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Hartcher should stop providing PR for the gas industry
Beyond Zero Emissions statement, 20 December 2012
New South Wales Energy Minister Chris Hartcher recently said “If we are unable to access gas the lights will go out. It's as simple as that." (Daily Telegraph, 9 December 2012).
The statement is clearly wrong, on many counts (see below). Why is Hartcher making such nonsensical statements?
The only function of this scaremongering is to provide PR for the gas industry.
Coal seam gas companies operating in eastern Australia – Shell, British Gas, Conoco Phillips, Origin, Santos, AGL, and others - have a constant need to “book” gas and oil reserves in advance. This demonstrates to the share market that they have a future, despite dwindling global oil discoveries.
Now, however, they have over-committed gas exports to the Asian market and are frantically searching high and low to make up this shortfall – employing whatever methods they have – from fracking farms to pressuring ministers.
This rush has nothing to do with providing lighting, or anything other than higher prices to energy users in New South Wales. It does, however, require the one thing that coal seam gas seems to have lost: a social license to operate.
Hartcher is clearly wrong. Further, he should be supporting clean, renewable energy such as wind and solar, not more fossil fuels.
Coal Seam Gas operations in NSW's Pilliga forest
New South Wales doesn’t need more gas. As reported by the Australian Energy Market Operator (AEMO) just last week, demand for gas in New South Wales is falling – in each and every one of the market sectors, mass market, large industrial and the biggest drop of all – falling gas demand for power generation. Gas prices in Australia are rising as they are now being linked to expensive Asian gas prices thanks to gas export developments in Queensland. These price signals will drive home owners and industry to use less and less gas.
Demand for electricity in New South Wales is also rapidly falling – more than any other state. Energy efficiency measures and homeowners installing solar panels are having an impact. In recent months, electricity demand is down approximately 20% compared to what just a few years ago, economists predicted it would be.
Electricity generated from gas is also in decline in New South Wales. This has only ever been a small contributor to electricity supplies there. The lights are staying on in New South Wales, with less and less gas.
The largest energy investments in New South Wales are being made in renewables – and this will continue. Recent studies published by the Department of Climate Change show that New South Wales has the capability to generate an amount of electricity from renewables that is 200 to 300 times greater than current electricity demand, extrapolating from AEMO's 100% renewable energy scenario modeling. Companies such as AGL have recently cancelled plans to build any new gas-fired power generation plants in New South Wales – clearly not seeing any greater need to use gas to “keep the lights on”.
New South Wales’s electricity grid is connected to the other eastern states and the Snowy Mountains hydro scheme. Eastern Australian electricity supply - at the generation and transmission scale - is amongst the most reliable in the world. It is all managed by AEMO – who is tasked with ensuring that the lights don’t go out.