The Business Council welcomes the opportunity to respond to the Mandatory code of conduct for the east coast gas market Consultation paper.
On 9 December 2022, the Prime Minister announced a suite of measures to shield Australian families and businesses from the worst impacts of predicted energy price spikes caused by Russia’s illegal invasion of Ukraine and the consequent pressure on global energy markets.
The BCA acknowledges the need to address the impacts of the global energy crisis using well targeted subsidy measures and we support the Energy Bill Relief Fund component of the Energy Price Relief Plan to achieve this end.
However, it is our strong contention that the other two regulatory components of the Energy Price Relief Plan — i) the cap on wholesale east coast gas prices and ii) the mandatory code of conduct governing market behaviour — will lead to higher energy prices and lower energy security in the longer term.
We are calling on the government to do two things immediately:
- implement a formal trigger for removal of the mandatory code / price provisions as soon as practicable, and
- commence work with industry on defining an investable, long term gas market strategy for Australia.