Australian gas shortfall 'very unlikely', researchers say

| 20.05,17. 01:34 AM |

Australian gas shortfall 'very unlikely', researchers say

Photo: The gas shortage has been overstated by AEMO and there is no supply crisis, researchers say. (AAP)

Is Australia really running of gas and does the Federal Government need to
?impose export restrictions

"No, not really", is the answer, according to Melbourne University researchers who found that a "gas-supply shortfall is very unlikely to occur".

Central to the Government's policy is the idea that Australia faces an "energy crisis" and consumers need to be protected from contracted export supplies causing shortages which would cause domestic prices to spike.

The paper published by chemical engineers Dylan McConnell and Tim Forcey argued the agency charged with administrating and operating national gas and electricity markets, the Australian Energy Market Operator (AEMO), overstated the severity of a potential shortfall.

Prior to the Federal Government's announcement last month that restrictions could be placed on gas exporters, AEMO warned in its Gas Statement of Opportunities report that national reform was needed, or else Australia would fall victim to gas supply shortages, which in turn would lead to power outages from late next year.

'A Short-Lived Gas Shortfall'

That idea has been savaged by Dr McConnell and Mr Forcey, who was formerly AEMO's gas principal.

In a research article titled A Short-Lived Gas Shortfall, the pair found, "the size of AEMO's forecast shortfall is very small, amounting to no more than 0.2 per cent of annual supply (of either gas or electricity)."

Dr McConnell and Mr Forcey were equally blunt about the data AEMO used in its report and helped shape government policy.

"AEMO lacks information about gas reserves, gas production facility capabilities, and the short and long-term plans of gas producers," the pair wrote.

"Were AEMO able to access better gas-industry information, AEMO's modelling activities would be more robust and have greater value."

Gas supply and prices still under review

It is a view understandably not endorsed by AEMO's new chief executive Audrey Zibelman.

Speaking on ABC's The Business program Ms Zibelman. denied that her organisation's forecast was incorrect or incomplete.

"The forecast we made was based on the data provided to us by the producers," she said.

"The information was complete from the perspective of the time we received it."

However Ms Zilberman was not overly effusive about the quality of information gas producers have always supplied.

"Previously, there's always been a challenge in terms of the transparency of the information, and the availability," she said.

Ms Zilberman also conceded AEMO needed a better level of communication with the producers on how "we are using that data" so "they can make certain what they're giving us is as accurate as possible".

The gas market's lack of transparency on pricing and supply is well-documented, and is subject of yet another inquiry by the Australian Competition and Consumer Commission.

AEMO is currently updating its report on gas supplies.

Asked whether AEMO was likely to change its views about a potential gas shortage, Ms Zilberman's replied, "I don't want to get ahead of the publication of the report" and emphasised the need for the gas industry to work closely with AEMO.


(Votes: 0)

Other News

Hunt for man who allegedly brought 17yo to Sydney as 'sex slave' Manus Island: Leaked security report says M16, shotgun fired into detention centre Traffic chaos as Sydney's bus strike continues into peak hour 1,200 Sydney bus drivers to strike on Thursday Man charged with murder following death in suburban Wagga Wagga Canberra's proposal to get NSW 'all aboard' with improving rail speeds Search underway for light plane missing in northern NSW Disability groups tell Bill Shorten the Medicare levy increase is fair 12yo girl allegedly tied up, sexually assaulted on walk to school on NSW Central Coast Ransomware attack still looms in Australia as Government warns WannaCry threat not over First Australian business infected in global cyber attack Wedding ends in 30-person brawl on inner west street Government, Opposition face off over Medicare levy increase Massive cyber attack creates chaos around the world Sydney school at war with erotic massage parlour over ads Sydney drug driver found guilty of charges relating to crash that killed 7yo nephew WestConnex: Sydney's latest toll road to cost motorists more than $4.50 Plans to change paid parental leave scheme scrapped Fire at Sydney Olympic Park sends black smoke over city's west WestConnex: City of Sydney proposes abandoning stage three connection between M4, M5 Body farm on Sydney's outskirts overwhelmed by number of donors Federal budget 2017: Limit Medicare levy increase to high-income earners, Bill Shorten argues Four Sydney Muslim women attacked in Broadway NSW police force gets two new Deputy Commissioners in Jeff Loy and Gary Worboys Federal Budget 2017: Winners and Losers Opal card fares to rise on July 3 Federal budget 2017: Your cheat sheet to understanding what's what Eddie Obeid: Jailed former NSW Labor minister still collecting parliamentary pension Australian man Stephen James Richardson found dead in Bali, Indonesian police investigating The 53th Annual Congress of Muslims Australia (AFIC)