Climate change strategy to shift homes off gas long-term shifted until after the November election

A plan to shift Victorian homes off gas has been put on the backburner amid a desperate plea for more supply to be pumped.

Gas producers have been asked to pump more gas to Victoria due to concerns about skyrocketing prices and soaring use during winter cold snaps.

The SOS has been quietly issued at the same time as a government climate change strategy to shift homes off gas long term — supposed to be released this month — was shifted to the backburner until after the November election.

Among short-term options being canvassed by the Andrews government to deal with supply pressures includes whether more storage could be built to improve gas security during winter peaks, and boosting links to interstate supplies.

After years of inaction on increasing local supplies, onshore conventional gas exploration and production was also recently reopened, although experts say that should provide only marginal relief.

Gas producers have been asked to pump more gas to Victoria.

The gas industry says it has been hit with contradictory messages from government, which is trying to slash gas use to reach 2030 emissions reductions targets and net zero emissions by 2050, at the same time as it is worrying about short-term supply constraints.

Premier Daniel Andrews said on Tuesday there was enough gas in the tank for Victoria this winter, but restated his belief that there should be a national domestic reserve — meaning Australia only exports what it doesn’t need.

“We should not be competing against the world for our gas. That just doesn’t make any sense,” he said.

Energy ministers will meet on Wednesday to thrash out energy policy and discuss skyrocketing costs, with Mr Andrews’s call reinforcing his push for a national policy shift.

Chaos in the energy sector, largely caused by international conflict, comes as governments consider how to slash emissions while keeping the lights and heaters on.

Daniel Andrews says there is enough gas in the tank for Victoria.

The Andrews Government wants to effectively phase out most gas long-term in favour of electricity and some hydrogen and biomethane, and released an interim Gas Substitution Roadmap last year.

A final report — scheduled for June 30 — is unlikely to be released until after the state election.

Director of the energy program at the Grattan Institute, Tony Wood, said there was a long-term inevitability about phasing out gas from homes but that was a political nightmare due to ingrained use and costs of shifting people to electricity-based assets.

“The longer we put it off, the harder it’s going to be,” he said.

“Things are going to happen anyway, we are running out of gas (and) you can’t keep burning gas to meet your emissions reduction targets.”

Gas Energy Australia chief executive Brett Heffernan said the industry was already reducing emissions dramatically and urged government not to “throw the baby out with the bathwater”.

“With the closure of coal-fired power, gas is essential to keeping the lights on,” he said.

“Just this week, in South Australia, where they rely entirely on renewables like solar and wind, gas has been the only thing preventing multiple days of blackouts.”

Environment groups will be furious if the roadmap is pushed back until after an election, after Energy and Climate Change Minister Lily D’Ambrosio said last year it was critical to achieving interim targets set for 2030.

Victorian Greens acting climate spokesperson Dr Tim Read said the roadmap should be used as a tool to get Victorians off gas “as soon as possible”.

“At a time when the Victorian Labor Government should be going further and faster to transition away from fossil fuels, delaying this roadmap is the last thing Victoria needs,” he said.

“The Government could be doing things right now to reduce our need for gas, like broadening eligibility for subsidies for people to switch to reverse cycle airconditioning instead of gas heating.

Key issues raised by stakeholders about the Roadmap relate to who pays for the shift to all-electric, and how to ensure gas supply for peaking plants when coal power stations start to shutdown.

In briefings to the sector earlier this year, the government said that by 2030 households that were all-electric with efficient split systems would save $360-840 a year compared to homes where gas was part of the energy mix.

Participants were not provided information on how much it costs for households to switch over to that energy profile, or any detailed modelling on roadmap shifts.

But modelling for the central scenario modelled showed a reduction in gas-fuelled heating and hot water of more than 50 per cent by 2030.
This would require the installation of about 100,000 electric heating systems every year, for the next eight years, including about 35,000 a year in new homes.