Media Statement - 1st July 2008
The
Minister for Resources and Energy, the Hon Martin Ferguson AM MP, has
announced the commencement of the National Gas Law (NGL), a major
microeconomic reform for the Australian economy that came into force
today.
Minister Ferguson said: “The NGL is a cooperative legislative scheme regulating gas pipeline services throughout Australia. The NGL implements recommendations made by the Productivity Commission in its June 2004 Review of the Gas Access Regime and by the Expert Panel on Energy Access Pricing in its 2006 report Energy Access Pricing.
"The NGL was developed with the cooperation of the Commonwealth, State and Territory Governments through the Ministerial Council on Energy (MCE). I would like to acknowledge the work of my colleagues on the Ministerial Council in putting this scheme in place. Without their support this initiative would still be on the drawing board.
"The NGL brings natural gas pipeline regulation under the national energy market institutions alongside electricity network regulation. This means that the Australian Energy Regulator (AER) is now the national regulator for gas and electricity networks and that the Australian Energy Market Commission (AEMC) is responsible for developing rules made under both the National Gas and Electricity Laws. This will ensure consistent regulatory decision making across the energy sector and ensures that there is a common approach to the development of rules governing gas and electricity networks.
Minister Ferguson said the reform has long-term benefits for the Australian economy, both through lower carbon energy supplies and a reduced regulatory burden for suppliers.
“Natural gas is poised to play a growing and vital role in the Australian economy as we move to a carbon constrained market. We have to ensure that the much needed investment in new and existing gas infrastructure goes ahead. The National Gas Law delivers in this regard.
"The NGL also significantly enhances the regulatory environment for gas pipeline services. The introduction of a new set of pricing rules will ensure a more consistent approach to pipeline regulation and ensure the AER's decisions encourage efficient use of natural gas pipeline services."
The NGL continues the incentives for greenfields pipeline development assisting the building of new pipelines in areas not currently served by gas pipelines. It also introduces a new light-handed form of regulation that will reduce the regulatory burden for eligible pipelines. It also improves the rules to facilitate expansions of existing pipeline infrastructure, and the regime used by developers to bring gas to new markets. These initiatives improve the environment for investment in gas pipelines in Australia to ensure that there is adequate infrastructure to meet Australia's demand for gas.
"The NGL also implements an important reform developed by the Gas Market Leaders Group. From today, a new Bulletin Board will make information about the supply of natural gas publicly available. This will increase transparency and opportunities for trading in the gas market, and will assist in the management of emergencies," Minister Ferguson said.