Government ‘takes control of gas market’ as code starts up
The gas industry says the federal government is “taking control” of the market with its new mandatory code governing all sales of the fuel on the east coast and must now act to ensure new supply is opened up to head off looming shortfalls.
Gas producers on the east coast are expected to immediately start applying for exemptions to the wholesale price cap on Tuesday, after the government released the details on Monday of new rules for pricing gas that largely matched what it had previously flagged.
Gas producers have yet to fully assess and comment on the Code of Conduct, released on Monday morning. James Davies
As producers and buyers started to pore over the 60-page explanatory statement onthe mandatory code of conduct, manufacturers called for producers to start making more supply available, now that the long-awaited details of the rules were known.
They said producers could no longer use the uncertainty of the rules as an excuse not to offer more gas, and they now had to start supplying businesses and households with gas at a fair price.
The code includes the rules on exemptions to the wholesale price cap of $12 a gigajoule for small domestic-only producers, and sets new conditions around how gas is offered and sold in the eastern states.
In a joint statement, Climate Change and Energy Minister Chris Bowen, Minister for Resources Madeleine King and Treasurer Jim Chalmers said the code, which will come into effect on Tuesday, would “secure more gas at more reasonable prices for Australian gas users”.
They said the code was supported by a strong enforcement regime through the Australian Competition and Consumer Commission and would be reviewed in two years to ensure it remains effective.
The code has been keenly awaited
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