The role of natural gas in the transition to net zero

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  Australian Energy Producers.
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As Australia races towards its goal of net-zero greenhouse gas emissions by 2050, energy industry leaders say natural gas is a critical player in keeping the country running.

Samantha McCulloch, chief executive of Australian Energy Producers, says natural gas will offer an important “safety net” for Australia’s energy transition.

“As we increase our reliance on renewable sources like wind and solar, natural gas can provide necessary backup power, especially when weather conditions are not ideal and energy demand is high,” she says. “Affordable and reliable energy is so important, and gas will be a safety net to help keep the lights on for millions of homes and businesses. As coal is phased out of the electricity grid, natural gas is a partner for renewables.”

The International Energy Agency (IEA) reports natural gas produces about half the emissions of coal on average when used for power generation.

The agency has revealed switching from coal to gas cut more than 500 million tonnes of CO2 globally between 2010 and 2018 alone.

This ‘gas + renewables’ model is already in practice in South Australia, offering a blueprint for other states as they transition away from coal in the coming years.

“Over the past 12 months, gas generated 29 per cent of South Australia’s electricity as a partner to renewables. But in one 24-hour period during April, gas generated 56 per cent of electricity when conditions for renewable generation weren’t favourable,” Ms McCulloch says.

In Victoria, the recent blackouts in February highlighted natural gas and hydropower’s capability to quickly ramp up to ensure power for thousands of households.

Outside the household electricity supply, natural gas plays a crucial role in various manufacturing industries, including the production of bricks, glass bottles, plastics, and chemicals. These processes often require high temperatures and specific materials.

Gas also helps power Australia’s mining industry and can help process many of the critical minerals required to get to net zero.

Ms McCulloch says the gas industry will have a much broader role in net zero as a major investor in low-carbon hydrogen development and the emission reduction technologies needed by many industries.

“Gas companies are innovating to lower emissions, including by using renewables in their operations, deploying carbon capture, utilisation and storage, and applying new technology in areas such as methane monitoring, reduction and reporting,” she says.

“Companies are also using artificial intelligence to improve operational efficiencies. Others are deploying robots and drones to enhance safety and lower emissions.”

Carbon capture, utilisation, and storage (CCUS) technologies are emerging as an integral part of the gas industry’s contribution to reaching net zero.

Acting like a vacuum in the reverse of the gas production process, CCUS projects capture industrial emissions and store them in deep geological formations, often reusing old gas wells. The IEA states getting to net zero without CCUS would be ‘virtually impossible’.

“You could say carbon capture is almost in the DNA of this country, and much of what has made us a gas production powerhouse can also help make us a decarbonisation powerhouse,” Ms McCulloch says.

“Six carbon capture projects are at an advanced stage in Australia, and we have the biggest facility in the world for this technology, which is at Barrow Island, off Western Australia, already trapping millions of tonnes of carbon dioxide emissions.”

Ms McCulloch says Australia has an opportunity to be at the forefront of the CCUS sector, becoming a carbon storage leader in the Asia-Pacific and supporting the net zero goals of countries like Korea and Japan, which have limited options to store carbon domestically.

This presents a major new industry for Australia in the same way we have built a world-leading LNG export industry delivering jobs and billions of dollars of benefits to Australians.

“Australia needs to see the net zero challenge as an opportunity,” Ms McCulloch says.

According to government estimates, Australia’s LNG exports have the potential to reduce emissions in the region by as much as 166 million tonnes of carbon dioxide, providing an alternative to higher-emitting fuels. That is around one-third of Australia’s annual emissions.

Ms McCulloch says the pace and scale of the transition required is ‘enormous’, and the road to net zero will not always be smooth sailing.

“But if we confront this challenge and opportunity based on facts and science, Australians will be in the best position to benefit from the net zero energy transformation,” she says. “We need a portfolio of energy sources and technologies on the table working together.”

“Australians should be excited by the energy transformation and turning this challenge into an opportunity where we can lower emissions while strengthening our economy.”

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