06 Jun 2023

Opinion Article: APPEA Chief Executive Samantha McCulloch on the importance of gas to Australia and net zero (Herald Sun, Adelaide Advertiser, West Australian, Sunday Territorian)

What would Australia look like without natural gas?

Your first reaction may be concern that the great Aussie barbecue would disappear. But our gas bottles are just a small part of how gas is integral to our nation and way of life.

Without gas, we might not have bricks to build houses. Or bottles to hold our drinks. Or a stable electricity system to keep the lights on.

We also wouldn’t have seen over $400 billion of industry investment in little more than a decade, supporting 80,000 jobs and delivering billions of tax dollars for governments to build new hospitals, schools and roads.

A new industry public awareness campaign launching this week highlights the importance of gas to Australia, the nation’s energy system and the path to net zero.

Natural gas is widely recognised by independent energy authorities around the world as critical to emissions reductions as well as energy security. It is increasingly partnering with renewables and replacing coal in the power grid, producing about half the emissions of coal.

In some states like South Australia, where two-thirds of electricity is generated from renewables, gas still supplies the other 33% and as much as 90% in peak periods.

Without gas, the lights would go out because there would be no reliable back up for solar power on cloudy days and wind power on calm days. This stabilising role is particularly important during peak times when most people arrive home from work, cook dinner and have showers.

This is the role of gas in electricity in the cleaner energy future. And other states which still rely heavily on coal-powered generation will move in this direction as coal exits the system.

Internationally, Australia’s gas exports can help switch Asia off coal and other high-emitting fuels.

The gas industry is also key to deploying net zero technologies such as low-carbon hydrogen production and carbon capture and storage facilities, which trap carbon and bury emissions deep underground.

As a leading industry in Australia, natural gas also delivers massive economic benefits that helps governments fund policies and critical infrastructure for the benefit of all Australians.

Without gas, there wouldn’t be $16.2 billion of revenues flowing to federal, state and territory governments from the industry this financial year.

That’s the equivalent of around 11 new hospitals, or 160 new schools each year or annual health care for about 1.6 million Australians.

But our economic contribution is much wider than just taxes or direct jobs.

Research has found gas enables almost $500 billion of economic activity annually, powering millions of homes and businesses across the nation to support growth.

Not many industries have the ability to spend $45 billion this financial year on goods and services with Australian businesses as the gas sector can.

Consider also just a few of the industries that rely on natural gas.

Without gas, there would be no energy source or feedstock to make critical products like bricks, beer bottles, paper or fabrics.

Without gas, 40% of the energy needed for Australia’s manufacturing would disappear and the nation’s ambition to be a country that makes things would be under threat, not to mention thousands of jobs.

Without gas, there would be no energy for a lot of the mining operations across Australia that rely on gas and that deliver further billions to state and federal budgets.

What’s more, many of the minerals being processed with gas are the critical minerals the world needs to get to net zero. For example, gas can help make the batteries that power electric vehicles.

So again, without gas, there’s major disruption, a severely diminished economy and a further blow to net zero.

Too often the debate over Australia’s cleaner energy future is reduced to some sort of battle to the death – renewables versus fossil fuels, different colours of hydrogen, or different technologies to reduce emissions.

But the future will not be navigated successfully with binary choices.

The gas industry supports the growth of renewables because they help decarbonisation, including our own operations, and we share Australia’s commitment to net zero across the economy by 2050.

We understand the future will require different energy sources working together to get to net zero.

Natural gas will be part of that journey: making the bricks that build Australia, reducing emissions by replacing coal in electricity, and flexing the economic muscle that keeps Australia running.

And, yes, it’ll still cook the sausages on our barbecues.

Samantha McCulloch is the Chief Executive of the Australian Petroleum Production & Exploration Association (APPEA)