Southeast Australia facing possible gas shortage in 2023 winter: report

A sign outside a petrol station shows the price of petrol breaking through the two Australian dollar (1.46 USD) a litre mark in Melbourne on March 3, 2022. (Photo: AP)

CANBERRA, March 29 (Xinhua) -- Southeast Australia could face a risk of gas shortfalls as early as 2023, a report has warned.

The Australian Energy Market Operator (AEMO) published its annual statement of opportunities report on Tuesday, which forecasts the supply and demand for gas over the next 20 years.

It found that Victoria, the state most dependent on gas for heating homes, Tasmania, New South Wales and the Australian Capital Territory (ACT) could be affected by a shortfall in winter 2023.

"A shortfall risk in the southeastern states in winter 2023 is forecast under extreme conditions, given ongoing production decline from Bass Strait, and pipeline capacity limits from northern Australia," Merryn York, AEMO executive general manager system design, said in a statement.

"This leaves reducing electricity generation from gas as the likely solution to manage shortfalls, unless actions identified in the 'step change' scenario, like switching from gas to electricity for residential heating and hot water, are taken quickly," she said.

Household gas use in Australia is about three times higher in winter than in the warmer months while electricity use peaks in summer.

AEMO said that in "Step Change", a gas shortfall can be narrowly avoided. Actions and investments that reduce gas demand (like switching residential gas heating to electric and improving buildings' energy efficiency) are needed quickly to deliver the forecast demand reductions.

"While these may be likely over time, the pace so far has been relatively slow, and urgent action would be needed to put southeastern regions on the Step Change path by next winter," AEMO said.

According to AEMO, existing and committed gas production in southern Australia is forecast to fall from 487 petajoules in 2022 to 360 petajoules in 2026.