Australia’s energy market operator will have powers to acquire gas in an emergency

Australia’s energy market operator will have the power to source and store gas for release in an emergency.

It was one of several measures federal and state energy ministers agreed to when they met Wednesday to discuss the gas crisis.

Ministers also agreed to prepare a national transition plan for the bumpy road to a clean energy economy.

And work on a “capacity mechanism” must be advanced as a priority. This mechanism would provide incentives for dispatchable power to improve reliability as the system transitions to renewables.

It was unclear whether coal and gas would be excluded from the mechanism.
Federal Energy Minister Chris Bowen said the meeting, which included Labour, Liberal and Green ministers, was marked by consensus and teamwork.

But he stressed that there was “no silver bullet” to the current crisis. “We need more transmission, we need more renewables, we need more storage,” he said.

Gas reservation policy not discussed

Ministers only discussed initiatives involving the federal and state governments. This ruled out consideration of an east coast reservation program, which would be solely the responsibility of the federal government.

The meeting received briefings from market regulators and operators on prices and volatility in the energy sector and potential actions that could be taken.

Ministers agreed that their governments must be ready to implement new measures, but said they must comply with national and international commitments.

They expressed their confidence in the energy market organizations that operate and regulate the system.

Read more: 4 reasons why our gas and electricity prices are suddenly skyrocketing

Australia’s energy market operator is to provide an urgent update on the gas supply and demand situation on the east coast, identifying any market constraints. He will advise the July meeting of energy ministers on further action needed.

This meeting will receive advice from the Australian Energy Market Commission on improving system resilience and better managing retailer failures.

The Australian Competition and Consumer Commission will also provide a report to ministers.

Read more: Why have gasoline prices gone from $10 per gigajoule to $800 per gigajoule? An energy crisis expert who crosses Australia

Bowen told a press conference on Wednesday night that the meeting was never designed to fix all the issues, but gave regulators “more tools to do the necessary work.”

Treasurer Jim Chalmers again ruled out a super-profits tax for gas producers benefiting from soaring international prices.

He also rejected calls for Australia to consider developing nuclear power, saying the economy was not working.

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