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Pragmatic move on transition fuel

After worrying consumers and taxpayers by asking for a blank cheque to underpin his Capacity Investment Scheme, Climate Change and Energy Minister Chris Bowen has made an important, constructive move. He has struck new deals with major gas producers Australia Pacific LNG and Senex Energy to secure sufficient supply for Australia’s east coast energy market for the rest of the decade. Gas is an important transition fuel on the path to net-zero greenhouse gas emissions. The nation has plenty of it, and it makes sense to use our comparative advantage for local supply and for boosting export revenue.

Showing zilch economic nous, Australian Greens leader Adam Bandt says his party favours “ensuring gas isn’t sent offshore while Australian business transitions, but if Labor wants to just open new gas fields, they can talk to their mates in the Liberal Party”. Too right – the sooner exploration and development of new gas fields are stepped up, the better. While the Greens revert to their natural habitat as fringe protesters, exploring for and using a vital resource deserve bipartisan support from the main, economically rational parties.

Mr Bowen’s sensible announcement comes as new modelling from EY commissioned by Australian Energy Producers – the nation’s peak oil and gas group – shows substantial domestic production still will be required by mid-century. The report promotes gas as a “safety net” underpinning Australia’s clean energy transition.

Demand for gas could increase by 30 per cent on current levels by 2050, the report says, if the rollout of renewables were more limited. After examining about 350 net-zero pathways from around the world, EY urges Australia to prepare for multiple gas production scenarios. The resource will play “a major role in the net-zero transition”, it says. Such an approach makes sense, especially to those sceptical about the feasibility and cost of the installation of 22,000 solar panels every day and 40 wind turbines a month and tens of thousands of kilometres of new transmission lines until 2030.

Ahead of attending the COP28 UN climate conference that starts in Dubai this week, Mr Bowen, in addition to pushing forward on gas, owes it to taxpayers to reveal what the government’s Capacity Investment Scheme will cost. On Sunday he refused to say in an ABC interview whether the government had capped the amount taxpayers would spend to underwrite 32 gigawatts in new renewables generation through an expanded CIS. Taxpayers are entitled to be told of the cost involved.

Read related topics:Climate ChangeGreens

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Original URL: https://www.theaustralian.com.au/commentary/editorials/pragmatic-move-on-transition-fuel/news-story/011fed1a53ef76d082c5bd234e7899fa