Monday, October 25

Why is Australia building a $ 600 million gas power plant as world experts warn against fossil fuels? | Energy

The Morrison government says it will spend up to $ 600 million on a new gas-fired power plant in New South Wales, the latest in a series of announcements dedicating taxpayer funds to increased use of fossil fuels.

Meanwhile, the International Energy Agency has released a landmark report that says there should be no new investment in coal, oil or gas if the world wants to keep open a slim chance of meeting the goals of the Paris climate agreement and reaching a net level. global zero greenhouse gas emissions. emissions by 2050. You have charted a path that could lead the world there.

What gives? This is what you need to know.

So what is the latest gas ad?

Emissions Reduction and Energy Minister Angus Taylor says unallocated funds in last week’s budget will go to publicly owned Snowy Hydro Ltd to build a 660MW gas plant at Kurri Kurri in Hunter Valley .

A environmental impact statement (EIS) filed with the NSW government shows that the Kurri Kurri plant would rarely be used, which in itself is not necessarily a big deal.

It would be a “peak” gas plant, designed only to turn on and fill in the gaps when needed. Snowy Hydro says it expects the plant to be only 2% of its full capacity for the entire year. It would be expected to initially run on diesel, an even more expensive and polluting fuel, before receiving its gas supply.

Taylor suggested Wednesday that it could also use some hydrogen mixed with the gas to reduce its emissions. The Snowy Hydro EIS said there was potential for this in the future if hydrogen were to become economically viable, but that it would require modification of the plant.

Kurri Kurri’s announcement followed EnergyAustralia saying it would build a 316MW gas plant, Tallawarra B, with $ 83 million in New South Wales and support from the federal government. That plant has been described as a gas-hydrogen hybrid – it has committed to blending 5% hydrogen into gas fuel starting in 2025.

Why is the government investing in gas power?

Taylor and Scott Morrison say another 1,000 new “distributable” electricity will be needed, which, unlike solar and wind power, can be used when needed, when the Liddell coal plant closes in 2023.

He says this must be because of gas flaring, which he says is essential for the future network. Morrison warned nine months ago that the government would build this amount of gas capacity if the private sector didn’t.

The government has wavered a bit on the actual figure (Morrison told ABC last year that the gap was about 250MW), but has returned to the 1,000MW target set in September last year.

Taylor says the two plants announced this month are part of the government’s much vaunted “gas recovery” from the recession.

Does this stand up to scrutiny?

Not according to many energy analysts, the climate science community, or the head of the government’s Energy Safety Board, Kerry Schott.

There is a long list of arguments against the government investing in new gas, from a variety of angles. They include:

  • Schott told Guardian Australia, and the government, that the Hunter Valley gas plant case is “not piling up” commercially as there are an abundance of cheaper and cleaner alternatives flooding the market.

  • The Australian Power Market Operator (Aemo) found that there is no need to replace Liddell’s existing coal plant in 2023 due to the gap to ensure network reliability. it was only 154MW, and that has already been covered by other commitments.

  • A task force that advised governments on the impact of the Liddell closure and backed this up by finding that NSW did not find an additional 1,000MW to keep the lights on and listed a range of committed and likely projects that it considered would be “more than enough ”.

  • Aemo found that while between 6 and 19 GW of new distributable energy would be needed over the next 20 years under an optimal future grid – that is, a grid that runs almost entirely on solar and wind power as the coal is expelled from the field. It could come from a variety of sources, including batteries, pumping hydropower, and demand management. He said new gas was an option but, in apparent contradiction to Morrison’s claims that gas generation would lower prices, it was likely to be more expensive than other options.

  • That by directly interfering in the electricity market, the federal government is likely to further discourage the private investment needed to deliver the huge amount of dispatchable generation needed in the coming years. This argument suggests that a global policy that establishes a trajectory of emissions, such as the price of carbon, would be a more economical and efficient approach that could guide private investment.

  • Last but not least, gas is a fossil fuel that releases about half of coal’s emissions when burned and contributes even more to global warming once the methane that escapes during extraction and pipelines is counted. . The argument is supporting the option of supporting the electricity grid that adds greenhouse gas emissions when cleaner and cheaper alternatives exist.

It sounds complete. How does the government respond?

He says the new capacity is necessary to keep prices low, and quotes former chief scientist Alan Finkel as saying that gas is the perfect complement to solar and wind power.

