According to AGL’s CEO, east coast gas prices could skyrocket soon.
The situation will occur as a result of the effects of LNG plants being constructed at Gladstone. An article on The Australian says when these plants start up in 2015; spot gas price spikes are likely to be exacerbated by demand for Australian gas from Asia.
“For industrial and commercial gas users, I have no doubt there will be demand destruction,” said Mr. Fraser.
“You start with baseload gas power generation, that is the first load that will get knocked off because it doesn’t work without a price on carbon, those gas prices.”
The situation will also impact households; but Mr. Fraser claims average per-household annual increases are likely to be less than $100.
However, with households being pummelled by energy price rises in recent years and the much vaunted carbon tax repeal perhaps unlikely to deliver the savings promised; any further increases in energy bills could be the proverbial straw.
Earlier this year, Matthew Wright, Executive Director of Zero Emissions said common major gas appliances already have an electric competitor that beats them on price and performance; including induction cooktops, heat pump hot water units and reverse cycle heat pump air-conditioners.
In July, Mr. Wright also forewarned the push to develop more gas fields in Australia had little to do with securing domestic supplies and lowering prices and more to do with export profits.
“Do not be fooled by the fossil gas miners – they’re not here to give Australia a competitive advantage, only renewable electricity generators can do that as there is no way to export renewable electricity,” he said.
Financial costs aside, the other impact of Asia’s thirst for Australia’s gas reserves is the cost to the environment from the rush to dot the landscape with coal seam gas wells.
