ACCC Report shows Labor’s gas moratorium has crippled supply

This week, the most recent report from the independent ACCC Gas Inquiry showed again Labor’s moratorium on conventional onshore gas exploration has meant less gas for Victoria and higher prices for households and businesses.

The ACCC estimates between 2017 and 2019, production in Queensland rose by 11 per cent. At the same time production in the Southern States (including Victoria) fell by 21 per cent, from 442PJ to 349PJ (pages 17 and 39).

Given this, the ACCC note on p 14:

The risk of a [gas] shortfall, particularly in the south, now appears even greater…

On page 17, the report notes this means Victoria may need to continue importing Queensland gas, saying:

‘[T]he supply demand balance in the south remains tight’ if new reserves are not rapidly developed, then ‘the southern states may need additional gas to flow south from Queensland.’

An unknown percentage of Queensland gas is fracked, and transportation costs add $2.63 per gigajoule to consumer prices.

The report expressly notes Victorian Labor’s failure to lift their senseless moratorium until 1 July 2021, saying even this eventual move will not fix this problem. The ACCC said that the removal of the moratorium will not create more supply for ‘several years’ (p 14).

Under Labor, Victorian gas production has fallen. Hypocritically, for a government who claims it is against fracking, this situation has led to the importation of more fracked gas transported expensively from Queensland.

Under Daniel Andrews the average market price of gas in Victoria has increase by 99.1 per cent to $7.23 a gigajoule, up from an average $3.63 a gigajoule in 2014.

Comments attributable to Shadow Minister for Energy and Renewables, Ryan Smith:

"Labor's decision to stubbornly refuse to lift their moratorium until 1 July 2021 is hitting the hip pockets of Victorians.

"To increase supply and drive down gas prices paid by Victorian families, Labor must remove their senseless gas moratorium immediately."

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