AUSTRALIAN
GAS PRICES ARE COSTING US OUR MANUFACTURING.

AUSTRALIAN
GAS PRICES ARE COSTING US OUR MANUFACTURING

CURRENTLY, AROUND 75% OF AUSTRALIA’S GAS IS EXPORTED, LEAVING OUR LOCAL MANUFACTURERS PAYING UP TO THREE TIMES WHAT THEIR COMPETITORS PAY OVERSEAS.

This pricing disadvantage is putting Australian jobs at risk and threatening critical industries. Without affordable gas, Australia risks losing key manufacturing industries and with them, thousands of jobs in the communities that depend on them. Industries like food production, building materials, fertilisers, packaging, steel and aluminium are all under pressure. These aren’t just businesses, they’re the backbone of communities across Australia.

Gas also plays a vital role in the energy transition. As renewables grow, gas backs up wind and solar, along with batteries and pumped hydro, to keep the lights on. Without affordable gas, the energy transition and our shift to cleaner manufacturing will stall and electricity prices will rise. Australia needs policy action to guarantee local access to fairly priced gas. This isn’t just about supporting manufacturers, it’s about keeping energy affordable and securing the jobs and industries that Australia relies on.

This pricing disadvantage is putting Australian jobs at risk and threatening critical industries. Without affordable gas, Australia risks losing key manufacturing industries and with them, thousands of jobs in the communities that depend on them. Industries like food production, building materials, fertilisers, packaging, steel and aluminium are all under pressure. These aren’t just businesses, they’re the backbone of communities across Australia.

Gas also plays a vital role in the energy transition. As renewables grow, gas backs up wind and solar, along with batteries and pumped hydro, to keep the lights on. Without affordable gas, the energy transition and our shift to cleaner manufacturing will stall and electricity prices will rise. Australia needs policy action to guarantee local access to fairly priced gas. This isn’t just about supporting manufacturers, it’s about keeping energy affordable and securing the jobs and industries that Australia relies on.

LET’S PUT AUSTRALIANS FIRST.

WHAT’S WRONG WITH AUSTRALIA’S GAS MARKET?

Australia’s gas market no longer works in the best interests of domestic customers and is crippling local industry. Despite being one of the world’s largest exporters, Australian manufacturers pay some of the highest gas prices in the world, often double or triple what US competitors pay. Since 2015, domestic gas use has fallen by 23% even as production doubled, because producers prioritise exports and leave the local market short.

A lack of competition, or transparency, restrictions on exploration and development and regulation that puts the interests of international customers ahead of Australian customers, have combined to drive prices up and erode our manufacturing base. The result has been plant closures, lost jobs and higher energy costs. Alarmingly, Australia is now the least manufacturing-intensive economy in the OECD (The Organisation for Economic Co-operation and Development).

AUSTRALIAN GAS PRICES ARE COSTING US A ‘FUTURE MADE IN AUSTRALIA’.

WHY DOES GAS MATTER TO MANUFACTURING?

Gas is essential for Australian industry. It’s a critical ingredient in fertilisers, plastics, chemicals and building materials. It delivers the very high heat that electricity cannot replace in iron and steel, cement and glass production. And it provides reliable backup for renewable energy, along with batteries and pumped hydro, as coal exits the grid. Without secure and affordable gas, many manufacturers cannot commit to long-term investments. That leads to plant closures, offshoring and weaker supply chains, undermining food security and Australia’s ability to remain self-sufficient.

AUSTRALIAN GAS PRICES ARE COSTING
US OUR JOBS.

WHY DOES GAS MATTER TO MANUFACTURING?

Gas is essential for Australian industry. It’s a critical ingredient in fertilisers, plastics, chemicals and building materials. It delivers the very high heat that electricity cannot replace in iron and steel, cement and glass production. And it provides reliable backup for renewable energy, along with batteries and pumped hydro, as coal exits the grid. Without secure and affordable gas, many manufacturers cannot commit to long-term investments. That leads to plant closures, offshoring and weaker supply chains, undermining food security and Australia’s ability to remain self-sufficient.

