STEVE PRICE: We heard this morning the Federal Government's aiming to bring down gas prices, that's as well as bringing down electricity prices, which was an election promise. The way they're going to try and do this is have a review of domestic supplies, and look at establishing a national reservation scheme. There'll be an announcement made later today - a joint announcement by Josh Frydenberg, the Resources Minister Matt Canavan and Energy Minister Angus Taylor. I do note the final decision on having a national gas reservation scheme won't be made until February 2021. The Federal Energy Minister is on the line. Thanks for your time, Minister.

ANGUS TAYLOR: Thanks for having me, Steve.

STEVE PRICE: Yeah, it’s my pleasure. The Opposition, in particular, I think it was, say today that you had to be dragged kicking and screaming to get to this position. Is that right?

ANGUS TAYLOR: Not at all. Not at all. I mean, look, we know how important affordable energy and affordable gas is, not just for all the households out there that use gas, particularly in the southern states, but for business. I mean, it's a crucial fuel to make sure we've got industrial jobs. We heard the message loud and clear at the election that industrial jobs in regional areas are absolutely essential, and that's why we're doing this. We've got to make sure there's enough gas in the market for domestic users, households, small business and large businesses that supply, that provide those jobs. That's a priority for us. We put in place the Domestic Gas Security Mechanism. It was the first step. It made a difference. It took the edge off the wholesale prices - there's no doubt about that - but we need to go further now and that's what this is all about.

STEVE PRICE: So why does it take so long?

ANGUS TAYLOR: Well, there's a whole range of initiatives here, that's just one. It's a big move to say to the energy companies: ‘We need to make sure there is enough gas available in the domestic market’, which we're saying, but also to impose regulation around it. But in the meantime, there's a lot-

STEVE PRICE: I would have thought that'd be a given though.

ANGUS TAYLOR: Well, it is.

STEVE PRICE: I mean, surely, surely we come first, don't we?

ANGUS TAYLOR: Yeah, of course, absolutely right, and that is exactly the point, Steve. I completely agree. It's the mechanism you put around it. We already have one - the Domestic Gas Security Mechanism and it's the next stage of that, which is being looked at as part of this work. But look, that doesn't stop a lot of work that has to keep going in the meantime and the single biggest thing we can do in the short term to make a difference here is lift the restrictions in the states. The worst of those restrictions is in Victoria, where there is a ban on gas. This is a state that is pumping solar and wind into the system at a record rate, continuing to do it. It is bulldozing down its coal-fired power stations as we saw in Hazelwood and has banned gas exploration and development. So we've got to see that go quickly. That can make a real difference.

STEVE PRICE: So that comes to a states' rights issue, does it, because the states own the resources, don't they?

ANGUS TAYLOR: Well, they do, but at the end of the day, I mean, we have an interest as a Commonwealth Government in the jobs and the affordability of energy more generally, so-

STEVE PRICE: Yeah, but good luck getting Daniel Andrews to agree to anything. So, what is the situation exactly there? And then we'll get on to New South Wales. So there's offshore gas exploration, offshore from Victoria, but there is a ban on onshore gas exploration. Is that the fact?

ANGUS TAYLOR: Yeah, well, it's slightly worse than that. At the moment, the gas and for many, many decades, the gas has been coming out of Bass Strait and in large quantities, and it's been very affordable. That's all changed. That's running down and it's going to continue to run down in the coming years, and we need to replace that in Victoria with affordable or new sources of gas. A lot of that gas is onshore and they've banned it. It's as simple as that. They've banned it. That ban needs to go.

STEVE PRICE: How are you going to get that ban lifted?

ANGUS TAYLOR: We're going to continue to pressure the Victorian Government. But look, I'll tell you what we'll pressure-

STEVE PRICE: It's like banging your head against the wall with them though.

ANGUS TAYLOR: Well, I tell you what will pressure them is that jobs are going to continue going, electricity prices will be unmanageable, and this is the one that will really hit soon, is if they don't have good gas generation in the state, then the lights will go out. I think this summer is very high risk for Victoria, so I think the political pressure will continue to mount on the Victorian Government to act on this, they must. This is absolutely crucial. They've gone from being a state where gas costs $3 a gigajoule, to more than three times that and that's completely unsustainable.

