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APA CEO says ACCC Gas Inquiry "should be binned"


Source: The Age, 20 October 2016

The $9 billion gorilla of Australia's gas sector has launched an attack on the government for pushing a range of policies aimed at boosting industry competition, arguing it could have the perverse effect of forcing up gas prices. The dominant pipeline owner in the country, APA Group, also said a report by the competition watchdog, which outlines measures to stem surging domestic gas prices, "should be binned".

Part of the ACCC's case relies on the argument that once the cost of establishing a new pipeline has been recovered, charges should then decline, arguing the pipeline owners are generating very high returns on their investments by not doing so.

Measures put forward by the ACCC and the Australian Energy Markets Commission include a wholesale gas market that concentrates trading at two primary trading hubs, a northern hub and a southern hub, the opening up of the pipeline capacity by establishing a wholesale capacity, and studying whether gas pipelines should be subject to price regulation.

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