The Council of Australian Governments (COAG) Energy Council requested that the Australian Energy Market Commission (Commission or AEMC) review the economic regulatory framework that currently applies to covered transmission and distribution natural gas pipelines across Australia. This framework has not been comprehensively reviewed since the inception of the National third party access code for natural gas pipeline systems in 1997.

This report sets out recommendations by the Commission to improve the economic regulation applied to full and light regulation transmission and distribution gas pipelines. If implemented in full, the package of recommendations will assist pipeline users and prospective users to negotiate lower prices and better terms for their gas transportation agreements. A broader range of pipeline services will be subject to access arrangements, prices for services will be set at more efficient and cost reflective levels, contract terms will be more balanced, greater information will be provided to pipeline users to aid their negotiations, and arbitration will act as a more credible back-stop if negotiations fail.

Previous AEMC reforms, such as the east coast gas review recommendations that the Gas Market Reform Group is currently implementing, have made it easier to buy and sell gas in the wholesale markets. This review adds to the AEMC's reform package by making it easier and less costly to move that gas to where it is most valued.