Labor to give more guidance to gas firms

January 17, 2023 07:40 AM AEDT | By AAPNEWS
Image source: AAPNEWS

Treasurer Jim Chalmers will provide more guidance as gas companies and the corporate watchdog struggle to implement his government's new price cap.

The Australian Competition and Consumer Commission wants more information on how the cap will work after some gas retailers stopped accepting new industrial and commercial customers.

Companies are also letting expiring contracts fall onto expensive default tariffs, as they have not been able to secure supplies from producers.

But after the ACCC warned it will investigate producers if they suspect they are not providing gas where they can, Dr Chalmers said "guidance will be provided before long" if that was what the watchdog needs.

"We do need to remember this gas price cap, which is a substantial intervention in the market ... only came in a few weeks ago," he told ABC TV on Tuesday.

"Inevitably over the Christmas period, as businesses try and negotiate new deals, that won't just happen immediately, there will be some issues as we implement this gas price cap ... the ACCC will provide the kind of guidance which some players in the market have been seeking."

An ACCC spokesperson said on Monday the commission would closely monitor gas producers due to concerns the cap was disrupting supply talks with retailers.

"If we become aware that gas is not being made available and there is evidence that it was ­planned, or likely, to be available, or is being offered on terms which effectively equate to a refusal to supply, we will investigate whether that conduct may amount to an avoidance scheme," they said in a statement.

The treasurer said the price cap, along with electricity relief currently being worked through with state and territory governments, would keep bills down.

"These are all important, considered measures we're putting in place which recognise the pressure families, pensioners, and businesses are under," Dr Chalmers said.

"Inevitably when you're imposing a price cap on an important part of the economy, these gas companies are doing incredibly well on international markets, they would prefer there wasn't a price cap obviously, but we need to do what's right by the whole economy."

Federal parliament was recalled before Christmas to pass the legislation for the temporary gas price cap following an agreement by the prime minister and state and territory leaders at national cabinet.

The price cap applies to new domestic wholesale gas contracts by producers on the east coast and came into force on December 23.


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