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Victoria Facing Gas Shortages

by | Tue, Jul 19 2022

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The national energy market is facing a fresh challenge.

Victoria’s gas storage is being drained to reportedly dangerously low levels due to high winter demand – paving the way for another market intervention to secure electricity supplies.

Gas at the Iona storage facility, near Port Campbell in the state’s south-west, has dropped to near record levels, sparking fresh concerns about a gas supply crisis this winter.

The energy market operator AEMO has put an official security threat in place until the end of September, as levels at Victoria’s underground gas storage plant drop to record lows.

An emergency supply guarantee could also be invoked for the second time this year if things get worse.

The power grid operator is warning the system will remain unstable into early spring.

Victorians are also being warned they could be heading towards gas rations.

Energy Users Association Chief Executive Andrew Richards says, the more involved the regulator gets, the closer the state gets to rations.

“If it’s at the point where the market operator needs to step in, then we are potentially days away from it,” said Mr Richards.

“So… that’s how tight it’s going to get. The fact that the market operator sent a notice out to say I’m going to start potentially [having] to control these resources, then that’s a pretty critical level.”

The state’s Energy Minister has moved to reassure Victorians they won’t be left out in the cold this winter.

Lily D’Ambrosio says, the drain on supplies is being caused by increased demand from NSW for Victorian gas.

“The market operator will continue to monitor this, to ensure that the supplied gas meets the demand out there, and of course that is their job – to do just that,” said Ms D’Ambrosio.

Residents can expect their power bills to be impacted.

 

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