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Turnbull acts on Australia’s looming gas supply and energy crisis

fuelPrime minister Malcolm Turnbull announced he has called upon gas companies to explain how they are going to secure future supplies as Australia heads towards an energy crisis.

He will meet with executives from the major gas companies next week to discuss a looming shortage, which could impact on businesses and households.

“They have been put on notice,” Turnbull told 5AA radio in Adelaide on Friday. “I will be demanding from them their explanation how they are going to deliver security for their customers.”

The Australian Energy Market Operator is warning of a shortfall in gas-powered electricity in NSW and South Australia from the summer of 2018/19 onwards. It would start hitting Victoria’s power supply by 2021 and Queensland from 2030, the regulator has warned. Key players in the market have also warned Australia is running out of power and prices are likely to rise further.

“The time for talk is over,” opposition leader Bill Shorten said on Friday, a day after the prime minister announced he was calling a meeting of key figures in the gas production sector.

Shorten said the meeting should include the states that have control of gas exploration and production. However, that’s not good enough for the opposition leader.

“This is an issue that demands immediate government action,” said Shorten. “It beggars belief [Turnbull] has done nothing while this crisis has escalated.”

The prime minister has talked down the idea of gas reservation as it could jeopardise investment and amounted to changing the ground rules after companies had spent millions on exploration and development. But the government would “consider all measures” to provide energy security.

Turnbull called on all political parties, including his own, to overturn their objections to unconventional gas development.

“We have so much gas – the problem is the political opposition to its exploitation,” he said.

Treasurer Scott Morrison acknowledged there had been a failure of planning over a long period of time.

“It’s an energy debate driven by ideology and not engineering,” he told ABC radio. “We can’t have this ideological approach to securing our energy future.”

Morrison noted five coal-fired power stations would realise their economic life in the next 10 years and they accounted for the equivalent of half of NSW’s peak capacities.

“You’ve got to be working all these angles whether it be gas, solar, coal,” he said.

Multinationals are “making a killing” from shipping Australian gas overseas, putting pressure on domestic supply, the Victorian government said.

“We need to now turn our minds to putting the interests of domestic energy consumers first, ahead of multinational companies that are making an absolute killing by digging up the ample supply of gas that we’ve got in our country,” Victoria’s energy minister Lily D’Ambrosio told reporters on Thursday.

Both the minister and premier Daniel Andrews called on Turnbull and federal Resources and Energy minister Josh Frydenberg to show leadership and develop a national energy security policy. Andrews was contacting Turnbull on Thursday for a meeting with other premiers on the issue.

“The fact of the matter is Victoria exports well over half of its gas to chase the highest price, whether that’s in Australia or other parts of the world,” Andrews told reporters.

“We want to have a proper debate about these things that relate to a domestic reserve, are we going to keep a portion of our gas for our consumers, our jobs and our future.”

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