The latest report released by COAG Energy Council has revealed a downward trend in wholesale prices in the east coast market in 2017, while prices in other states continue to rise.
Gas Price Trends Review 2017 found that, after increasing in 2016, wholesale gas prices for large industrial customers fell in all east coast states in 2017.
The latest expert report shows Queensland had the lowest wholesale gas prices in Australia in 2017, with industrial customers falling from 11 per cent from 2015 to 2017, while prices rose in most other states.
Queensland Minister for Natural Resources, Mines and Energy, Dr Anthony Lynham, said the trend was a positive for industrial gas users, including manufacturers, but more supply was needed.
“Queensland has been doing the heavy lifting on boosting gas supply since 2016,” Mr Lynham said.
“Gas is a feedstock as well as an energy supply, and those costs impact on employers’ ability to create jobs.
The report also highlights Canberra’s switch away from gas, according to ACT Minister for Climate Change and Sustainability, Shane Rattenbury.
“When it comes to gas, Canberrans are making a clear choice,” Mr Rattenbury said.
“The report shows a clear downward trend in household gas consumption, with the ACT way out in front of other jurisdictions in the race to reduce gas use.
“This is very good news as gas contributes significantly to greenhouse gas emissions and we are moving towards a zero net emissions territory by 2050 at the latest.”
The report showed average annual household gas consumption in Canberra dropped 22 per cent since 2010 and 13 per cent since 2015 — from 50 gigajoules in 2010 to 45 gigajoules in 2015 and 39 gigajoules in 2017.
Since 2015, this is the biggest reduction across Australia by far, with the national average being a two per cent reduction and Western Australia, the next most successful state, at three per cent.
APPEA Chief Executive, Malcolm Roberts, said the report provides a comprehensive, independent analysis of gas prices in the market.
“The report shows that the average delivered price for large industrial customers is $10.08/GJ, with the wholesale gas component of that price $9.19,” Mr Roberts said.
“As in 2015, when they last reported to COAG, the analysts advise that ‘gas prices reflect the supply and demand balance’.”
According to the report Victoria now has the most expensive wholesale gas in the market and New South Wales is almost entirely reliant on interstate supplies of gas, mostly coal seam gas from Queensland.
Mr Roberts said, “The report underlines a simple, inescapable truth – the only sustainable way to place downward pressure on gas prices and to improve energy security is more gas supply and more gas suppliers.”
