While today has been dominated by housing policy, it is worth remembering that the Liberal Party’s gas policy has a few holes in it due to our extremely uncompetitive gas retail sector. It’s not just gas miners who are taking the piss.

Dutton’s plan for a gas reservation is finally a recognition that Australia does not have a gas shortage problem—it’s a gas export problem. More gas should be allocated to domestic users.

But Dutton’s estimate that retail consumers will benefit is problematic.

Under the Dutton policy, gas is reserved domestic consumption until “the price of wholesale gas out of Queensland” falls from $14/GJ to $10/GJ. He claims that will save residential customers 7% of their retail gas bill.

Here is the problem, Dutton assumes Australia’s retailers pay the price of wholesale gas. But AGL, the biggest retailer, pays just $8.20/GJ for the gas it supplies its 4 million gas customers. Dutton’s plan to lower gas prices to $10GJ won’t matter a hoot.

That’s too bad because AGL’s gas customers have been paying an average of $38.8/GJ plus GST. But 7% would represent a saving of around $3/GJ were it to materialise.

Origin’s figures are roughly similar.

In the 6 months to 31 Dec 2024 AGL’s wholesale gas costs were $11.5/GJ of which $8.2/GJ was AGL’s cost for gas purchases. The rest ($3.3/GJ) was “haulage, storage and other.”

AGL’s rip offs need addressing. AGL charges consumer customers $38.8/GJ (before GST) which is more than three times what it charges big business at $12.4/GJ. The difference cannot be justified.