The Chair of the Australian Competition and Consumer Commission (ACCC), Rod Sims has called for improvements in the nation’s gas industry, describing the market as neither functional nor competitive.
Speaking at a gas industry conference in Sydney, Mr Sims said consumers were suffering as a result.
“Stronger measures need to be taken so businesses and households are not paying more for gas than would be expected in a well-functioning market,” Mr Sims said.
“Our gas inquiry continues to find the gas market is not a functional, competitive market,” he said.
“We can see no end to the increasingly complex and difficult environment we are in, unless LNG producers and other gas suppliers, pipeline operators and Governments all work together.”
Mr Sims noted the lack of progress on the voluntary Gas Code of Conduct, which was intended to even the playing field between gas suppliers and buyers.
“The failure by industry to present a substantially progressed voluntary Gas Code by the Government’s deadline of February this year is unacceptable,” the Chair of the ACCC said
“Stunningly gas users have yet to even see a copy of the Code.”
He said it was fundamental that the Code provide clear and meaningful obligations on gas suppliers; offer clarity and certainty to users; have independent and detailed governance arrangements; as well as dispute resolution arrangements.
Mr Sims said export parity prices were an important factor which influenced domestic gas prices and affordability in the east coast gas market.
He said that despite gas prices falling significantly over the past year, the ACCC’s January report found that prices were still higher than export parity and the risk of a supply shortfall remained.
“The ACCC welcomes the steps taken by various Governments over the last year to facilitate the development of new sources of supply,” Mr Sims said.
