Fight brews as government mulls plans to cap gas prices



Nov 29 2022
The New Daily

At least one state is squaring up for a fight with the federal government as it considers gas price caps and other interventions to curb Australia’s spiralling energy bills.

As the Commonwealth prepares to intervene with a nationwide curb on power prices, Queensland Premier Annastacia Palaszczuk warned late on Tuesday that her state would not sacrifice energy rebates enjoyed by Queenslanders.

Prime Minister Anthony Albanese’s cabinet is expected to go ahead with a new strategy to limit power price rises across the country after the federal budget forecast two years of rising household energy bills.

The government is working out the details of how gas prices can be capped, and crafting a policy that may include subsidies.

The ABC reported on Tuesday that the plan would likely include a cap on wholesale gas prices at about $12 a gigajoule, demands for a guaranteed domestic gas supply from producers, and a mandatory code of conduct as part of a market intervention first flagged five weeks ago.

The details are expected to be made public as early as next week, when Mr Albanese will lead a national cabinet meeting and Energy Minister Chris Bowen will meet his state counterparts.

Market ‘out of control’
However, a $12 cap would be too high for the Australian Council of Social Service and the Australian Workers’ Union, which said on Tuesday a wholesale price lid should be closer to the five-year average spot price of $8 to $10 a gigajoule.

Prices have been three times that this year in most markets, according to the Australian Energy Regulator.

“This is a market that is out of control at this time,” ACOSS CEO Cassandra Goldie said on Tuesday.

“We need to protect people from the ravages of what is happening to the price of the energy bills they are receiving.”

ACOSS and the AWU said any intervention must also include price caps on coal and electricity, be complemented by commitments to encourage energy efficiency for households and industry, and consider the broader tax arrangements applying to resources companies to ensure the current crisis was not repeated.

Almost everybody on income support was already in severe rental distress, making increases in electricity prices particularly alarming, Ms Goldie said.

“They do not have room to move on their budgets.”


Households have no room to move on their budgets.
The government is reportedly yet to settle on a decision on what to do about coal prices, which have soared on the back of the Russian invasion of Ukraine.

AWU national secretary Dan Walton said without action on energy, Australia was perilously close to job losses and quality manufacturers going under.

“Our nation was set up with energy being our competitive advantage,” he said.

“That competitive advantage is disappearing into the back pockets of multinational gas companies and multinational coal companies.”

Mr Walton expressed frustration at how long the government was taking to come up with a plan.

“We’ve seen them nodding and saying they agree, yet we don’t see a solution,” he said.

“If we don’t get a solution wrapped up by Christmas, we are going to see many, many, many good quality workers out of a job.”

State’s ‘heavy lifting’
On Tuesday, Ms Palaszczuk told Queensland’s parliament that her state was doing the “heavy lifting” on gas production and she would seek compensation if the Commonwealth intervened in supply.

“Let me say very clearly to the federal government – hands off our generators,” she said.


Annastacia Palaszczuk says Queensland is doing the ‘heavy lifting’ on gas production. Photo: AAP
“There is no way that Queensland is going to sacrifice those returns [rebates] that we are able to provide back to Queenslanders.

“Queensland is always doing the heavy lifting and we need to make sure that if there are any steps by the Commonwealth in this direction that Queenslanders are fully compensated.”

Ms Palaszczuk suggested NSW and Victoria could “open up some of their gas fields” to curb supply issues in the south.

Earlier on Tuesday, Federal Resources Minister Madeleine King said the government was considering capping gas prices as part of an overall policy to drive down electricity prices.

The government was in discussions with the states and territories on the policy, she said.

“Price capping is but one option and that is why … the government needs to be very considered on this and very precise in its response.”

In the recent budget, Treasury forecast retail power prices would rise 20 per cent by late 2022 and another 30 per cent in 2023-24.

You realise you still end up paying for it some other way, right?

