
The Australian Competition and Consumer Commission (ACCC) has released its latest gas inquiry report, highlighting a complex landscape for Australia’s east coast gas market.
While the short-term outlook shows a surplus for 2025 and 2026, the report raises significant concerns about long-term supply and infrastructure development.
ACCC Commissioner Anna Brakey emphasised the potential for structural gas shortfalls on the east coast from 2027 unless supply increases or demand decreases.
The report identifies several barriers to new domestic gas supply, including lengthy regulatory approval processes, large upfront capital costs, an uncertain policy environment, and a lack of competition in upstream gas markets.
The projected surplus for 2025 is estimated between 77 and 112 petajoules, with 2026 expected to see a surplus between 54 and 99 petajoules.
This improved outlook is attributed to the shifting of some contracted export volumes and higher levels of gas production in Queensland.
However, the southern states are still projected to face seasonal shortfalls and will continue to rely on gas from Queensland or storage to meet peak demand.
In response to these findings, the ACCC has recommended that the role of gas be made explicit in government planning for the energy transition.
One suggested option is the development of a gas market system plan, similar to the Integrated System Plan for electricity, to identify and coordinate planning for necessary gas investments.
The report also notes a decline in gas prices, with producer prices for 2025 supply falling by 2 per cent to $14.77 per gigajoule and retailer prices dropping by 13 per cent to $15.43 per gigajoule between January and June 2024.
This decrease is likely due to lower international prices and increased gas availability.
Australian Energy Producers Chief Executive Samantha McCulloch has echoed the ACCC’s concerns, urging governments to fast-track new gas projects and provide policy certainty to avoid shortfalls and higher energy prices.
McCulloch highlighted the need to remove barriers to investment and ensure reliable and affordable energy for Australian homes and businesses.
As the energy landscape continues to evolve, the ACCC’s report serves as a crucial reminder of the challenges and opportunities facing Australia’s gas market.
With the next supply-demand outlook report due in March 2025, stakeholders across the industry will be closely monitoring developments in this critical sector.