Setback for Duke in battle with ACCC

Duke Energy suffered a setback in its fight with the Australia Competition and Consumer Commission (ACCC) after the Australian Competition Tribunal dismissed its appeal of the ACCC's decision on the Queensland Gas Pipeline.

The American giant sought a review of the ACCC's decision, which rejected Duke's access arrangement and approved its own. Access arrangements refers to the terms and conditions under which other parties could transport their gas through Duke Energy's pipeline.

Duke argued before the Tribunal that the Queensland gas law removes the ACCC's power to include a provision in its access arrangement that would allow the ACCC to review substantial parts of the access arrangement if certain major events occur.

The Tribunal held that the ACCC retained the power to review non-price elements of Duke's access arrangements should an event such as the interconnection of a major new pipeline with the PNG Queensland Gas pipeline.

"Its is crucial that the ACCC retains the power to review non-price elements of Duke's access arrangement before the first review date, if justified by the occurrence of a major event," ACCC chairman, Professor Allan Fels said.

"Without the ability to review the access arrangement the important 'non-tariff' elements of the access arrangement would be effectively locked away until the first review, which may not occur until 2016."

However Duke described the intervention by the ACCC as "unnecessary" and a "disincentive" that discourage pipeline companies from investing in major transmission infrastructure. Many commentators believe the tribunal's decision has implications for the carriage of gas in Queensland, especially if the multi-billion PNG gas project goes ahead.

The ACCC regulates gas transmission pipelines under the National Third Party Access Code for Natural Gas Pipeline Systems.