking picture” emerges of thousands of homes struggling to cope with soaring energy prices.
The charity has paid more than $400,000 in Energy Accounts Payment Assistance — individual $50 vouchers for energy bills — in the past three weeks, compared with about $360,000 in winter last year across the state.
“Last year, over 55,000 people across NSW were assisted by Vinnies with EAPA vouchers,” chief executive Jack de Groot said.
“We’re already seeing a significant increase in the number of people we’re assisting as well as the amount of assistance they are requiring … data from our members and staff distributing EAPA vouchers paints a shocking picture.”
Mr de Groot said the figures were just scraping the surface in terms of the scale of extra assistance being given to people struggling to make ends meet.
“This is a significant increase with more given out in emergency relief in one month than the whole of winter last year,’’ he said.
Recall that the major driver is the gas price:
Given gas sets the marginal cost of electricity in the NEM owing to where it sits in the wholesale electricity market bid stack. See Australian Energy Market Operator description below:
Yet on global markets, where cheap Australian gas is flooding to, we have this:
A $27 billion energy project in Canada just became the latest casualty of a worldwide glut of natural gas.
Malaysia’s Petroliam Nasional Bhd abandoned on Tuesday its plans for the Pacific Northwest LNG terminal, a plant that would have liquefied Canada’s gas and sent the fuel by tanker from the western shores of British Columbia to buyers in Asia. Petronas cited market conditions in its decision.
Thanks to a glut to rival all gluts:
This has Asian gas prices well below our own, even for our own gas.
Meanwhile, as we starve of gas thanks to the cartel, bureaucrats do nothing, via the AFR:
The Australian Competition and Consumer Commission chairman said the agency is concerned that the poor and elderly are often left on high-priced “standing offers” and the three dominant retailers have few incentives to bid keenly in the electricity market or make way for new entrants.
The Turnbull government asked the ACCC to inquire into electricity and gas affordability as retailers flagged price increases of up to 20 per cent and business users face crippling price hikes.
Mr Sims said it’s early days for the inquiries but the ACCC is looking at the problems broadly. “We are basically saying there is market power in the retailers and there is market power in the generators – how do you lower barriers to entry and what might you want to do about market power?”
Waffle. The ACCC is culpable given it allowed Shell to consolidate Arrow, reducing competition, as well as stupidly declaring gas reservation was a bad idea in its previous inquiry. Competition that the ACCC failed to protect can’t save us now. Only draconian anti-monopoly law can do it.
To wit, from Matthew Stevens:
The Australian Domestic Gas Security Mechanism (ADGSM) is another of the government’s new toys that was delivered to Canavan’s management. The ADGSM delivers the resources minister power to force gas that would be exported from Queensland back into the domestic market.
Just 24 hours before his realised he might be Italian, Canavan took the next step to deploying a weapon whose only obvious target is Adelaide’s gas-strapped LNG exporter, Santos.
On Monday, to the noisy irritation of the gas industry, Canavan started the formal process that will determine whether the domestic market will be short of gas in 2018 and, in turn, whether the government should exercise it new power to restrict exports in preference for domestic customers.
In signalling the move to DEFCON 4, Canavan suggested that the government had heard and understood the promises of the industry that the market would be fully supplied in 2018, but it just wasn’t prepared to take the gas producers at their word.
Fair enough too. Having comforted voting Australians by knitting this supply security blanket, the government would be foolish not to demonstrate its preparedness to use it.
Mind you, I am increasingly confident that, even if the review identifies a need for the powers the direct, they will never actually need to use them. The gas pipeline flows would suggest there is already an increasing volume of gas heading north-to-south and away from Gladstone as domestic pricing lures volume away from low-yielding spot LNG markets. And those flows are likely to increase substantially by year’s end as the ramp-up of the last of Gladstone’s six trains is completed.
That train is owned by the Origin-led joint venture and it is currently in a process that aims to confirm its reliability which, in turns, will see contracts triggered. To make that happen, the machine needs to run at capacity. But only 80 per cent of that capacity is contracted. So, from the moment certification is completed, the joint venture will have options over where to send the 20 per cent that is not contracted.
To lower prices to the first level of acceptability, they need to be at export net back. For spot that needs to be around $5Gj. Today it is $8.23Gj. For the more important contract volumes that needs to be about $7Gj. Today it is somewhere between $15-20Gj.
The gas cartel is a liar. Deploy the mechanism.
