Allan government accused of ‘dropping the ball’ on biomethane and renewable hydrogen

The state government has been accused of “dropping the ball” on a “ready to go solution” that could unlock more renewable gas supply ahead of Victoria’s forecast gas shortfalls.

A “quick win” for Victoria’s gas supply that has the potential to power hundreds of thousands of homes by the 2030s is being wasted as the Allan government sits on a key directions paper.

Pressure is mounting on the state government to unlock more renewable gas supply such as biomethane and renewable hydrogen ahead of forecast gas shortfalls.

A “quick win” for Victoria’s gas supply is being wasted as the Allan government sits on a key directions paper. Picture: Nadir Kinani

Industries that cannot make the switch to all-electric and government agencies like Melbourne

Water have been calling on the government to introduce a new certification scheme and better incentives to boost the renewable gas supply.

In its submission to Victoria’s Renewable Gas Consultation Paper, Melbourne Water called biogas, which can be turned into biomethane, a ‘quick win’ for the industry.

But noted that current restrictions and a lack of investment meant 30 per cent of the biogas they produce – enough to power thousands of homes per year – was being wasted.

Biogas is a renewable energy source generated by the breakdown of organic matter such as food scraps and animal waste.

In Victoria, unlike in NSW, producers are not able to pump biomethane into the gas network, forcing statutory authorities like Melbourne Water to flare it.

A biomethane plant in NSW takes methane gas produced by waste water and pumps it into the gas network. Picture: Max Mason-Hubers

A Melbourne Water spokesperson said its Eastern and Western Treatment Plants produced more than 1,800,000GJ of energy last year – enough to power up to 100,000 homes per year – most of which was used to generate renewable electricity and heat for wastewater treatment operations.

The submission notes that what is left over could be pumped into the natural gas network.

It comes after Australia’s consumer watchdog warned that a shortage of gas is expected in as little as three years.

Several other submissions also called on the government to unlock more biomethane supply.

Brick manufacturer, Brickworks, said the renewable fuel could assist the company switching from natural gas to renewable energy, and would keep prices low.

Leading global energy producer EDL called biomethane a “ready to go solution”.

A Bioenergy Australia report forecast the potential to inject 26 PJ of biomethane – enough to power almost half a million homes for a year – into the grid by 2030.

David Davis said Labor had “dropped the ball on biomethane”.

The Climate Council, however, warned that its role in replacing fossil gas would be limited.

Shadow Energy Minister David Davis said Labor had “dropped the ball on biomethane” despite Victorians’ “crying need for more gas to be injected into our gas grid”.

“AEMO has pointed to Victoria’s dire gas supply situation,” he said.

“This opportunity is significant with the capacity to perhaps power hundreds of thousands of households by the 2030s, materially contributing to our gas supply and security.”

But Energy Minister Lily D’Ambrosio said the government was “focused on scaling up biomethane and renewable hydrogen production” to reduce emissions for businesses that cannot electrify.

She said the renewable gases could “potentially” play a role in “storing energy to replace gas power electricity generation.”

The directions paper will be released later this year.

Originally published as Allan government accused of ‘dropping the ball’ on biomethane and renewable hydrogen