News

| June 17, 2022

Labor’s gas inaction forces Stawell brickworks to close

Escalating gas prices and the failure of the Andrews Labor Government to address a monopoly situation in Western Victoria has forced a long-standing Stawell business to close and is threatening the demise of another.

Advance Bricks and Pavers, a business with an 80-year history, this week made the heartbreaking decision to cease operating because sky-high gas prices meant it simply could not afford to trade anymore.

Nationals Member for Lowan Emma Kealy said the news was devastating for the business and for Stawell.

“I am gutted for everyone behind this business and for our community. To be faced with this situation – created by circumstances completely outside of their control – is incredibly difficult, and I extend my support to all those affected,” she said.

“I can appreciate the enormous uncertainty the owners and employees must be facing both from a financial perspective and in terms of securing new employment, and I sincerely hope, with the number of employment opportunities in the area, that everyone at Advance Bricks and Pavers is able to transition into new roles locally with minimal hardship and disruption.”

Ms Kealy said the economic benefits and employment opportunities that would be lost with the business’s closure would be immense, and were made even more disappointing with the knowledge that the situation could have been avoided if Labor had not failed to act.

“Over the past seven years, my colleague the Member for Ripon and I have repeatedly called for the Andrews Labor Government to address the monopoly situation in our communities,” she said.

“One retailer owns 100 per cent of the transmission capacity of the gas line between Carisbrook and Horsham, meaning customers have no choice. Furthermore, they can't access pay-on-time discounts or electronic billing discounts as they simply are not offered, because there is no incentive for the provider to do so as they know they cannot lose their customers to competitors.

“This lack of competition means residents in our electorates pay some of the highest gas rates in Victoria. The only way to break this cruel and unsustainable situation is for the government to step in, but they have continually failed to do so.”

Astronomical rises in gas prices are also threatening a fellow western Victorian manufacturing business, with their average price per gigajoule set to increase from $12/GJ to more than $42/GJ.

“The business’s gas supplier was suspended from retailing gas late last month because its investors had pulled the pin on their financing. The reason for this is because there is no certainty in the Victorian gas market, because the Labor government has failed to provide it,” Ms Kealy said.

“The government was meant to release its gas substitution road map in 2021, which would detail transition pathways and policy mechanisms to achieve Victoria's emissions reduction targets, including through more efficient use of gas and alternative gases such as hydrogen and biogas.

“But we learned last week that this plan has been shelved, leaving providers with no line of sight on what the future market might look like.

“It is this uncertainty that is exacerbating an already perilous situation in our communities.

“Furthermore, between 2014 and mid-2021, the Andrews Labor Government banned Victorian onshore gas supplies – withholding critical supply from the local market and causing a lack of investment in energy infrastructure over recent years. 

“This litany of failures has created a completely unsustainable situation, and I implore the government to take urgent action to ensure more businesses are not forced to close.”

The Federal Member for Mallee Anne Webster is also calling on the Victorian Government to address the monopoly situation and do more to increase and open Victorian gas production, and has urged Labor at a federal level to work with gas providers to avoid further disastrous consequences for manufacturing businesses.