As power costs rise, the Victorian government is pressing for a national gas reservation regulation to protect Australia from future high prices.
As a result of Russia’s invasion of Ukraine, western nations have begun to refuse Russian gas supply, driving up global gas prices.
Except in Western Australia, Australia is the world’s largest exporter of liquid natural gas, but firms are not required to store it onshore.
As a result, rising worldwide costs are affecting households and companies in eastern Australia, with power bills likely to climb by up to 100% in July.
Victoria said it sought a national reservation plan ahead of a gathering of all state and territory and federal energy ministers on Wednesday.
Western Australia has been spared the brunt of high costs since it mandates gas exporters to set aside 15% of their output for local consumption.
On Wednesday, Premier Daniel Andrews told reporters outside the state legislature that a similar national program should be established.
‘What’s been consistent, certainly from me and our government, is the need for Victorian gas, Australian gas to be for Australian businesses and Australian households first.
‘That’s been my position and I’ve made that position clear to a number of PMs, including the current one.’
Mr Andrews said it was not practical for Victoria to set up its own gas reserve due to the connectivity of the network along Australia’s east coast.
‘It’s not about going it alone,’ he said.
Victorian Energy Minister Lily D’Ambrosio said Victoria was a net exporter of gas and it was a ‘myth’ the country was running out.
‘The problem has been that too much of what is produced, certainly to the north of the country, is being exported overseas,’ Ms D’Ambrosio said.
‘NSW has… been very heavily reliant on gas supply. There is a real need for a conversation around how more gas can be released domestically to be pulled into NSW.’
But Resources Minister Madeleine King said it would be complicated to introduce a as reservation rule.
‘It’s difficult to reverse engineer this after the export industry has been established, but that doesn’t mean it’s off the table,’ she said.
‘We want to encourage investment. These plants have been developed because of international investment.’
She said limiting exports would impact allies including Japan and South Korea and cause ‘difficultly filling contracts with international partners’.
Former Prime Minister Malcolm Turnbull introduced a “gas trigger” in 2017 to allow exports to be diverted to domestic supply in order to keep energy prices from rising.
Mr Andrews claimed that the system, which requires the federal government to ask the Australian Energy Market Operator whether a domestic supply crisis is expected in the future calendar year, was not the’simplest way home.’
‘There was a lot of criticism at the time that it wasn’t very streamlined, but it could be utilized now, and you could even go beyond that,’ he said.
‘It just doesn’t make sense to force our state’s families and companies to compete with the rest of the globe for something that comes out of our ground,’ says one family.
Meanwhile, while running on a plan to phase out fossil fuels to combat climate change, Anthony Albanese has stated that he is fine with using additional coal power.
The Prime Minister blamed the Coalition for Australia’s energy issue, claiming that the previous government failed to invest adequately in renewable energy and the electricity system during its nine years in power.
While the east coast sweats through a frigid winter, over a quarter of Australia’s coal-fired electricity generation is unavailable owing to planned and unforeseen outages.
With gas prices on the rise and energy bills on the rise, Resources Minister Madeleine King called on coal power plants to increase their output as quickly as possible on Tuesday.
Mr Albanese, speaking in Darwin on his way back from a trip to Indonesia, disputed that this move went against his high climate goals.
When asked if he is “uncomfortable” with relying on more coal power, Prime Minister Justin Trudeau responded, “Not at all,” later adding, “Coal is part of our mix right now.”
Coal accounts for over 60% of Australia’s electricity, with renewables accounting for 32% and gas accounting for 8%.
Labor claims that supplying 82 percent of electricity from cheaper renewable sources by 2030 will save households $275 per year by 2025 and $378 by 2030.
Mr Albanese acknowledged that foreign forces such as Russia’s invasion of Ukraine are driving up energy prices, but he claimed that Australia is worse prepared to handle the shock because of the Coalition’s energy policy.
‘One of the issues that has arisen here is a failure of investment,’ he said, citing the prior government’s 22 energy initiatives, of which just one was implemented.
‘You don’t have a grid suited for the twenty-first century.’
The Australian Energy Market Operator has identified $20 billion in grid upgrades that Labor’s Rewiring the Nation programme will bring forward.