Gas and electricity pricing reform
By Patrick Hastings, CEO, Gladstone Industry Leadership Group
As we return from the holidays, it’s worth acknowledging the challenges that exist for Gladstone Industry - electricity and gas prices in Queensland.
Significant price escalations over the last six years have put pressure on Gladstone’s major Industry players who consume approximately one-third of Queensland’s gas and a significant amount its electricity, including Queensland’s largest single contestable load.
Since 2011 the average dollars-per-megawatt-hour for electricity has increased by $29.02 and prices are currently predicted to increase even more in 2017.
According to a report in 2015 by Oakley and Greenwood focusing on gas price trends, we have seen an increase of 100% in the wholesale market price, of gas per gigajoule, since 2011.
These continual price climbs are not sustainable and Queensland’s wholesale electricity and gas prices make it challenging for Queensland companies to be competitive at an international level.
Whilst we recognise that there are challenges within the national electricity and gas markets, the state and federal Government must look at reforming both its current policies and agendas to ensure that regional Queensland can be strong and sustainable in the medium and long-term.
The outcome of these reforms needs to ensure a reliable, affordable long-term electricity and gas supply. Both our state and national Government have a strong focus on stimulating growth in the economy and employment. A part of this focus needs to recognise the needs of existing Industry and its ongoing contributions to the Gladstone, Queensland, and Australian economy.
Working with Industry to find affordable and sustainable long-term pricing on both electricity and gas provides a visible and strong commitment to the future of Gladstone and regional Queensland.
What is a megawatt and a gigajoule?
Chart: The average gas price paid by large Industrial customers in the Gladstone region year-on-year.