Australian businesses are warning they will collapse if a long-term plan is not implemented to mitigate soaring gas and electricity costs.
Energy Minister Chris Bowen has cautioned Australia is on the precipice of a gas crisis, and has left all options on the table to curtail the rising cost of gas and electricity, including a controversial "gas trigger" to requisition supplies of gas intended for export.
Energy prices were already high due to increasing international demand as nations around the world wean off Russian gas and coal, but a severe cold snap, the collapse of a gas supplier last week and problems with some coal stations in Australia have also contributed to increase the pressure on gas prices domestically.
Jason Fritsch, the CEO of the nation's largest tomato processing company Kagome in Victoria, said something needed to be done urgently to curtail prices.
"If gas prices are to stay where they are now — then we're all dead," he said.
"We are very concerned as a group, and this is not just Kagome, but this is the manufacturers, the processors and anybody that needs to use gas as an energy supply to do what they're doing — where this is going to end up in the next 12 months to two years."
Energy Users Association CEO Andrew Richards said price pressures were being felt across all industries, and warned prices would continue to be passed on to consumers if nothing changed.
"These people make food, they make beverages, they make paper and steel and concrete. These are things we need every day. And they are all going up. And that has a significant impact on cost of living," he said.
"This is not a theoretical exercise — this is real, it's not a drill, and it's starting to bite very hard both at a household level and a business level."
In 2017, the then-Turnbull government introduced changes that would allow the Commonwealth to force gas producers to direct more of their supplies to the domestic market.
But Mr Bowen said even if the government activated the so-called gas trigger immediately the extra supplies would not be available until January.
Invoking the policy also required consultation with industry before coming in to operation.
Andrew Richards believes the government should be considering changing how the mechanism works.
"We made many submissions when they were developing this. You need to link to the cost of gas not only just the supply of gas. You need to make sure it can have more of an immediate effect," he said.
"So these are the conversations we need to have with this new government.
Company pays $100 for customers to jump ship
The Australian Energy Regulator (AER) has also decided to pass on hefty increases to a benchmark power price, with the tariffs, known as default market offers, rising between 8.5 per cent and 18.3 per cent in New South Wales, up to 12.6 per cent in south-east Queensland and 9.5 per cent in South Australia.
One Energy company ReAmped has also sent an unusual warning to its 70,000 customers on the back of the major spike in power prices, which are expected to come into effect next month.
The company has offered its customers a $100 Woolworths gift card if they shift to another provider.
"We've been writing to you this week to stress the importance of switching to another energy retailer with different operational structures as soon as possible to try to avoid dramatically increased prices," ReAmped CEO Luke Blincoe said in the letter to customers.
"We are not exiting the market, but urge you to act while you can still find a better deal with another retailer, and if we can help, please let us know."
New gas supply essential to put downward pressure on prices: APPEA
The Australian Petroleum Production & Exploration Association Acting Chief Executive Damian Dwyer insisted that new gas supply is essential to put long-term downward pressure on prices.
"More supply is the solution, not more regulation," he said in a statement.
"We're investing in more gas despite years of moratoriums, bans and delays, but we need investment certainty."
Santos has spent more than $1 billion to get its new controversial project up and running in Narrabri, New South Wales.
CEO Kevin Gallagher has used the current gas shortage to outline his desires to accelerate the development.
"We have got most of the approvals in place, we are going through the last stages of that," he said.
"We can't do that any faster, we would need governments to help us with that."
He described the lack of new developments as "frightening" but Australian Conservation Foundation CEO Kelly O'Shanassy called on the new government to focus on developing other types of energy sources to address price problems in the market.
"The future of energy is renewable," she said.
"Renewable energy is fast to build, it's much cheaper and affordable, it's much better for our climate," she said.
Part of Labor's election platform was a pledge to accelerate the shift to renewable energy, but Mr Bowen has acknowledged most of those policies would not help in the short term.
"The previous government did not do the work necessary to increase renewables, to increase storage," Mr Bowen said.
"If we had more storage and more renewables and better transmission, we would be much better placed to deal with the current challenges."
Commonwealth, state and territory energy ministers will meet early next week to discuss other policy options to alleviate the price hikes this winter.
