Bert Van Manen (Forde, Liberal Party) Share this | Link to this | Hansard source

My question is to the Minister for Energy and Emissions Reduction. Will the minister update the House on how the gas-led recovery supports the Morrison government's plan to create jobs and secure affordable and reliable energy?

Angus Taylor (Hume, Liberal Party, Minister for Energy and Emissions Reduction) Share this | Link to this | Hansard source

I thank the member for his question. He knows we are absolutely focused on delivering affordable, reliable gas for hardworking Australians, including in his electorate of Forde. He knows that an affordable, reliable supply of gas is crucial to powering our way to recovery, job creation and the investment we need. He also knows that gas keeps the wheels of industry turning, including in his electorate.

Even before COVID struck, we were seeing significant reductions in gas prices at the wholesale level—42 per cent reductions—and we have seen further reductions since then. It has recently been confirmed by reports from the AER, the Australian Energy Regulator, and the ACCC, and they both point out that this is helping to put downward pressure on wholesale electricity prices. Again, before COVID struck there was a 40 per cent reduction in wholesale electricity prices.

At the same time, we know gas provides the firm power necessary to balance the record levels of investments we are seeing in solar and wind. Indeed, last year we saw a record level of investment in solar and wind—6.3 gigawatts of investment last year, $9 billion. The Clean Energy Regulator is expecting to see similar levels of investment this year. Far from competing with renewables, gas complements those renewables by helping to stabilise the grid and reduce emissions at the same time. Gas also provides that critical feedstock for industries like chemicals, like fertiliser for agriculture, like plastics for PPE—essential industries for this country.

There is more to do. We need to see those low spot prices, short-term prices and the lower international prices being passed through into longer-term contracts for their customers. Our competitive advantage as a nation has been, for many years, reliant on low-cost, reliable energy, and it is essential that we see our local manufacturers getting access to those longer-term contracts. We also need to see a strong supply of gas. We have seen a strong supply of gas in Queensland. We need to see in it the southern states. That's why we have entered into a state energy deal with the New South Wales government that includes a 70 petajoule commitment to gas in a market of 120. That will mean further projects and further supply in the southern states, which is essential for this country. When it comes to gas, we, unlike those opposite, know exactly where we stand. Unlike those opposite we are committed to the strong, reliable, affordable supply of gas necessary to create jobs coming out of COVID-19.