The state of Australia's growing gas industry
Australia's gas industry continues to make headlines as the government continues to research and delve deeper into the nation's resources in order to get the most out of economic and export opportunities.
The Grattan Institute, an independent think tank dedicated to developing high quality public policy for Australia, has released a report, Getting gas right: Australia's energy challenge. The report describes a global gas revolution, where Australian gas producers and consumers could easily be winners or losers depending on how the tide turns.
The report notes that this gas revolution is likely to raise bills in Australian households, but the government should resist calls to intervene to keep gas prices low.
"For years local prices have been low by world standards, but when suppliers can get a higher price exporting than on the domestic market, the domestic price has to rise," said Mr Wood, who is the Grattan Institute's energy program director.
The report states that the development of Australia's liquefied natural gas (LNG) export industry could be the world's largest by the end of the decade, which could lead to price rises of up to $170 a year for households.
"Not everyone likes it, especially when electricity prices have also been rising, but it’s a natural consequence of an evolving market," said Mr Wood.
The government is currently researching the creation of an east coast gas export market, which would join with Western Australia's exports to create an industry worth an estimated $50 billion a year by the year 2017.
Demand for gas is growing significantly in Asia and this is one of the most significant contributors to Australia's growing market.
However, the Grattan Institute's report warns against being too complacent, as there needs to be significant infrastructural upgrades to support such a large industry.
Minister for resources and energy Gary Gray stated that Australians need to have access to secure, reliable and competitively priced energy on a long term basis, and that any policy will be highly considered.
Gas studies underway in eastern Australia will help the government be more informed about gas supply and demand, as well as call attention to potential supply constraints and enlighten future decisions.
Posted by Callum Fleming