The Nationals leader, David Littleproud, has declared energy prices will be cheaper under a first-term Coalition government that plans to increase gas supply, without providing modelling and acknowledging significant “capacity constraints”.
The Coalition has announced it will fast-track the approval of Woodside’s North-West Shelf gas project and offer subsidies to existing gas plants. Unspecified red tape will be removed and the “national interest” test in the environmental approval process would also be amended to give greater weight to economic and social benefits.
When asked whether he could guarantee energy prices would go down during the first term of a Coalition government, Littleproud said “if you increase [gas] supply, yes”.
“That’s what we intend to do by bringing in gas and quickly,” Littleproud told the ABC. “You’ve got the gas here. We have sovereignty over all our resources. So why wouldn’t we use them?
“To get [prices] down in the short term, the only way is to increase supply. That’s an economic principle that no one can run away from.”
The promise has been met with scepticism by Tony Wood, the program director for energy at the Grattan Institute, who said there was no evidence to support the policy pledge.
“Every election, someone makes a promise to bring down prices and every election they are wrong,” Wood said.
“I don’t see anything that is going to bring down the cost of gas, apart from a change in the international situation,” Wood said. “Any of the things the [Coalition] are talking about are not going to deliver any new gas, any time soon”.
In response to Littleproud’s comments the prime minister, Anthony Albanese, questioned whether the Coalition could deliver on its promises.
“The former government had this big announcement … about a gas-led recovery,” Albanese said. “Not much happened. You don’t need rhetoric, what you need is actual investment.”
The “gas-led recovery” was a plan announced by former prime minister, Scott Morrison, to expand the use of gas to rebuild the economy after the pandemic.
“Last time we tried a gas-led recovery under Covid, nothing happened,” Wood said. “None of it happened. Nothing happened. If anything, gas prices continued to steadily rise.”
At the last election, Labor frontbenchers promised electricity prices would be $275 cheaper by 2025. Prices have soared since that 2021 prediction, with Labor pointing to energy market volatility and international factors such as the war in Ukraine.
While the Albanese government has said its plan to extend energy bill subsidies until the end of the year will save households $150 – at a total cost of $1.8bn – ministers have not made predictions about an overall fall in electricity bills.
When asked exactly how much cheaper energy prices would be under a first-term Coalition government, Littleproud said “I am not going to be announcing that today”.
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“Our short-term solution is more gas, and you can do that in 12 to 18 months,” Littleproud said. “You can get that pressure into the grid. In the medium term, it’s about transitioning into nuclear energy.”
Gas is the most expensive form of electricity generation in the national grid, and responsible for about 21% of Australia’s emissions. Gas power provided about 5% of generation in the national electricity market, which covers the five eastern states, over the past year.
About 80% of the gas extracted in Australia is either exported or used by the export industry. The Coalition has previously flagged a demand for gas companies to increase supply to the domestic market before new projects and expansions are approved.
Independent senators David Pocock and Jacqui Lambie have both reiterated calls for more gas to be diverted to the Australian market.
“What we haven’t seen is the political will from the major parties who actually say Australians should benefit from Australian gas first before we export,” Pocock said.
Lambie has called for a 15% of all gas extracted to be reserved for Australian use.
“This is not about digging up more gas,” Lambie said. “This is not about ‘drill, baby drill’. This is about prioritising where our gas goes.”
The Australian Energy Market Operator has previously raised concerns about capacity problems on the east coast undermining the “gas supply adequacy” during peak winter periods. Moving gas from Queensland to southern states remains a challenge.
Littleproud said “there are some capacity constraints that we will lean into to make sure the gas is there”.
