Gas market rule breaches soar

The rules which help track the state’s natural gas supply-demand balance were breached almost 110 times in the last two years, the Economic Regulation Authority has revealed.

In a supplementary submission to the state’s domestic gas policy inquiry the ERA revealed 117 breaches of the state’s gas services information rules between the start of 2019 and the end of November 2023.

A total of 45 market participants were found to have breached the rules, and 29 were repeat offenders. Just nine of the 117 breaches were investigated before 2022, with 108 in the past two years.

The gas services information rules set out the roles of respective parties in monitoring the supply-demand balance of natural gas in Western Australia.

The data guides the publicly available Gas Bulletin Board and informs the Australian Energy Market Operator’s WA gas statement of opportunities which in December forecast a looming supply deficit.

“The ERA investigated 119 breach allegations of GSI rules in the past five years,” ERA chair Steve Edwell wrote in a recently published supplementary submission to the inquiry dated late last year.

“The ERA determined that there had been 117 breaches of the GSI rules and that there had been no breach in the remaining two matters.”

Human error was found to have caused 96 of the breaches, with a further 16 were the result of process deficiency. The remaining five were attributed to IT problems and other issues.

The majority of breaches (65) related to late payment of GSI invoices – billed quarterly – and 44 related to market information requirements.

The ERA confirmed two LNG exporters were being investigated for reporting a project’s nameplate capacity to the regulator, rather than the available 7-day production capacity.

The names of repeat offenders were not published despite a request from committee chair Peter Tinley for the details, due to legal restrictions guarding the confidentiality of market participants.

Supply opacity has been a key theme in submissions to the domestic gas inquiry, which is exploring the delivery and transparency of gas supply into the local market.

The inquiry has heard from offshore LNG producers, onshore gas producers and developers and key domestic gas customers using output for industrial applications.

It comes amid AEMO warnings of a gas supply deficit widening into the 2030s.

The committee is expected to hand down its findings at the end of May.