The competition watchdog has warned that the eastern seaboard is at risk of running low on gas a year earlier than it forecast in December, with major new supplies needed by 2027 to stop homes and businesses running short.
Its latest report on the east coast gas market, released on Thursday, highlighted challenges for the Albanese government, which is under pressure to shore up energy supply as it pursues an ambitious renewables rollout.
ExxonMobil’s Marlin B platform in the Bass Strait, which was traditionally the mainstay of the state’s gas supply but whose fields are now depleting rapidly.Credit: ExxonMobil
The Australian Competition and Consumer Commission’s report said there was an urgent need for new gas fields, additional pipeline capacity to bring more fuel from Queensland, or special import terminals to receive shipments from Queensland, Western Australia or overseas.
While forecast annual supply deficits have been brought forward from 2028 to 2027, the ACCC and the energy market operator have both warned of the risk of gas supply gaps in NSW and Victoria on days of peak heating demand during winter cold snaps.
The Australia Energy Market Operator last month issued a rare “threat to system security” notice, which will last until September, over low gas supply amid a bout of chilly weather and low wind and solar output.
However, Treasurer Jim Chalmers said government policies would make a “meaningful difference” to supply over the next three years.
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“Our reforms are working to secure more supply for the domestic market while putting downward pressure on energy prices,” Chalmers said.
He pointed to reforms such as the heads of agreement struck between the federal government and gas producers in 2022, which requires that all uncontracted gas is offered for sale in the domestic market before it is sold overseas, although it does not stipulate that any shortfalls must be filled.