The Australian Energy Market Commission (AEMC) has released a report revealing that Australia’s gas market liquidity has improved over the past two years, helping to drive efficiency and lower gas prices for consumers.
The Commission’s report, 2020 Biennial Review into Liquidity in Wholesale and Gas Pipeline Trading Markets, tracked changes in trading activity in Australia’s gas markets and the impact of reforms introduced since 2016.
“The Commission’s biennial review indicates a number of positive signs – and evidence that progress is being made towards the energy Ministers’ vision to establish a liquid wholesale gas market that provides the right market signals for investment and supply,” the AEMC said.
“However, the findings vary across the different gas markets and traded products,” it said.
“All the work undertaken to date has focussed on delivering against COAG (Council of Australian Governments) Energy Council objectives to make it easier to buy and sell gas in Australia – and help keep the cost of getting gas from source to consumers as low as possible.”
The AEMC said the ability to move gas around efficiently was important for household and business use as well as a fast-response fuel for electricity generation.
“This report will set a baseline for the state of market liquidity against which the effects of the COVID-19 pandemic can be assessed in the next review in 2022,” it said.
It said the report provided preliminary information on the impact of COVID-19 on gas prices and demand, however the information used by the review largely predated the impacts of the pandemic.
The AEMC’s 151-page report can be accessed at this PS News link.
