Global gas prices continue to free-fall:
- US $2.70GJ
- Europe $7.80Gj net back
- Asia $9.80Gj net back
Except in Australia, where it comes out of the ground for $1Gj and is sold in the spot market by the East Coast Gas Cartel near Albo’s stupid $12Gj price cap:
Because gas sets the marginal cost of power, it is holding the electricity spot price at around 70% higher than it should be:
The minister responsible, Madeleine King, should be pulling the Australian Domestic Gas Security Mechanism (ADGSM) lever furiously. Demanding more gas be pumped into the local gas market at reasonable prices.
Instead, she is busy giving miners billions of dollars in relief to sustain a “soverign capacity” in nickel we don’t need, given it is as common as dirt.
What about the “sovereign capacity” for affordable energy that underpins the entire economy?
It’s not like we have an inflation problem or anything, right?
Meanwhile, the gas heroes are now trying to break WA reservation:
Western Australia’s much-vaunted domestic gas reservation policy is “no longer fit for purpose” and government intervention may be required to get gas producers back on track, a parliamentary inquiry has found.
WA’s policy of requiring 15 per cent of production from gas projects in the state to be set aside for domestic use has been credited with helping protect the state from the price and supply visibility experienced in eastern states.
However, an Economics and Industry Standing Committee’s investigation into the functioning of the domestic gas policy found that only around 8 per cent of gas reserves were being fed into local markets.
There have been warnings about WA facing gas shortages in the years ahead, despite the state being home to multiple major LNG export projects.
Tighten it immediately, or join the absolute economic losers in the East.
