Contract ‘natural’ gas prices in eastern Australia are at levels that make gas an uncompetitive fuel in all sectors of gas usage.
Eastern Australia is a major exporter of LNG. Such is the plentiful supply of gas in eastern Australia that 70% of the gas produced is exported.
Domestically, eastern Australian wholesale gas prices are the 7th most expensive out of 54 countries surveyed by the International Gas Union. Of the major exporters, eastern Australian wholesale contract prices are:
- Over 5½ times those of Qatar, the second largest exporter of LNG
- Over 3 times the price of gas in the USA
- Nearly 5 times the price of gas in the Russian Federation.
The result of the decline of gas as a competitive source of energy in eastern Australia is that gas consumption has fallen 23% since 2014. In the gas-fired generation sector (for electricity production), gas usage has fallen a staggering 67%.
Far from being a transition fuel, gas is a fuel transitioning out of the energy system.