NSW Govt rejects plan to cut power bills by stashing gas
A PUSH for a nation-wide gas reservation policy to keep down domestic energy prices has been rejected in NSW.
The Baird Government has dismissed a parliamentary inquiry finding that hoarding a set amount of Australian-produced gas would drive down prices at home while companies continued exporting at higher prices.
In its response, the government said it would be unable to compel other states and territories to supply NSW with the gas they produced.
"A gas reservation policy would also restrict trade, discourage investment and cause development costs in NSW to rise," it said.
The inquiry in February found NSW gas prices would triple without government intervention due to a booming Asian export market with prices well above those at home.
Wholesale prices in NSW were historically about $3 to $4 per gigajoule, while Asian prices were sitting around $15.
As a state that imports 95% of its gas, the shift towards exports is expected to have a major impact on NSW.
The NSW Government accepted the inquiry's three remaining recommendations, including seeking for the amount of gas available to be purchased nationally to be published on the National Gas Bulletin Board.
It will also undertake an audit of all regulatory tools available to the NSW Government to "improve transparency and openness".
Finally, it has promised not to expand the CSG industry at all until the NSW Chief Scientist's 16 recommendations to deliver world's best practice regulation of the industry have been implemented.
- APN NEWSDESK
GAS RESERVATION AROUND THE WORLD
Israel - 60% of gas extracted off-shore must be reserved
Egypt - 33% of gas production must stay within the domestic market
Indonesia - Case-by-case basis, but reservations of up to 40% in recent times
USA and Canada - "Public interest" laws allow governments to ensure gas exports do not overwhelm domestic supply
Norway, Russia, Algeria, Malaysia and Qatar - State-owned companies remain dominant producers, making certain domestic users get the home advantage
Western Australia - Australia's only state with a gas reservation policy. 15% of all gas produced in WA has to remain in the state