Designing a workable gas reservation scheme

by Tony Wood, Hamish McKenzie, Alison Reeve

01.07.2026 Submission
Share Bluesky Streamline Icon: https://streamlinehq.comBluesky
Submission to the federal government

The federal government wants its new gas reservation scheme to ensure that Australians have access to the gas they need at an affordable price. But several of the central proposals in the draft design are impractical or based on simplistic models of how markets respond to forced imbalances between supply and demand.

Download the submission

The good news that the draft framework can be fixed to deliver the gas that Australian consumers require at prices that avoid high and volatile international extremes, without onerous impacts on LNG producers and their customers. The scheme would still involve government intervention but be designed to deliver the objective as directly as possible while minimising adverse consequences. 

This Grattan submission identifies four major changes the government should make to the draft scheme to provide a more predictable market for producers and consumers. 

Tony Wood
Energy and Climate Change Senior Fellow
Tony is the Energy and Climate Change Senior Fellow at Grattan Institute. He was previously the Program Director, from 2011 to 2025, and before then worked at Origin Energy in senior executive roles for 14 years. From 2009 to 2014 he was also Program Director of Clean Energy Projects at the Clinton Foundation, advising governments in the Asia-Pacific region on effective deployment of large-scale, low-emission energy technologies.

Hamish McKenzie
Energy and Climate Change Deputy Program Director
Hamish McKenzie is the Deputy Program Director of Grattan Institute’s Energy and Climate Change program. With diverse experiences across academia, the electricity sector, and policy, he brings a practical approach to his work at Grattan.

Alison Reeve
Energy and Climate Change Program Director
Alison Reeve is the Energy and Climate Change Program Director at Grattan Institute. She has two decades of experience in climate change, clean energy policy, and technology, in theprivate, public, academic, and not-for-profit sectors.