Finkel’s take on this is controversial and was criticized by 25 scientists in a letter last year, but he contends that gas has played a role in other places where they have turned away from coal in recent decades – England and California, for example. , and could allow a faster transition to a primarily renewable network. Opponents point out that there were fewer cheap alternatives to gas when those other places made the switch.

The government’s use of Finkel’s council is selective. He has also argued that the country should aim to use as little gas as possible given that it is a fossil fuel. Rather, Morrison and Taylor say they want to significantly expand the amount of gas available for use in Australia and say it is good for the climate.

Regarding emissions, Taylor and Morrison argue that Australia is doing much better than other countries because its emissions are already 19% lower than in 2005.

The parts they leave out:

  • Most of the reduction is due to a substantial drop in land clearing and native forestry in some states and has had little to do with restructuring an economy that is still largely based on fossil fuels.

  • About two-thirds of the 19% cut came when Labor was in power at the federal level, not the Coalition.

  • A small portion of 19% is due to coronavirus-related closures last year. Emissions from some sectors, such as transport, may increase this year.

  • Official government projections released in December forecast that there will only be a 6.8% drop over the decade through 2030, and emissions from transportation, mining and agriculture will stabilize or increase under existing policies.

  • The Morrison government has taken steps to slow the shift to a clean energy grid by allowing federal support for large-scale renewable energy to expire after the national renewable energy target was met two years ago.

  • Most comparable nations, including all G7 members, have shifted gears in recent months and increased their commitments for the next decade to make much deeper emissions cuts than Australia plans.

    Meeting some of the goals will be challenging, but more and more are introducing policies to meet them; See for example Joe Biden’s proposals in the US and what Boris Johnson is doing in the UK.

Is there a scenario where Australia builds more gas plants and reduces emissions?


Aemo found that gas power would decline with the cheapest approach to building a future grid. It already provides less than 7% of electricity and is expected to decline in the coming years.

But there is an argument that it would make sense to have more gas capacity available if several coal plants shut down earlier than scheduled due to an influx of solar power that makes them economically unviable.

In that scenario, which would be good for the climate, but could be problematic for a grid that is being transformed in the absence of an overarching national policy, gas plants would be used less frequently than cheaper batteries and water storage for pumping, but might fill some. Gaps in the system, particularly when support was needed for longer runs. Effectively, you would be taking an “all of the above” approach to ensure the system works.

The result may be that the number of gas plants connected to the grid increases, but overall less gas is burned.

But Aemo suggested that this would not be the cheapest way to tackle the problem. If governments build stronger electrical connections between states as planned, that could do the same job. It would significantly increase the ability to move supply across the East Coast and decrease the need for gas backup.

And it should be noted, of course, that this is not the government’s argument for building power from gas. Morrison and Taylor say they want to extract and burn more gasoline to fuel economic growth.

The budget included $ 59 million in federal funding for gas expansion and $ 30 million to support a company owned by billionaire Andrew “Twiggy” Forrest in plans for another proposed new gas and hydrogen plant in Port Kembla.

The federal government has criticized and vetoed attempts by state governments and federal agencies to accelerate the spread of renewable energy, has appointed fossil fuel advocates to advise on energy policy and, as we said before, failed to recognize the role gas plays in the climate crisis.

OK so. What did the International Energy Agency say?

The IEA is a traditionally quite conservative organization that shies away from fossil fuels. The oil and gas industry, in particular, has cited its previous reports to make its case that new gas projects can still be built as the world tackles climate change.

His report on Tuesday changed all that. It found that there was a “narrow and extremely challenging” path for the world to meet the Paris agreement targets and reach net zero greenhouse gas emissions by 2050, but it meant there should be no new investment in oil and gas fields. and coal-fired power plants, starting immediately.

It found that rich developed countries like Australia should go to net zero emissions first, by 2050. That means phasing out dirty coal plants by 2030, having zero-emission power grids, and banning new gasoline and diesel car sales for 2035.

Global investment must move much more quickly from fossil fuels to clean, zero-emissions solutions. Clean energy spending should more than double to $ 5 trillion (A $ 6.4 trillion) a year by 2030.

Crucially, the head of the IEA, Fatih Birol, said that the technology needed to go to net zero was already largely with us, but it needed support to develop much more quickly.

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