Australian Industry Group welcomed the Government's decision to pursue a prospective national domestic gas reservation policy following the advice of the Gas Market Review, and to consult with industry and other stakeholders to finalise a suitable design as soon as possible. We are ready to help in any way to get the most 
effective outcome possible.

Our members include businesses of all sizes in many sectors across Australia. For many, gas is an important direct input to their operations, as fuel for process heat or as feedstock for production. For all, gas is an important indirect input via the role it plays providing flexibility and backup in the electricity system. The security of gas supply and its affordability are vital issues for industry in Australia.

It is important to be clear about the goals of a gas reservation if we are to judge the likely success of a design. To us the key objectives should be:

1. Gas availability that is adequate to meet Australian needs for as long as they last, noting overall natural gas consumption will decline as the local and global economies decarbonise.
2. Gas prices that are as low as can be sustained, noting shifts in the geology and geography of gas production in Australia.
3. Gas prices that are not closely linked to international energy markets, noting that recent events in the Middle East and their ramifications in international energy markets underline the value of reducing Australia’s domestic exposure to such disruptions.
4. Policy should not inadvertantly undermine the investment necessary to meet demand. That requires the policy to be known and predictable before new investments and contracts are made; and to impose requirements that are able to be met while achieving reasonable commercial returns.