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Time to focus on the tough issues in energy policy: APGA

4 August 2017 , ,

APGA has called for the end to ad hoc decision making in the energy sector following the introduction of new regulatory measures without appropriate consultation and scrutiny.

APGA Chief Executive Peter Greenwood said the new measures, which came into effect on 1 August 2017 but which were not even made available until the afternoon of that day, would do little to increase energy security or affordability which were the main problems in the sector.

“As is often the case when action is valued over evidence, this new regulation imposes an unfair burden on pipeline operators and overturns regulatory principles which apply to other infrastructure,” said Mr Greenwood.

“Policy makers simply must grapple with the real and difficult issues that plague the energy sector in Australia, and stop tinkering with small parts of the industry without sufficient consideration of the longer term consequences.

“Effective regulation replicates the effects of a competitive market.

“It should not be forgotten that these new regulations will apply to unregulated pipelines – that is, where there has been no formal analysis that regulation will deliver benefit to consumers.

“We must also question why governments pay so much attention to the cost of transporting gas when that amounts to just 8 per cent on average of a household gas bill, and tariffs haven’t changed in real terms for 15 years.

“Even if any saving is to be made from these new rules, there is no guarantee that benefits will be passed on to gas users.”

Mr Greenwood also agreed with APA Group CEO and Managing Director Mick McCormack who said in a speech in Sydney yesterday that the pipeline industry had been subjected to five major inquiries in two years at significant cost to both the industry and to taxpayers.

“As Mick points out, the focus on pipelines is puzzling when the issues in the energy sector are security, reliability and affordability, areas where the record of transmission pipelines is exemplary,” Mr Greenwood said.