This paper reveals that allowing unrestricted gas exports from the east coast of Australia has resulted in domestic wholesale gas prices more than tripling and electricity prices doubling, since exports began in 2015.

Until the mid-2010s, wholesale gas prices in eastern Australia were low. Prices were substantially below those paid in other countries, due to the ample supply, modest demand and, crucially, gas companies’ inability to transport Australian gas to international markets.

The Australian and Queensland governments’ decisions in 2010 to allow large-scale exporting of Australian gas from Queensland exposed Australians to high global prices, ending decades of abundant, low-cost gas for Australians, leading to higher energy bills, gas shortages and manufacturing closures.

Gas and electricity prices are closely correlated because in the National Electricity Market (NEM) the price of gas-powered electricity generation often sets the wholesale price of electricity, even though gas is used for only a small amount of total electricity generation. 

The paper proposes that the only way to bring down Australian gas prices is to reverse the mistakes of earlier in the century – restrict gas exports.