Jim Chalmers (Rankin, Australian Labor Party, Treasurer) Share this | Hansard source

Thank you to the member for Fraser for his question. High gas prices are making life harder for Australians, for Australian industries and for Australian employers. Wholesale gas prices in the second quarter of this year, around the time of the election, were more than three times higher than at the same time last year. That's why in June I worked closely with the minister for energy and the Minister for Resources and together we tasked the Australian Competition and Consumer Commission to investigate skyrocketing gas prices, to consider the supply of gas to domestic versus export markets and advise the government of any regulatory changes that might be required. I want to thank the ACCC and particularly its chair, Gina Cass-Gottlieb, for the first class report that I've released publicly today, which combines an aspect of their regular monitoring with the extra work that we asked them to do.

It contains some sobering reading, particularly in relation to these three warnings that they issued. First, the upstream gas market is highly concentrated. Around 90 percent of the market is dominated by three major players. Second, exporters aren't always meeting the spirit of their obligations to the domestic market under the heads of agreement. Third, the domestic market faces a major supply shortfall in 2023 unless action is taken to fix the regime. In other words, the arrangements set up by those opposite aren't working to ensure enough domestic gas at competitive prices.

The ACCC made it really clear that the timing of the gas trigger isn't flexible enough and the rules are too narrow. The heads of agreement isn't working either, because companies aren't consistently offering gas to the domestic market with reasonable notice or at reasonable prices. Most of our excess gas, the gas that isn't contracted, is being exported to the international spot market to take advantage of the current conditions. The domestic shortage that comes from this is expected to be about one-tenth of the domestic supply that we need next year. But here's the thing: there's enough uncontracted gas to meet our needs in Australia if the spirit of the heads of agreement is adhered to. That's why the steps outlined by the Minister for Resources today are so important and why they are called for and supported by the ACCC: to reform the trigger and take the first step towards activating it, to consult on the best ways to go about it and to improve the heads of agreement.

This is all about two things: more gas for Australia at more competitive prices. As the PM said, we will take the necessary steps to make that happen. We call on the gas companies to do the right thing by our workers and by our industries. We can do all this without jeopardising our trade relationships and our reputation as a reliable exporter of energy. We are looking for solutions here, not unnecessary conflict. A decade of slogans, of 22 failed energy policies and of wasted opportunities has cost Australians and their industries too much already.

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