27 April 2017

Manufacturing Australia meets with Prime Minister to discuss gas market intervention

Manufacturing Australia today met with The Hon Malcolm Turnbull, Prime Minister, to discuss the Federal Government’s intervention in the gas market, which, if implemented quickly and carefully, could provide a breakthrough in the gas and energy crisis threatening Australian manufacturing.

The Prime Minister announced the intervention while touring Incitec Pivot Limited’s fertilizer plant at Gibson Island near Brisbane, before sitting down with member CEOs and executives from Manufacturing Australia to discuss the policy and how it will be implemented.

The intervention comes as a growing energy crisis threatens jobs and investment throughout Australian industry. Australia has gone from having some of the world’s cheapest energy prices, to some of the world’s highest energy prices over the past decade.

Manufacturing investment is particularly at risk. Energy is one of the key input costs in Australian manufacturing. The more expensive and unstable our energy system, the more difficult it is to make the economic case for building new manufacturing plants, or making necessary re-investment in existing plants.

Quotes attributable to Manufacturing Australia Executive Director, Ben Eade:

  • On today’s announcement: “The Prime Minister has been right to intervene in the gas market in the national interest. If implemented quickly and carefully, this will be a breakthrough initiative in a long running national crisis. We still need to do more to encourage more supply and new gas producers into the market in order to lower prices, but the Prime Minister’s leadership is very welcome.”
  • On LNG exports: “We all support Australia’s growing Liquefied Natural Gas exports industry, but it is untenable for that industry to deprive Australians of competitively priced gas for their homes and businesses. The Federal Government should not relent in standing up for Australian households and businesses. It’s now up to producers to do the right thing by Australian customers.”
  • On the role large energy users: “Manufacturers and other large energy users are part of the solution. We can help to underwrite investments in new supply and support new producers into the market. But to do that the policy settings need to be right, ensuring local users see the benefit of increased production.
  • On what’s at stake: “This isn’t an energy problem: it’s a jobs problem. Manufacturing is especially threatened, but the fact is entire supply chains are at risk, from agriculture to food, infrastructure and housing. This is a crisis that threatens future industrial investment in this country across the board.”
  • On electricity: “Electricity costs in Australia have doubled in the past decade, while reliability has declined. A first world energy system must deliver reliable energy at internationally competitive prices. Driving down energy costs while maintaining reliability should now be the number one objective of State and Federal government energy policy.

Media contact: Ben Eade, Executive Director, 03 9023 9117