Review of small customer gas pricing and competition

We were directed by the Minister for Mines and Energy (the Minister) to review small customer gas pricing and competition in the Queensland retail gas market.  The review looked at market dynamics in relation to gas customers, incumbent retail market participants and new entrants.

The review focused on the following main issues in the small customer gas market:

• the current level of competition in the markets for reticulated natural gas and substitute fuels such as reticulated and bottled LPG
• the impact on retail prices of movements in prices and costs in the upstream gas market and whether current small customer retail prices were reflective of actual costs incurred in the upstream gas supply chain
• the extent of current small customer gas market activity, including customer switching behaviour, impediments to small customers exercising informed choices regarding their retailer of choice and consumer perceptions of natural gas as a product of choice compared to other energy supply options

We were required to:

• consider the effect of these issues on small gas customers in various categories
• comment on differences in  market competitiveness and cost reflectivity  between regions within Queensland, where relevant
• provide an analysis of differences in market competitiveness and cost reflectivity  between Queensland and other Australian states or territories.

We had to consider these issues with respect to different categories of small gas customers in Queensland.