AUSTRALIAN GAS PRICES ARE COSTING
US OUR JOBS.

HOW GAS HELPS INDUSTRY DECARBONISE.

Gas is a bridge to net zero. While some industries and processes are already making big emissions reductions through direct electrification of their processes, for other industries, where gas is used as either a chemical feedstock or a source of very high heat, gas is essential.

In the steel industry, switching from coal to gas through a process called Direct Reduced Iron could cut emissions by up to 60%, an enormous reduction. In industries like fertiliser, chemical production and steel, gas is a stepping stone to future hydrogen-based manufacturing processes.

In the electricity grid, firming capacity provided by gas is essential to integrate more renewables while keeping the grid stable as coal exits the system. Over time, existing gas infrastructure can be adapted for green hydrogen to power those manufacturing capabilities that aren’t suitable for electrification.

Without competitively priced gas, none of these emissions reduction opportunities will be viable, and Australia will lose some of the capabilities we want to have in a net zero economy.

AUSTRALIAN GAS PRICES ARE COSTING
US OUR ENERGY TRANSITION.

GETTING MORE VALUE FROM AUSTRALIA’S GAS.

Australia has the reserves and capacity to meet both export demand and local needs, we don’t have to choose one over the other. By ensuring a fair share of supply is reserved for domestic users, we can keep prices affordable, secure local jobs and strengthen the industries that underpin our economy, while still maintaining a strong export market.

Other countries show this balance is possible. In fact, Australia is a global outlier amongst gas-rich nations. Other nations blessed with huge gas reserves like Australia have policies in place to make sure domestic customers are put first. Western Australia’s domestic reservation policy has kept local prices lower without harming exports. With the right settings, Australia’s Eastern States can do the same; supporting manufacturers, protecting households and maintaining our position as a reliable global supplier.

This is about a smarter approach that works for everyone: producers, industry and the Australian community.

AUSTRALIAN GAS PRICES ARE COSTING
US WORKING COMMUNITIES.

GETTING MORE VALUE FROM AUSTRALIA’S GAS.

Australia has the reserves and capacity to meet both export demand and local needs, we don’t have to choose one over the other. By ensuring a fair share of supply is reserved for domestic users, we can keep prices affordable, secure local jobs and strengthen the industries that underpin our economy, while still maintaining a strong export market.

Other countries show this balance is possible. In fact, Australia is a global outlier amongst gas-rich nations. Other nations blessed with huge gas reserves like Australia have policies in place to make sure domestic customers are put first. Western Australia’s domestic reservation policy has kept local prices lower without harming exports. With the right settings, Australia’s Eastern States can do the same; supporting manufacturers, protecting households and maintaining our position as a reliable global supplier.

This is about a smarter approach that works for everyone: producers, industry and the Australian community.

AUSTRALIAN GAS PRICES ARE COSTING
US WORKING COMMUNITIES.

HOW CAN WE FIX THIS?

Fixing the gas market requires a package of reforms backed by legislation to ensure transparency and fairness for all.

Introduce a national gas reservation policy to secure a portion of production for local users, ensuring affordable and reliable supply without harming exports.

Unlink domestic prices from export markets so Australians don’t pay inflated export rates or cover the cost of export infrastructure. Ensure local customers are supplied at reasonable, globally competitive prices.

Enforce an annual net contributor test to ensure LNG producers maintain their historic commitment to supplying the domestic market. LNG producers’ own gas use should not count toward this obligation.

Accelerate approvals for gas development projects through streamlined, evidence-based processes so new supply reaches customers quickly and gets gas flowing where it’s needed.

Support critical infrastructure with measures such as offtake guarantees, grants, or targeted incentives and fast-track priority gas pipeline and storage projects.

Secure stronger commitments from LNG exporters to guarantee fair domestic pricing and avoid local shortages.

Introduce a scheme to make locally produced gas more affordable for manufacturers, to support continued investment in their operations.