The Federal Government’s focus on energy price as the sole driver of new policy risks undermining the value of gas market reforms that will have a range of benefits for gas users, according to Australian Pipelines and Gas Association (APGA) CEO Steve Davies.
Speaking at the South East Asia Australia Offshore and Onshore Conference 2018 (SEAAOC) in Darwin, Mr Davies said some of the reforms – which had been developed after extensive analysis and consultation – had already been implemented and others were on the way.
“These major reforms to information disclosure and in arbitration make sure that customers can have confidence that the tariffs they pay to transport gas are reasonable,” he said.
“These are complex reforms to improve market outcomes, liquidity, flexibility and competition in gas transportation markets. Council of Australian Governments Energy Council’s Gas Market Reform Group and the Australian Energy Market Operator have worked with industry over almost two years developing and delivering them.
“And yet, they seem to be of scant importance to the government now because they are not easily translated into a price reduction, which seems to be the only measure by which reform is judged.”
Debate surrounding energy policy and gas price and supply has only intensified since the leadership spill and the abandonment of the national energy guarantee.
Mr Davies said politicians were ignoring the complexity of the issues.
“The cost of gas transportation is just 7 per cent of the cost of gas for residential users and hasn’t increased in real terms for more than a decade. There’s not a lot of reduction to be had.
“Energy policy is complex. Focusing on one element, in this case price, will never result in the multifaceted, interconnected policy required to restore confidence for energy investors and users.”