An alliance representing Western Australia’s largest gas users has called on the Australian government to guarantee the state will be “no worse off” as it moves toward a National Domestic Gas Reservation Scheme.
In a submission responding to the draft scheme, the DomGas Alliance urged the immediate establishment of Western Australian stakeholder workshops to help shape the design of the national framework.
The group said such workshops would ensure the transition does not erode WA’s existing protections or diminish the state’s supply certainty once a national scheme comes into effect.
The Alliance argues that any national policy must accommodate the unique character of the WA gas market, which it says is substantively different from the east coast and has operated under its own reservation policy for two decades.
That scrutiny comes as WA’s existing reservation policy faces mounting criticism from major gas users over implementation, compliance and enforcement shortfalls that have undermined its ability to consistently meet its objectives.
A 2024 WA Parliamentary Inquiry found that LNG producers had delivered only 8 per cent of supply against a 15 per cent target, well short of expectations.
According to DomGas Alliance modelling, performance was even weaker at the project level, with Woodside’s Pluto project delivering just 3.4 per cent.
The submission outlines several key differences between the WA policy and the proposed national scheme.
Where the WA policy requires LNG exporters to reserve gas equivalent to 15 per cent of LNG exports for the domestic market, the national scheme would lift that figure to 20 per cent, measured in joules of thermal energy, a target the Alliance understands was derived from analysis of the east coast market.
The submission also points to a shift from an “obligation to offer” supply under the WA policy to an “obligation to supply” under the national scheme, which the Alliance says would represent an improvement for consumers, depending on the scheme’s final design.
Similarly, it notes that WA’s policy assesses compliance on a life of project basis, an approach that has produced inconsistent reliability outcomes, whereas the national scheme proposes treating each year as a discrete compliance obligation, a change the Alliance says could improve investment planning and competitiveness for downstream industries and domestic buyers.
Enforcement is another point of divergence.
The WA policy contains limited enforcement mechanisms, while the national scheme contemplates legislative enforcement tools, mandatory compliance plans, performance reporting and explicit remedies for non-compliance.
The Alliance says the national scheme must also address matters specific to the WA market, including existing agreements between the state government and producers, established reporting mechanisms, onshore gas policy, and unresolved issues such as the underdelivery of gas from the Pluto project.
According to the submission, any transition to a national scheme must ensure domestic gas supply does not decline from current or reasonably projected levels, safeguard price competitiveness for WA consumers and industry, maintain or improve supply certainty throughout the transition, and respect the existing contractual obligations of WA based producers to domestic purchasers.
DomGas Alliance spokesperson Mia Davies said the state’s long experience with domestic gas reservation offered important lessons for national policymakers.
“Western Australia has almost two decades of experience with domestic gas reservation. We know what has worked, but we also know where the policy has fallen short,” Davies said.
“The effectiveness of a policy should be judged by its outcomes, not simply by its existence or level of public support.
“We’ve learnt valuable lessons about policy design, implementation, compliance and enforcement in WA that should inform the national framework.”
Davies said significant uncertainty remained about how the national scheme would interact with WA’s existing arrangements.
“To complicate matters, it’s still unclear how the national scheme will operate in Western Australia, how it will interact with the existing WA Policy, or what happens to existing contractual arrangements,” she said.
“We cannot afford for Western Australia to be an afterthought in a national scheme.”
Davies said the state’s gas market could not simply be folded into a framework built for the east coast.
“You can’t simply overlay a national framework on top of an existing State policy and expect it to work,” said Davies.
Davies said WA’s gas market is fundamentally different from the east coast’s, and that this difference appears to have shaped the framework’s development so far.
She added that how the Commonwealth chooses to handle WA is a critical question, which is why the Alliance is pushing for dedicated Western Australian stakeholder workshops, so the key policy differences can be worked through, the implementation process understood, and WA consumers and industry protected from being left worse off.