Forcing gas producers to sell to Australia won't 'crash' prices, King says
Burned once before on energy bill promises, the resources minister won't say what new gas reservation laws will do to wholesale gas prices, but promises they will cause downward pressure without crashing the market.
Resources Minister Madeleine King has introduced legislation to create a gas reservation scheme, aiming to create a modest domestic oversupply and prevent gas prices from crashing. The government's modelling is commercially sensitive, so the exact extent of the price reduction is not disclosed. The legislation would force gas producers to sell up to a fifth of their export-bound gas to Australia, setting a target of 110% of Australia's actual needs.
The government hopes this will lower wholesale prices, benefiting consumers and supporting renewables, manufacturing, and home heating. However, industry warns that such a scheme could make future gas projects unviable and deplete long-term supply. The gas industry fears the plan might provide a short-term price relief but undermine the commercial viability of new investments.
Written by urgent.news from ABC News AU's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
