The Federal Government has announced a new domestic gas reservation scheme that will require exporters to keep the equivalent of 20 per cent of gas exports onshore, in a move aimed at strengthening energy security and easing pressure on local supply.
The government argues the reservation will put strong lower domestic gas prices, shield our industry and households from global price volatility, and ensure Australia’s energy security by avoiding potential gas supply shortfalls.
The government also said its support for Australian manufacturing under its Made in Australia campaign meant the reserve was critical in ensuring supply for industries that could not electrify.
The reserve also aims to avoid possible gas shortages in New South Wales and Victoria, as supplies from traditional sources such as the Gippsland basin off the coast of Victoria decline from 2030.
Western Australia has had its own 15 per cent gas reserve for domestic use since 2006.
But the government’s arrangement will exempt export contracts entered into before the announcement on 22 December 2025, ensuring exporters can continue to meet their full export commitments.
“Gas has an important role to play in our energy system as we transition towards 82 per cent renewables. Unlike coal, gas power generators can be turned on and off in a couple of minutes – providing the ultimate backstop in our energy grid,” the government noted in a release.
“This landmark reform will give gas producers and gas users the certainty they need to invest and enter long-term contracts underpinning domestic manufacturing. That investment leads to jobs and energy security for more Australians.”
Minister for Climate Change and Energy, Chris Bowen says the policy was part of the government’s approach to ensuring energy security and sovereignty for Australia.
“We’ve been acting to shield Australians from global energy shocks by investing in reliable, sovereign renewables and keeping more of the gas we need onshore,” Bowen said in a statement.
“Our sensible, practical policies mean we will avoid gas shortfalls and will be able to protect consumers from global energy price spikes.
“The outcome follows extensive consultations with the industry and international stakeholders and means Australians can have confidence that they will be able to access long term and plentiful supplies of affordable gas.”
