A choice: socialists, or scientists, on gas?
There is a new pragmatism taking hold regarding the central role gas must inevitably play in the rush to decarbonise the electricity network. It was best summed up by South Australian Premier Peter Malinauskas, who told the Energy Nation summit: “Do we want policy by the socialists or the scientists?”
It is no moot point. There has been a decade-long campaign to delegitimise the role of gas as a transitional fuel by protest groups that have eyes only for renewables. Much of it has been directed towards slowing development of the Narrabri gas field in NSW that has enough reserves to solve the east coast’s gas shortfall crisis.
Mr Malinauskas was clear on Wednesday that the Santos-owned project was central to solving energy problems not just for NSW but for SA as well.
South Australia’s transition to renewables is made possible only because of the capacity of gas to firm the renewables heavy grid.
“My support for gas is underpinned by my support for net zero,” he said. “Batteries alone are not going to be able to firm the grid to the extent that is necessary. Eco purists must be careful what they wish for.”
His view is supported by industry and the NSW Premier, Chris Minns, who said Narrabri was crucial for the industrial base in the Hunter Valley and a key part of the energy jigsaw puzzle.
The need for more gas was a unifying theme at the summit.
Santos chief executive Kevin Gallagher said everyone was coming to the same conclusion that gas was a “critical enabler”.
Victoria was singled out as the epicentre of the east coast gas shortfall and energy policy failure. Samantha McCulloch, chief executive of the Australian Energy Producers, said it had been a disaster unfolding in plain sight as bans had been put on exploration by the Daniel Andrews government, as existing production fields were in steep decline.
The challenge now is to get more gas into the system.
Cecile Wake, Shell country chair and executive vice-president, said industry was united on the need for more domestic gas supply. But she said it was “getting increasingly difficult to execute any investment in Australia”.
“There is a need for greater regulatory certainty”, she said.
That might include a gas reservation policy to maintain domestic supplies.
But the industry is laying down hard markers about what that must involve.
“Support for a reservation plan is anchored in increased supply and regulatory reform”, Wake said.
“We have to put ideology to one side and decide how do we get more energy in all forms for local and export buyers”, she said.
These are the decisions that must be taken by the federal government as it moves to transform gas regulations and the Environmental Protection and Biodiversity Conservation Act.
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