Long-term energy investment opportunities are being hindered by short-sighted political policies, according to APGA CEO Steve Davies.
Speaking in Sydney at the Australian Domestic Gas Outlook Conference, Mr Davies said new energy policies were being introduced before the market issues were fully understood.
“Our energy market, with a separate rule-maker (Australian Energy Market Commission), regulator (Australian Energy Regulator) and operator (Australian Energy Market Operator) has been structured to avoid some of the pitfalls that accompany knee-jerk political responses to the issues of the day,” he said.
“Unfortunately, the intense political focus on energy prices has short-circuited the governance arrangements and seen many new reforms lobbed in without a full consideration of the consequences.”
Recent energy policy discussion has centred on how best to lower electricity and gas prices across the domestic market, but Mr Davies said the introduction of reforms to lower prices in the short-term were harmful to future investment opportunities.
“Gas provides about as much energy to end users as electricity does. It is just not feasible to replace it with electricity,” he said.
“More investment is needed in gas, but policies aimed at reducing consumer bills in the short term are not helpful to investment in energy – of any kind.
“Governments don’t have a lot of incentive to create the kinds of policies that we need: those that encourage investment.
“After all, those polices may not realise their aims for more than five years, which could mean your political rivals get the credit for them.
“A focus on the long-term benefit to the nation on all sides of politics would be the best policy outcome for Australia’s energy sector.”
For more information visit the APGA website.
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