Economics is regarded as the social science that is concerned with the distribution, production as well as usage of goods and services. In economics, demand and supply are those factors that are said to decide price, producers would like to sell at a specific price i.e. supply, and customers will be able to buy the product by determining the price of the particular commodity. Supply refers according to the varying amount of commodities that producers will supply at various costs i.e. a more price yields a more noteworthy supply. Whereas, demand refers to the quantity of good that is demanded by consumers according to their price. As indicated by the law of demand, there is inverse relationship between demand and price as the demand increases when price decreases. However, according to law of supply, there is positive relationship between price and supply, whenever price increases the supply automatically starts to rise.
‘P’ denotes to Price and ‘Q’ denotes the Quantity of the product. The upward curve indicates the supply (S) and downward curve indicates the demand (D). The demand curve always shifts in a downward trend while the supply side goes in an upward trend. Surplus is the situation where the quantity supplied is greater than the quantity demanded.
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Energy consumption supports all parts of current society. Late supply interruptions and cost increments have focused on a production which is frequently underestimated. Australia's vitality framework is more difficult and various now than at any past time in mankind's history. The vitality area in Australia makes a significant commitment to the country's total national output, export earnings and work. A safe supply of reasonable, dependable and ecologically practical vitality is basic to Australia's future monetary development and success. Australia has a wealth and assorted variety of energy resources that supports domestic utilization and substantial fossil fuel energy trades far and wide. Australia keeps on having the world's biggest known financial uranium resources, the fourth biggest coal (dark and darker) assets and generous traditional and whimsical gas assets. There is great potential for further development of the non-inexhaustible asset base through new revelations. Recognized assets of crude oil, condensate and liquefied petroleum gas are progressively restricted and Australia is progressively dependent on imports for transport fuels. Australia additionally has plentiful and broadly conveyed breeze, sunlight based, geothermal, wave and tidal assets. Hydro energy resources have been broadly created, and wind, sunlight based and bio energy resources are progressively being misused for power age. Advances in renewable energy generation and storage technologies and better mapping of resource potential will be important for continued uptake, and so will technologies and policies for grid integration, sunlight based high temp water has bit by bit expanded, the other sustainable power source assets remain to a great extent undiscovered for power age. The usage of sustainable power source will keep on expanding altogether to around 2020, reflecting government arrangements (for example the Renewable Energy Target) and falling installing costs. Advances in renewable energy generation and storage technologies and better mapping of resource potential will be significant for proceeded with take-up and innovations and arrangements for grid integration. Geosciences Australia and the Economics Branch of the Department of the Environment and Energy, with help from the Australian Renewable Energy Agency, have created this incorporated logical and financial appraisal of Australia's non-renewable and renewable power resources. This production gives a preview so as to empower a correlation crosswise over vitality assets. This arrival of the Australian Energy Resource Assessment (AERA) is the first to be distributed in a web conveyed group. This new arrangement offers upgraded usefulness and simpler route. This change from print to computerized production is a piece of the progressing advancement of AERA to guarantee it keeps on giving important data to partners.
There are three main components of typical energy that affects price rise in Australia:
- Wholesale cost: it covers electricity being generated or extraction of gas.
- Network charges: paying for the consistent delivery of energy by the power lines or gas pipelines.
- Retail margin: paying for meter reading and other services.
The relationship between energy use and economic output can be described in terms of the energy intensity, or inversely, the energy productivity, of the Australian economy. Energy intensity measures the amount of energy used to produce a unit of economic output (energy consumption/GDP), while energy productivity estimates the amount of economic output produced per unit of energy input (GDP/energy consumption).
The rate of price increments for gas is relied upon to direct in many states and regions throughout the following couple of years after a time of critical incline. The government can straightforwardly impact just a little piece of value results. Intergovernmental understandings and activity by state and territory governments are the most significant arrangement switches to check future cost increments. Gasoline Prices in Australia increased to 0.98 USD/Liter in July from 0.97 USD/Liter in June of 2019. Gasoline Prices in Australia averaged 1.01 USD/Liter from 1998 until 2019, reaching an all-time high of 1.67 USD/Liter in March of 2013 and a record low of 0.46 USD/Liter in December of 1998.
The given figure depicts the price of gas in Australia ranges from 2008 to 2019 time period. We can clearly see that the price of gas in 2008 was almost 0.6 USD/liter that increased dramatically to 2013 (1.4 USD/liter) because the demand for gas was high in this year and then reached to the peak experiencing 1.67 USD/liter in between 2012 to 2014. Then after, the price of gas started decreasing as the demand decreased in a fluctuating trend till 2016 at 0.46 USD/liter (least price) during the given time period. The current price of gas is 0.98 USD/liter. There is an absence of supply and generation which have antagonistically influenced the estimating list of the gas because the price of gas is inclining quickly year by year. Australia is the nation that has probably the big industries which is generating gas absolutely from its own resources. The administration of Australia has taken the inception in their very own hands on the most proficient method to decrease the costs of the gas and satisfy the need of the individuals with the suitable supply.
According to the media report 2018, they are saying that price of gas in Australia has been the severe problem due to the many households especially in South Australia. They are arguing over ‘Does South Australia have the highest energy prices’ in the nation and ‘the minimum reliable grid?’.
There are three major components of a typical energy bill wholesale costs (covering electricity being generated or gas being extracted); network charges (paying for the reliable delivery of energy via power lines or gas pipelines); and a retail margin (paying for meter reading and other services).
Overall, energy has a noteworthy impact in Australians' lives, with two family units and organizations depending on different sorts of energy for warming, cooling, cooking, transport and machinery activity. Development in Australia's economy has prompted increments in vitality use, especially in extending ventures, for example, the mining business. Other variables, including a growing population, and the resulting increment in the quantity of family units requiring force and warming, have additionally added to this expansion. Australian Government intervention to straightforwardly influence price outcome is to a great extent limited to the effect of the carbon cost just as other renewable energy and vitality proficiency measures. Changes to energy prices from correcting these measures which would require administrative activity should course through, somewhat, to end clients. Australian Government activity can also be aimed at achieving intergovernmental participation to change administrative results and impact government-owned energy suppliers. One current policy discussion is about the benefits of a gas reservation approach to address value issues that are related with LNG exports on the east coast. There are various intergovernmental forms, especially through the Council of Australian Governments and the two key controllers, the Australian Energy Market Commission and Australian Energy Regulator. They have to address a portion of these difficulties. In any case, it stays to be seen whether they will be viable in containing increase of price in the medium term.
References
- https://www.abc.net.au/news/2016-08-01/gas-prices-higher-in-australia-than-in-export-destinations/7680106
- https://www.onebigswitch.com.au/campaigns/obsau-1908-energy-resi-origin-qld/energy_plans/query?utm_source=google&utm_medium=cpc&utm_campaign=Origin_July_1st_QLD&utm_term=%2Bgas%20%2Bprices&gclid=Cj0KCQjwy97qBRDoARIsAITONTIocTWTW7dn7ni-S2_dzocOq7EmVw_xPzNnnq8K_OL1C9JAi6O3WVMaAuz9EALw_wcB
- https://www.encyclopedia.com/social-sciences/applied-and-social-sciences-magazines/specialization-and-exchange
- https://aera.ga.gov.au/
- https://www.energy.gov.au/sites/default/files/gas-price-trends-review-report-revision2-mar-2017_pdf_5913_kb.pdf
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