PERTH – Gas producer Senex Energy has called on the federal government to re-think intervention plans, warning that it could drive away investment in the Australian gas sector and could risk electricity shortages.said the company believed the government’s rushed intervention from December 2022 failed to deliver the key criteria it was designed to meet.
The Australian Parliament at the end of last year hastily passed the government’s Energy Relief package, which will put an initial 12-month cap on coal and gas prices as the government tries to rein in skyrocketing energy prices. The code will apply to contracts between gas producers and their customers in the east coast market, and the government will undertake consultation on the scope of the code and whether it should be expanded to wholesale contracts sold by other market participants. The ACCC will continue to closely monitor and report on the behaviour of all market participants, including energy retailers, and take enforcement action where required to ensure competition across the market.
“Natural gas is a critical firming fuel in electricity generation and an essential input for manufacturing where there are currently no viable alternatives. Following the passing of the gas market intervention legislation in December 2022, this investment is now on hold pending finalisation of this consultation.
Senex’s EOI process demonstrates there is no market failure for gas supply from 2025 and therefore no case for heavy-handed and enduring market intervention.