Don't give gas the cold shoulder
18 July 2022
IF the disparity in energy supply and demand have illustrated anything over recent weeks, it's that governments should be broadening the suite of renewable energy sources at their disposal, not picking winners based on lacklustre form.
Pronouncements of phasing-out gas and, in the case of Victoria, ruling-out renewable gases for residential use, expose the gulf between rhetoric and reality.
With coal-fired power literally shutting down around us, renewables like solar and wind aren't filling the growing void.
Just this week, Australia's Special Advisor on Low Emissions Technology and former Chief Scientist Dr Alan Finkel noted that as we move with increasing urgency to phase-out reliance on coal-fired power plants and pivot toward solar and wind, natural gas will need to act as a "support role" to ensure reliable supply.
"The important role for natural gas is that it can ramp up very quickly, within minutes, so if the wind drops or the sun goes behind a cloud... you can run it as long as you need it," he told Bloomberg TV. "Natural gas, helping us to accelerate the deployment of solar and wind, can be very important. I don't think everybody does appreciate that.
"There is a pursuit of perfection to say get out of fossil fuels completely, and eventually we will. But for the next 10, 15, 20 years, being able to call on natural gas to firm up the solar and wind electricity in a country like Australia will enable us to develop and deploy solar and wind at enormous scale more quickly, than if we cannot call on natural gas."
Last year, all renewables combined provided 24% of Australia's energy. That's great, but it means there is a 76% shortfall. Most of that is coal. In the absence of gas, existing demands on electricity – let alone new expectations – cannot be met.
The added benefit is that the Australian gas sector is decarbonising. This means households and businesses can keep using the gas they know, love and rely on, without adding to the ever-increasing load expected of a future electricity system.
Australian gas producers and suppliers can deliver 100% renewable, net zero gas through the existing network of pipes, cylinders and tanks, with minimal changes required.
In fact, by 2050 the saving from this transition to hydrogen, for example, has been modelled at half – yes, half – the roll-out costs of electrification. According to Frontier Economics, that's $13.3 billion as opposed to a whopping $27.5 billion.
It's a little too convenient that often the fact that consumers will foot the bill for this new infrastructure gets lost, which comes on top of the costs for exploration, mining, refining, manufacturing, constructing and connecting the elements to make and store electricity... not to mention rewiring the grids to cope.
The ongoing energy crisis demonstrates that governments need to work with gas providers, not demonise them for a short-term PR bump. Embracing emerging gas technologies being developed right now is in the interests of all.
Beyond hydrogen, net zero gases like 100% renewable dimethyl ether is a game-changer. This green gas is produced from food waste, agricultural residues and landfill. Biopropane and biomethane are also net zero gases, which have the same chemical properties and function the same as LPG and LNG, but are 100% renewable.
Any arbitrary bid to sideline gas, ignoring these developments, could be catastrophic. Which brings us to Victoria's so-called Gas Substitution Roadmap.
Denying Victorians access to these new gases is a clear lost opportunity. But it also means switching in-home appliances from gas to electricity. That cost is entirely borne by home owners. Recent Frontier Economics data shows the cost of this is between $21,500 and $42,000 per dwelling – depending on type and size dwelling and appliances used.
All this for a less reliable power source.
Just last month in South Australia, where the state relies on renewables like solar and wind, gas was the only thing preventing multiple days of blackouts. That reliable back-up will be more important than ever in a decarbonising economy.
What is clear is governments cannot pursue electrification as the sole means to achieve emission reduction targets.
The simple reality is electrification cannot, and will not, do everything. Recent geopolitical events and natural disasters should be demonstrating the importance of having a diverse energy mix to maintain secure energy systems and absorb shocks.
The danger if this isn't approached sensibly is that the prevalence of widespread, persistent and repeated blackouts will be an ongoing reality for Victorians. That's why bedding down a consistent, reliable supply of gas – including renewable, net zero gases – is imperative.
Gas plays a significant role in Australia's energy mix, with over seven million households and businesses using LPG and natural gas for their daily needs.
The gas sector is already contributing to efforts to combat climate change and is well on the way to decarbonise through renewable gases. Governments need to recognise this transition and support the development of renewable gases as part of a circular gas economy.
We know consumers prefer gas for their cooking, heating and hot water. It's also essential in manufacturing, where it cannot be replaced as an industrial heat source nor as an ingredient in many of the products needed in modern life, like mobile phones, fertilisers, pharmaceuticals, plastics, rubber... to list just a few.
With gas clearly needed for our energy security; and gas companies already in transition to renewable, net zero gases; governments should be backing them in, not shutting them out.
Published in the Herald Sun, Courier-Mail and NT News newspapers, 18 July 2022.
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