This paper outlines how unlimited gas exports over the past decade have increased energy prices for Australians, worsened climate change and raised little money for the public. Most gas exports pay zero royalties and Australia’s petroleum tax collects less revenue than HECS.

The Australian Government’s response is a ‘gas reservation scheme’. While the details are currently being negotiated, this paper finds that the proposal in December’s Gas market review report looks unlikely to fix the gas policy mess.

Key findings

• The Gas market review (GMR) report has no specific goal or commitment to make gas cheaper. 
• Australia’s main tax on the gas industry, the Petroleum Resource Rent Tax is not mentioned at all in the GMR report.
• Cheaper gas makes gas companies less likely to develop new gas projects. Higher gas prices encourage new gas projects. The GMR claims both lower prices for consumers and higher gas prices for producers.

Key recommendations

• Adopt the Australian Council of Trade Union’s proposal for a straight 25% tax on gas exports. 
• Divert uncontracted gas to the domestic market.
• Ban new gas projects.