Albo’s energy superidiot $12Gj gas price floor is made of concrete:
Moving average electricity prices continue to rip, though spot prices have fallen in recent days with gas:
The Australian Energy Market Operator (AEMO) has been almost as unequivocal as me on gas:
Opposition Leader Peter Dutton’s plan to build seven nuclear reactors would take too long to replace ageing coal generators, the chief executive of the Australian Energy Market Operator has warned, as he backed gas as the grid’s “ultimate backstop”.
“Even on the most optimistic outlook, nuclear power won’t be ready in time for the exit of Australia’s coal-fired power stations,” AEMO’s Daniel Westerman said on Tuesday. “The imperative to replace that retiring coal generation is with us now.”
Exactly right. The only issue is where the gas will come from. There is currently no security of supply owing to the east coast gas export cartel.
Two options present themselves.
First and foremost is cheap local gas, of which there is an extraordinary abundance.
The problem is that three-quarters of it is being shipped to China. And no pollie has had the cajones to impose a regime of domestic reservation powerful enough to keep enough for ourselves.
This can be done simply by triggering the Australian Domestic Reservation Mechanism (ADGSM).
Resource Minister Mad King has proven too corrupt or gutless to do so.
A better option is to impose export levies of $6Gj on all east coast exports. This will crash the local price and collect billions in taxes currently not collected owing to corruption in the tax system.
The second path is to import gas into the east coast. This will cap the local price slightly above international prices.
It does offer the possibility of lower prices as a looming global gas glut crashes prices everywhere but it is prone to the chaos of disruptions anywhere, any time.
And it guarantees that Australia will permanently lose its cheap energy endowment advantage.
It is a very bad second-string alternative.
Saliently for the cowards of Canberra, the first option also comes with an overwhelming political windfall, as the people already know what is best:
The poll found that 75 per cent of voters supported a domestic gas reservation policy to ensure a steady supply of gas to households and businesses, with 22 per cent of people undecided and just 4 per cent opposed.
The only state with a domestic gas reservation policy is Western Australia, which introduced a policy that reserves 15 per cent of gas for domestic use in 2006. Despite warnings at the time it would hamper the industry in that state, gas exports from WA have boomed.
It is no exaggeration to say that whichever party grasps the gas nettle first will automatically win power at the next election, given that it will instantly crater energy bills, cure Australia of inflation, deliver mass rate cuts, and put the energy transformation back on track.
Yes, that’s absolutely how #$%^@& in the head Canberra is.
