Gas prices have risen over the past week and are now up $US61 a million (AU$86.40 million) over the previous week, according to the Australian Energy Market Operator.
The rise in gas prices has been fuelled by a large supply shortage in NSW, which has caused widespread gas supply problems, with demand dropping significantly in the past few days.
NSW Gas is the main supplier of gas to the state, with the remaining gas to come from the Queensland-based energy giant LNG Group.
A recent survey showed LNG’s LNG-fired generation capacity was about 40% below the peak that was expected for the year, and that the company has seen a significant increase in its capacity to cope with demand.
This is because of the huge demand that NSW is experiencing from the LNG supply, and the lack of capacity in the state’s existing gas-fired plants.
LNG currently has no more than 50% of its capacity in NSW.
The NSW Government is seeking to restart gas supply through a new LNG project in the eastern suburbs of Newcastle and the Port Macquarie, but the Queensland Government has rejected the proposal.
A spokesperson for NSW Gas said the NSW Government had not received a formal response from LNG on the issue.
The spokesperson added: “NSW Gas has not been approached by LNG regarding its proposed LNG capacity expansion project, which will be under construction in the NSW Port MacQuarie.”
However, the spokesperson also confirmed that the Queensland Department of Energy and Resources had previously rejected a proposal for a LNG facility in the east, due to concerns about its proximity to the Port of Newcastle.
Loading “NSF will not consider the LPG project in NSW due to the proximity of the Port and its impact on NSW’s energy security,” the spokesperson said.
“However, we will consider the proposed LPG facility in Queensland when we receive the Queensland Energy Regulator’s written submissions on the project.”
This week’s gas price spike comes after gas shortages were declared across the country last week.
The Australian Energy Markets Authority said that over the weekend, there were about 100 gas shortages in Australia.
However, despite the shortages, gas prices remained relatively high.
The ANMA said on Monday that the price of gas rose over the last 24 hours, with wholesale prices for gas in NSW rising from about $US40 a litre to about $42.30 a litres.