Why Labor is dismissing the gas industry’s anger

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OPINION: The government is dismissing gas industry claims its new powers on pricing will deter investment and only create more problems and higher prices for consumers.

“Options to ensure the domestic wholesale gas market delivers for Australians,” it states matter of factly.

Except for some medium-sized manufacturing companies which have not contracted gas for next year due to shockingly high prices, most households are likely to see only modest, delayed relief despite increased funding from state and federal governments.

Now, under the new market code, the price at which contract gas is offered must be based on the assessed cost of production plus a reasonable return on capital according to the judgment of the Australian Competition and Consumer Commission. for domestic customers for far too long. So, as well as the urgency of dealing with high prices, it wants to ensure Australian users – households and businesses – don’t pay too much into the future. It dismisses claims that this amounts to nationalising a major industry while expectingMany energy customers, particularly manufacturing businesses, still welcome the government’s approach, arguing the power balance – in terms of market negotiating power – has been unfairly weighted against them.

 

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