Australians are being warned of gas and electricity shortages over the next 24 hours as the East Coast cold pot pushes the country’s energy supply to the brink.
Millions of Australians in various states are being warned of gas and electricity shortages over the next 24 hours as the East Coast cold pot pushes the country’s energy supply to the brink.
At an emergency conference call on Wednesday, the energy regulator warned that Victoria, South Australia and Tasmania are facing gas shortages, while power supplies in NSW and Queensland will stall. The Australian reported.
The operator of the Australian energy market (AEMO) told more than 100 players in the industry that they could be forced to reduce gas consumption. AEMO has also invoked for the first time an emergency supply guarantee mechanism for gas producers.
“This is the biggest energy crisis in 50 years,” Andrew Richards, executive director of the Energy Users Association of Australia (USA), told 2GB.
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Industry experts have warned that the UK-style energy crisis could shatter Australia’s economy.
Wholesale electricity prices have skyrocketed by more than 140% in 2022 alone, driven by rising gas prices, although 70% of Australia’s gas is exported to the UK. foreigner.
Australian gas prices are typically around $ 3 per gigajoule (Gj), but this has skyrocketed to over $ 380 / Gj this week due to the failure of the energy market, forcing the regulator to intervene and set $ 40 / Gj limits in Sydney, Melbourne and Brisbane for the first time.
Treasurer Jim Chalmers has described the situation as a “perfect storm” of energy challenges. Talking to Nine’s Today On Thursday morning, Mr Chalmers warned that “there was no measure that could fix it overnight.”
“That’s a big problem,” he said.
“It’s useless to fight for the bush. We’ve raised gas prices, electricity prices, and gasoline prices.”
He blamed the former government for the “cost of living crisis we have inherited.”
“It extends beyond energy to construction supplies and everything else,” he said.
“It is a consequence of a perfect storm of international and national factors, but it is also the cost and consequences of almost a decade of chaos in energy policy.”
Chalmers said Labor wanted to “bring cleaner and cheaper energy to the grid”, but “this will take some time”.
“The most immediate options will obviously be part of a discussion with companies and also with the relevant ministers, and I really don’t want to get ahead of those discussions,” he said.
The treasurer said activating the local gas supply guarantee “also carries its own challenges and is not immediate”.
“There are a number of processes we should go through,” he said.
“We know the manufacturers and others would like us to press this trigger. We’ll relate to them as well, but we have to be honest and acknowledge that there’s nothing we can do to fix it overnight. It’s a problem. which has been going on for a long time. “
Origin Energy issued a profit warning on Wednesday, withdrawing its focus for 2022-23 as it could no longer see how the crisis would end.
The company asked the government to restart the struggling coal sector in order to lower prices.
“The key issue that I think industry and governments need to address is how they are really increasing the production of coal generation capacity here,” said Origin Executive Director Frank Calabria. The Australian.
Calabria warned that Australia could see a situation similar to that in the UK, where rising wholesale energy prices led to the collapse of 30 smaller retailers.
One such retailer in Australia, ReAmped Energy, took the extraordinary step this week to tell its 70,000 customers that they should consider switching.
“With the state of the Australian electricity market, the best thing you can do is leave ReAmped Energy and find another retailer,” CEO Luke Blincoe said in a video message on Tuesday.
“Prices will go up and keep going up and we just don’t want to pass that cost on to our customers.”
AI Group said Tuesday that the “apocalyptic” rise in energy prices threatened “chaos for industry and pain for households.”
“Immediate pressures stem from disruptions to old coal-fired power plants, the consequent high demand for power gas and the collapse of a medium-sized gas retailer. [Weston Energy]”said AI Group Executive Director Innes Willox.
“But beyond these sharp pressures is the attraction of international coal and gas prices, which are unprecedented since the invasion of Ukraine. With Europe announcing more steps today to move away from Russian energy , we can expect international factors to maintain high pressures on energy prices over the coming years, especially in natural gas. “
The USA has called on the gas industry to do more to minimize the damage being done to the economy.
Richards said gas companies should “play an important role in bringing gas prices back to a level where manufacturing can survive and families should not be afraid to turn on the heater in the middle of winter.” “.
“The gas industry will not break down if its prices go down, but manufacturers will leave the business if they don’t,” he said.
While he said it was “true that global events are having a significant impact on global energy prices,” the cost of extracting resources “has not changed materially and domestic customers are at the extreme.” wrong from approaching – or even exceeding – international prices).
“At current prices it’s hard not to conclude that some are taking advantage of the misfortune of others,” he said.
“In these desperate times, desperate measures such as gas reserves and price caps may be needed to preserve the industries we have, reduce the cost of living pressures on families and ensure that the most vulnerable in society do not suffer. this winter “.
frank.chung@news.com.au
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