The move comes ahead of the introduction of a deregulated retail market for gas in South Australia by mid next year.

The increased role for the Essential Services Commission of South Australia (ESCOSA) took effect today following proclamation last month of amendments to the State's Gas Act.

The Commission is now responsible for the regulation of South Australia's two main energy sectors, electricity and gas, in addition to seven of the State's main ports and third party access to the near-complete Tarcoola to Darwin rail line.

"Our intention is to evolve a gas regulation model as close to that as currently applies to South Australia's electricity market, deregulated on 1 January this year," the Chairman of ESCOSA, Lew Owens said.

"We anticipate a fairly common approach between gas and electricity regulation."

"The three largest energy retailers servicing, or intending to service, the State - AGL, TXU and Origin - each plan to provide the dual service of gas and electricity supply, so it makes sense to have synergies within the two regulatory regimes."

ESCOSA's new powers extend its regulatory authority to include price setting, operating codes and licensing for the retailing and distribution of gas throughout the State.

This will see the South Australian operations of the State's monopoly gas distributor, the listed Envestra Limited, come under the regulatory control of ESCOSA. The move comes as part of the 1997 agreement between State and Federal Governments setting the terms, conditions and timetable under which deregulation of the national gas market was to occur.

The interstate operations of Adelaide-based Envestra are not affected by today's regulatory changes.

Envestra - Australia's largest natural gas distribution company - owns and operates 7,000 kilometres of mains gas pipelines, and 300 kilometres of transmission pipelines throughout South Australia, supplying 42 petajoules of gas per year via gas retailers, to nearly 344,000 consumers.

Mr Owens - who has previously worked in the State's gas, electricity and energy reform sectors - said South Australia was a major user of natural gas for electricity generation, cooking, water heating and space heating.

"South Australia, due to its access for many years to Cooper Basin natural gas supplies, has an advanced gas distribution and retail market and should move readily to a full retail contestability (FRC) framework from mid-2004," Mr Owens said.

"ESCOSA plans over the next 12 months to finalise the regulatory systems and controls which can achieve such objectives."