Gas market trigger won’t fix ‘bin fire’ left by Coalition, energy minister Chris Bowen says
The Albanese government has ruled out the early use of a gas market mechanism set up by the Turnbull government to limit energy price rises, saying it could not be activated until January and was not designed to cap prices.
The Australian domestic gas security mechanism was set up in 2017, and could not come into operation without consultation with the industry, new climate and energy minister Chris Bowen told his first media conference after being sworn in yesterday.
“It’s not an easy trigger to pull, it’s complicated, and if it was pulled today it would have absolutely no impact until the first of January anyway,” he said. “It was not really designed to see existing contracts undermined.”
Bowen, who began the press briefing by sharing the podium with emergency climate leaders, was pressed on what new treasurer, Jim Chalmers, has described as a “perfect storm” of price spikes in eastern energy markets.
“[The] former government promised a gas-fired recovery and left us a gas bin fire for the new government,” Bowen said.
A severe cold snap and outages of coal-fired power plants have lately sent wholesale energy prices soaring, forcing some smaller retailers to drop out of the market. Gas users, for instance, have been paying as much as $800 per gigajoule, or 80 times typical prices, prompting authorities to step in wth$40/gj price caps in Melbourne and Sydney earlier this week.
Suppliers and customers were also called by the Australian Energy Market Operator into urgent meetings yesterday to address “a potential gas supply shortfall event” in Victoria.
While Bowen said he was not ruling out future use of the mechanism – the responsibility actually sat with the resources minister, Madeleine King – his emphasis would be on
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