The Australian government has decided to finalise new regulations, which will come into effect July 1, to restrict LNG exports.
Canberra called its decision “immediate action to put downward pressure on power prices and ensure reliable energy for all Australians.”
The Turnbull government also plans to “strengthen the Australian Energy Regulator by providing it with an additional A$67.4mn to stop energy network companies from gaming the system and overturning rulings in the courts,” it said June 20.
The decision comes as the Australian east coast markets faces gas shortages and escalating electricity prices amid increasing LNG exports.
The government said it will also take immediate action to address escalating electricity prices. The A$67.4mn the government will provide to Australian Energy Regulator will ensure it is fully equipped to address behaviour in the market that is pushing up electricity prices, it said.
The Australian Energy Market Operator (AEMO) will be tasked to identify the existing and potential loss of continuous, dispatchable (baseload) generation; talk to suppliers and customers, particularly large-scale emissions intensive industrial users, about what they need to secure future investment; and examine how much continuous power is needed in the short term to stabilise power prices.
Meanwhile, AEMO released June 15 new toned-down warnings of tight gas supply for the country’s east coast over the next couple of years. The release follows the AEMO’s forecasts in March which said the eastern seaboard states of New South Wales, Victoria and South Australia, could see a shortfall in gas-powered electricity by as soon as the Australian summer of 2018-2019.