The Coalition has unveiled its strategy aimed at lowering energy costs if they gain power in the upcoming federal election next month. The Opposition’s plan focuses on enhancing Australia’s gas supply, with the assertion that this approach will reduce electricity expenses for both households and businesses.
Research from Frontier Economics suggests these proposed measures could lead to a 3 per cent decrease in electricity prices. To support this initiative, the Coalition intends to establish a $1 billion fund dedicated to improving gas infrastructure, which they claim will alleviate supply restrictions. Additionally, they plan to allocate $300 million for a strategic basin plan to further develop gas resources.
Frontier Economics has identified that one significant factor behind high gas prices in Australia is the tendency for gas producers to sell to international buyers for higher profits. In response, the Coalition’s strategy includes instituting an “East Coast Gas Reservation Scheme.” This initiative would require gas suppliers to reserve a portion of their output for the domestic market.
Experts from Frontier Economics predict that implementing these policies would boost domestic gas supply, ultimately leading to lower prices. The modelling indicates substantial benefits, including a potential 15 per cent reduction in retail gas bills for industrial consumers. Residential electricity costs could drop by 3 per cent due to the projected 7 per cent reduction in retail gas prices.
In summary, the Coalition’s proposal is framed as a crucial step towards providing financial relief for Australians struggling with rising energy costs, while increasing the efficiency and availability of gas resources within the country.