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COAG Energy Council Reforms good news for advanced manufacturing - 19 August 2016

Australia’s manufacturing industry welcomes the market reforms progressed today at the COAG Energy Council, chaired by the Hon. Josh Frydenberg MP, Minister for the Environment and Energy.

Australian Industry Group Chief Executive Innes Willox said, “Secure and affordable gas supply is critical to industry, and we congratulate Ministers on taking hard decisions that will help to deliver it.”

PACIA CEO Samantha Read said, “The steps taken today at the COAG Energy Council are significant in addressing the concerns of commercial and industrial gas users including tight supply, high costs and a lack of transparency and competitiveness in the domestic gas market.

“A better functioning gas market is good news for advanced manufacturing, and good news for Australia’s economy.

“These concerns impact investment decisions by both Australian companies and multinationals, deciding where to build infrastructure and invest in research and innovation. Boards need to be able to answer the crucial question, is Australia investment ready?”, said Ms Read.

The AEMC Report together with the ACCC’s April 2016 Report into the East Coast Gas Market, present a roadmap to open up opportunities for new investment. The COAG Energy Council’s decision to adopt crucial recommendations that improve transparency, competitiveness and address part of the supply issue in the domestic gas market, will help business confidence.

“Gas is a vital source of energy for a range of industries, from alumina to food to steel fabrication. It plays an important role in balancing our increasingly renewable electricity system, and often shapes the price of power,” Mr Willox said.

Gas is also an essential feedstock ingredient in chemistry. The Australian chemistry industry uses 10% of all Australian domestic gas for its molecular properties to create a huge range of materials and products including: fertilisers to increase agricultural yields; secure piping to safely supply water and gas; and innovative packaging to keep food safe and fresher for longer.

“This is a high-value-adding and innovative industry that performs a unique enabling role in Australia’s economy, supplying inputs into 109 of Australia’s 111 industries. The COAG reforms are an important step towards transitioning our economy, and enabling Australia’s supply chains to be better positioned in a very competitive global landscape,” said Ms Read.

“Industry appreciates the strategic and coordinated approach taken by the COAG Energy Council to set a vision and a development plan for the Australian gas market.

“There is more to do. We urge the Victorian Government to reconsider the current moratorium on gas development, which threatens our future gas supply. Victoria is home to 29% of Australia’s manufacturing workforce[1]. It’s critical that there is a secure and affordable supply of gas, based on best environmental practice, for industrial feedstock and energy to enable industry to continue its valuable contribution to the State’s economy and communities.”

[1] 2014-15 ABS data



Media contacts:
Krista Imberger – [email protected] or 0439 318 290
Claire Selby – [email protected] or 0448 028 876

PACIA is the national voice for the strategically significant $40 billion Australian chemistry industry, one of the largest manufacturing sectors in the country. The industry employs more than 60,000 people and contributes more than $11.6 billion to GDP in industry value add. Ranging in size from small family-owned businesses to national and multi-national enterprises, PACIA members include chemicals manufacturers, importers and distributors, logistics and supply chain partners, raw material suppliers, plastics fabricators and compounders, chemicals and plastics recyclers and service providers to the industry.



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