SYDNEY – Australia will restrict gas exports to ensure local sourcing and lower electricity costs, Australian Prime Minister Malcolm Turnbull said on Tuesday.
“We are taking immediate action to put downward pressure on power prices and ensure reliable and secure energy for all Australians,” Turnbull said at a press conference.
The decision aims to counteract high energy tariffs caused largely by the shortage of gas supplies on the east coast, the country’s most populated region.
The measures, which include restrictions on exports when there are shortages in the domestic market, will enter into force on Jan. 1, 2018, when electricity tariffs will increase by 20 percent.
Turnbull said his government will tighten regulations in the gas sector to give Australians priority access for gas supply and provide an additional allocation of $51 million to the energy regulator to stop power companies overturning court rulings.
He will also ask the Australian Energy Market Operator to account for the power generation stations that can close soon and report on the possibility of investing in them, including government funding.
The prime minister left open the possibility of using taxpayer support for upgrading coal and gas-powered electricity generators to ensure affordable supply in the domestic market.
“It is unsustainable for our country to be the world’s largest exporter, but to be paying some of the largest prices for gas,” Resources Minister Matthew Canavan said at the same press conference.
The measure was proposed in April when Turnbull announced a plan to impose controls on liquefied natural gas exports to overseas companies in case of shortages in the domestic market.
Australia exports two-thirds of its gas production and has restrictions in some states for the exploration of this resource.
The AEMO recently warned of possible gas shortages in the states of New South Wales, Victoria and South Australia from the summer of 2018-2019.