STEVE PRICE: But your side of politics runs New South Wales, they're not much better.

ANGUS TAYLOR: Well there have been problems, there's no doubt about that. We're seeing progress now on the Pilliga project-

STEVE PRICE: Will that go ahead?

ANGUS TAYLOR: We'd like to see more gas supply coming on and that's a good project to do it. We'd also like to see, the other project that is in the pipeline, they're working on it, is an import terminal. We need more supply - that's the long and the short of it. The initiatives we announced today are primarily focused on getting more supply into the market and making sure there's enough gas to meet domestic needs, and of course, in New South Wales, there are projects that are there now, that they can they can start bringing through.

STEVE PRICE: So it seems quite incredible that we're having this discussion. We are the largest exporter of liquid gas in the world are we not?

ANGUS TAYLOR: Yes, we are. We've just beaten Qatar.

STEVE PRICE: And you and I are sitting here having a discussion about how we haven't got enough yet.

ANGUS TAYLOR: Yeah, look, I hear you Steve. We've just passed Qatar, we're ahead of the United States and we are a big gas exporter and that's a great contributor to our economy, but it should not be at the expense of domestic customers, big and small, and that's why we are announcing these initiatives.

STEVE PRICE: So part of the problem is the contracts that were signed are still in place and can't be broken - is that the problem?

ANGUS TAYLOR: It has been a problem, but worse than that, commitments were made offshore to customers without having the gas supply shored up onshore - and you know that - we can't allow that to happen again. That's history. What we've got to do now is make sure there's enough gas now for the domestic market.

STEVE PRICE: What's the Federal Government's attitude to fracking?

ANGUS TAYLOR: It's like any technology, it's not about the technology, it is about the environmental outcomes. We want more gas coming on. There's lots of different technologies for extracting gas. The question of whether an individual project is a good one or a bad one for the environment needs to be assessed properly, needs to go through the process. That process shouldn't be prolonged, it should be done as quickly as possible to make sure the good projects do come on.

STEVE PRICE: The Americans have embraced that particular way of extracting minerals to their advantage and they're now almost completely self-sufficient, are they not?

ANGUS TAYLOR: It's even better that - I mean, not only have they got low gas prices, they are reducing their emissions faster than most countries in the world because of that access to gas. Choosing a technology and banning is not the way to go about this, if that's your question. That is not the way to go about it.

STEVE PRICE: Has the green movement been too vocal and been too successful in locking up those supplies?

ANGUS TAYLOR: They've been anti-coal and they've been anti-gas and you know this is the irony, is the green movement wants to see more solar and wind in the system, but you've got to back up solar and wind for what happens when the wind doesn't blow and the sun doesn't shine. Gas is, along with hydro, is the way to do that. Now banning technologies or banning gas outright which we're seeing in Victoria is disastrous. It is bad policy and those policies should be gone in Australia as quickly as possible.

STEVE PRICE: Last time I spoke with you, I think it was on Breakfast, we talked about how the election promise was to bring down energy prices for domestic consumers. That's hanging over your head. Are you still convinced you're going to be able to do that?

ANGUS TAYLOR: Yeah, sure - I am - and look the key to this is not just the price regulation at the retail level, which we've been doing in price caps, but it's getting the wholesale market right, and that means more supply and keeping our supply in. I was pleased, we made good progress with AGL just in the last week or so, with them committing to keep a big gas generator on in South Australia and also extending the life of Liddell. There's more discussions to have about all of that, but we've got to keep our supply in the market going flat out and over time then we can bring new supply to the market to drive prices down.

STEVE PRICE: So we did discover, and I spoke to Canstar yesterday, that some of these companies while advertising and recommending that their electricity prices were coming down, were boosting gas prices at the same time. I mean are you keeping an eye on the way that retail businesses are being run?

ANGUS TAYLOR: Look and I have heard that now from a lot of people, from people in my electorate and you know this is a real concern. If what they're doing is bringing electricity prices down - and we did see a reduction in the latest CPI figures in electricity - but they're masking that with increases in gas, that's unacceptable. And we, this is part of the reason why we are going through this process now of pushing gas prices down, making sure there's enough supply there for domestic use at an affordable price.

STEVE PRICE: Good on you, I know you're busy. Thanks a lot.

ANGUS TAYLOR: Thanks Steve.