Peter Dutton's new energy plan sounds like a gas. In reality it means more emissions – and more profits for industry

The Guardian

28-03-2025

Peter Dutton's new national gas plan sounds good in theory: force gas companies to supply more gas for domestic consumption, thereby reducing domestic gas prices by about 40%.
But the reality is likely to be very different.
Dutton is keen to ramp up domestic production. In practice this would mean billions in new taxpayer subsidies to fund new gas infrastructure, new pipelines, new gas storage and new gas power plants. This would take years and years to approve, build and develop, locking in fossil gas use for many decades to come.
The multinational gas companies would be allowed to continue to feast at Australian energy users' expense. More subsidies. More gas production and more carbon emissions. More profits for the long term!
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Dutton's plan was unveiled as part of his budget reply speech on Thursday, in which he promised lower power prices under the Coalition.
The centrepiece of the policy is to decouple the domestic gas price from international prices by forcing current exporters to direct 10-20% more gas into the domestic market. 'This is all about ensuring Australian gas is for Australians.'
Currently, 300 to 350 petajoules (PJ) of fossil gas supplies domestic use in eastern Australia every year. Meanwhile the multinational gas industry exports 1,500-1,600PJ annually, or 84% of total production. Currently all of this is sold at export price parity, meaning we pay as much or more as users in Japan pay for our gas. Under the change, Dutton says this will increase by 50 to 100 PJ. Sounds solid in principle.
Dutton claims: 'This will drive down new wholesale domestic gas prices from over $14 per gigajoule to under $10 per gigajoule.' But Climate Energy Finance notes that for 50 years prior to 2015, the domestic east Australian gas price was just $3-4/PJ. Everything changed in 2015 when the gas companies contrived a domestic 'shortage' by permanently increasing production by 300% by opening up six LNG export trains concurrently in Gladstone, Queensland.
Lowering the price 30-40% permanently to 'just' $10/PJ to enable us to use our Australian public gas resources to supply our domestic needs first would be a good outcome. IF it could be delivered.
But the reality will likely be very different.
There is zero likelihood in our view that the Coalition will somehow find the political will to effectively regulate the multinational gas industry that is profiting at our collective ongoing expense. The industry is a major donor to both major parties, particularly the Coalition.
Despite Dutton's assurances, there are no new gas fields imminent, or even remotely ready to go. So when he says, 'The only way to drive down power prices quickly is to ramp-up domestic gas production', and effectively create a domestic gas reservation, thereby creating a buyer's market for local fossil gas, I have some doubts. Opening up the massive stranded Beetaloo Basin in the Northern Territory will lock in a massive new gas reservoir of what will be really expensive gas exceptionally remote to Australian consumers.
And there of course will be a massive quid pro quo.
Dutton used his budget reply speech to reveal he would commit $1bn of taxpayer money to subsidise more gas pipelines and more storage capacity. And he will open up the Capacity Investment Scheme to subsidise more new gas power plants.
General Electric has said there is a massive global shortage of gas turbines and that anyone wanting one will have to wait till 2030. Last time I checked, 2030 is very different to 'by the end of 2025'.
With all this talk of gas, one has to wonder: what happened to the government's nuclear plan?
Tim Buckley is the director of Climate Energy Finance, a public interest thinktank