Chris Bowen clinches 300 petajoule gas deals as Greens seek to sink gas code

The gas deals are equivalent to three years of east coast residential and commercial consumption but the government is facing pressure from the Greens over its gas code.

Wholesale gas prices are worth $12.29/GJ compared to $31.76/GJ at the 2022 federal election. Picture: Thinkstock

The Albanese government has struck new deals with major gas producers to secure enough supply for Australia’s east coast ­energy market for the rest of the decade, as the Greens attempt to sink the mandatory code of conduct imposed on the industry.

Climate Change and Energy Minister Chris Bowen will announce on Monday commitments from Australia Pacific LNG and SENEX to supply 300 petajoules of gas to 2030 – equivalent to half the annual total east coast domestic market demand – and almost 140PJ to the end of 2027, in a bid to fix a looming shortfall.

The commitments, which will be enforceable under the gas code, will be unveiled as Mr Bowen cautions the Greens and Coalition against abolishing the scheme that has facilitated the supply deal between the government and the energy companies.

The Greens will move to disallow the code, arguing it supports new gas fields amid a worsening climate crisis and benefits big gas users. The Coalition would not say on Sunday if it would support the motion. With the House of Representatives sitting for the final week of the year, Mr Bowen faces pressure from the Coalition to outline what the government’s expanded Capacity Investment Scheme will cost taxpayers.

On Sunday he played down suggestions it could hit taxpayers by “tens of billions of dollars” but refused to say if a cap had been set.

Noting the energy market operator and Australian Competition & Consumer Commission had warned there would not be enough gas to power factories, generate power, cook and heat homes in 2027, Mr Bowen said the supply agreements would help guard against that outcome and would be “crucial for avoiding a serious problem”.

“The new (gas) commitments will provide more affordable gas to the Australian market in the short to medium term and will provide the energy security that Australia needs as it makes its transition to net-zero emissions,” Mr Bowen said.

“If the Greens and Liberals team up and disallow the code and scrap these commitments, it will threaten energy security for millions of households and thousands of manufacturing jobs across the country. That kind of reckless and pointless peacocking risks domestic gas supply, higher prices, as well as manufacturing jobs and the energy transition.”

Mr Bowen was asked repeatedly on the ABC’s Insiders program if the government had capped the amount taxpayers would spend to underwrite 32 gigawatts in new renewables generation through an expanded CIS, to which he responded: “Well, of course, we have analysed how we expect these auctions to run, it will be treated in the budget statement of contingent liabilities and risks in a normal fashion … but this is the right policy for the right times to ensure emissions come down, reliability goes up.”

Opposition climate change and energy spokesman Ted O’Brien said it was a case of the taxpayer “underwriting Chris Bowen’s ego and so it’s no wonder they can’t put a cost on it”.

“Bowen continues to peddle the lie that Labor will deliver a $275 reduction in power bills despite prices rising as much as $1000 and his new scheme guaranteeing it’ll increase even further,” Mr O’Brien said.

“Labor’s plan is predicated on tens of thousands of kilometres of new transmission lines, and wind and solar farms carpeting regional Australia without gaining community support.”

Greens leader Adam Bandt said the government was pretending to tackle climate action while opening new coal and gas mines.

“We’re up for regulating the gas giants and ensuring gas isn’t sent offshore while Australian business transitions, but if Labor wants to just open new gas fields, they can talk to their mates in the Liberal Party about it,” he said.

“There’s plenty of gas in Australia to get business through the transition but Labor is sending it offshore, along with the profits, and then peddling Morrison-era spin that new gas fields are the only answer.”

Mr Bowen, who will head to Dubai in early December for the UN Climate Change Conference, will update the parliament on the government’s latest emissions projections later this week, showing Australia was now on track for 42 per cent emissions reduction by 2030 underpinned by the 82 per cent renewable target and other policies.