SA gas prices set to plunge

WHILE South Australia is facing some of the highest electricity bills in Australia thanks to its heavy reliance on renewables such as wind and solar, households and small businesses connected to the gas network are seeing some significant cost savings.

Haydn Black

From Friday nearly 435,000 SA customers should expect to see an average reduction of between $144 and $750 respectively off their annual gas bills following the Australian Energy Regulator issuing its final decision on Australian Gas Networks’ South Australian access arrangement for the five year period to 2021.

The final decision provides for a 23% cut to gas distribution charges in real terms from July 1.

The charges make up about half the average residential bill.

“The savings are significant in anyone’s language, and come at a time when the cost of living continues to rise and impact on every household and business budget,” AGN chief operating officer Andrew Staniford said.

“The reduction in network charges will undoubtedly take the pressure off their respective gas bills, and as a direct result, will provide much needed relief to their household and business budgets.

"Never has there been a more relevant time for families to choose natural gas to fuel their household appliances - from the more traditional stoves, ovens, hot water services and heating to outdoor kitchens, barbeques and patio heating.

"The price drop considerably improves the affordability of natural gas and will be a boon for South Australia.

"Further, gas charges per unit of energy consumed become cheaper as you install more gas appliances in your home.

"So even if you are already connected to gas, now is the perfect time to connect more appliances to further reduce your energy costs."

AGN says the average household could save $319 per year by converting all cooking, hot water and heating appliances to natural gas.

The average customer uses about 18 gigajoules of natural gas per year.

Staniford said households and small businesses switching to gas was also good for the environment.

He said burning gas directly in a home reduced emissions by up to 85% compared to using electricity produced from coal.

"The improved affordability of gas combined with its environmental advantages makes natural gas a compelling proposition for every South Australian where gas is available," Staniford said.

"And that is being made achievable to more South Australians all the time by AGN's continual improvement and upgrade of its gas network."

AGN owns natural gas distribution networks in South Australia, Victoria, Queensland, New South Wales and the Northern Territory which deliver gas to more than 1.2 million Australian customers.

The news of the cut in South Australia, which primarily gets its gas from the Cooper Basin, comes amid concerns for the east coast gas market, with wholesale gas prices in Sydney reaching almost $29/GJ in the recent cold snap, leading to warnings about rationing.

Industrial groups say they are unable to secure gas contracts beyond 2017 and a shortage of gas is tipped in the 2020s.

New South Wales has enacted strict controls on CSG and Victoria has banned all exploration until at least November. Queensland, which has five of six LNG trains operating, has also banned underground coal gasification.

Even without the bans, exploration in Australia has fallen off a cliff.

Most read Archive



Most read Archive