Resume the bloody lot and kick out the foreign companies robbing us daily ....... play by our rules or get off the field..... always was Australian gas - always will be .....

(Hoo-Rah!)

Wait one - the 'socialist' Pale Assed Chick in Queenslund (they do things diff'runtly up there, you know) doesn't want Queenslunders to miss out on their subsidies?  How would they unless the governments various canceled the poor people's subsidies, something total anathema to a ..................... (gasps) ................... noble upstanding socialist government for the people?

Is she saying that if the price is capped (and her mates lose money as a result which means her real retirement package will be smaller than 20-30Bn or so) she'll strike by canceling subsidies for the poorest in the land?

The true New Mandarins with absolute control and rule - and you fools vote for them......

Just yestiddee on the wahless someone was on about despotic governments maybe here and of course - referred to the 'right' being the centre piece for despotism .... well - guess what - they're ALL fcking Right, Jack!!  As well as being all right, Jack!!

Wait until I get my pirate radio twelve miles offshore..... start my Brando's to the mainland.... 

Belgarion wrote on Nov 30^th, 2022 at 10:28am:


Rather well put and succinctly, too, old boy.... some of us do get carried away... it's a disease of the CPS - they always told us never to under-write any report... dazzle 'em with science, they said.... or put 'em to sleep and make 'em feel worthless for not understanding the report...



.. clear as mud .....(translates) if we change the paradigm we are using, we may be able to get some industrial leaders to take part in altering their direction towards something that will actually be more productive and perhaps more profitable for everyone....

You know - shift a few bludgers off the serial housing market via pressures and compel them instead to invest in hard infrastructure projects that will benefit more.... stuff like that.... would ruin a few politician's portfolios though.... so no dice... and who's going to head down to the bank and say - "Look - I've got some equity in my home - can I borrow way over the limit to invest in building an extra Snowies Scheme in Tasmania with a link to the mainland?"

(bank manager looks at you strangely... presses red button... men in white coats are on their way with cattle prods and leg chains etc ....)

whiteknight wrote on Nov 30^th, 2022 at 5:42am:



oh you dummy , mr white knight,  they are going to reduce bills by providing subsidies.

ie  they are going to print money and mail you a cheque to help pay your power bill.

welcome to 5 more years of 10 to 15 % inflation.

what a dill you are

Grappler Truth Teller Feller wrote on Nov 30^th, 2022 at 2:34pm:



costs rise when you produce less and have more cash pumped into the economy.

costs fall when you produce more and have less cash in the economy.

how do you remove cash from the economy so that cash is not bidding up prices?

you can pump up interest rates and people will then put their money in the bank.

but with interest rates at 3.5 % and inflation at 8 % , people will still be incestivised to borrow and spend (and hence bid up prices).

you can produce more energy and then prices will fall.

but with coal plants going off line, that wont happen.  we could frac more or we could reneg on our deals with foreign gas companies but i suspect they have iron clad contracts.

my belief is peter beattie and anna bligh signed contracts out for 25 years to get them to build the facilities.

WA was more sensible and made them supply the donestic market first.


what cannot possibly work is for albo to go further into debt by issues bonds which the reserve bank then buys (ie just print cash) and mail it out to citizens to help them pay their power bills.

that is the definition of inflating the money supply whilst not producing one extra gram of gas.

that has to create inflation and then up go the prices.


it is absolutley no different to a household in debt getting a third credit card to pay off the second credit card.

remember

in the end , all government spending is taxation.

albo or peter dutton wont be paying it back out of their pockets.
they have indexed pensions for life.

YOU will be paying it back

when the government mails you a cheque or gives the public service a pay rise or announces 60 billion for the NDIS, that is a tax which YOU will be paying.

the truly evil thing is that governments then try to blame the inevitable inflation on greedy businessmen.

nope.

all the inflation you are about to cop ( and i expect 10 to 15 % for the next 5 years) is due to government spending and decisions like reducing production (shutting all coal plants is reducing production...how could it not be )