27 May 2020

Natural gas enabling renewables in electricity grid

The Australian Energy Statistics released today by the Australian Government confirm the critical role natural gas plays in the electricity market.

In 2019, natural gas accounted for 21 per cent of electricity generation in Australia. This is in line with all renewables (bioenergy, wind, hydro, solar and geothermal) combined. Electricity generation from natural gas increased by 6 per cent in 2019 as compared with 2018.

Natural gas is the most significant fuel for electricity in Western Australia, Northern Territory and South Australia accounting for 61 per cent, 58 per cent and 49 per cent of generation, respectively.

APPEA Chief Executive, Andrew McConville said the data showed the critical role natural gas plays in the electricity market by enabling more renewable power generation to be integrated into the grid and keeping it stable and reliable.

“These results underline the critical contribution of Australia’s oil and gas industry,” Mr McConville said.

“Natural gas allows for more renewables to be integrated into the grid due to its short response time. Gas-fired power generation can ramp up and down very quickly to support renewable generation and provide emissions reduction along with it.

“South Australia is a great example of an area where gas and renewables work side-by-side to deliver lower-emissions energy. The state gets about half of its power from gas and the rest from solar and wind.

“Experts in Australia and globally have repeatedly suggested the quickest way to reduce emissions from the electricity sector is to switch traditional generation with natural gas powered generation which has less than half the emissions associated with it.”

Mr McConville said amid the economic uncertainty arising from the current COVID-19 global pandemic, Australia’s oil and gas industry is helping ensure we keep the lights on at home, and our businesses, hospitals and other public facilities operating, by continuing to deliver energy to the domestic market.

“With exploration at record low levels, low oil prices and the COVID-19 pandemic meaning both gas demand and gas supply face challenges, the statistics reinforces how vital it is for all governments to support developing new gas supplies as quickly and as cheaply as possible.”

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