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Australian Gas Infrastructure Group (AGIG), AusNet Services, APA Group and Jemena has provided feedback to the Victorian Government’s Gas Substitution Roadmap Consultation Paper, commending the State Government for considering ways for the gas sector to reach net zero emissions.

The leading energy infrastructure companies are highlighting the importance of gas in achieving the most efficient transition to a low-carbon future – all submitting responses to the Victorian Government’s Gas Roadmap consultation process.

The AGIG, AusNet Services, APA Group and Jemena together deliver gas to over 4.15 million customers and transport half the country’s natural gas use across Australia.

The AGIG, which includes members Australian Gas Networks (AGN) and Multinet Gas (MGN), is a leader in the energy infrastructure and renewable hydrogen sectors and has a clear low carbon strategy to decarbonise gas supply in Victoria by 2040 as a stretch target, and by no later than 2050 in line with the Victorian Government’s targets.

AusNet Services Managing Director, Tony Narvaez, said, “AusNet is at the forefront of Victoria’s energy revolution as we transition our local distribution networks through rooftop solar and our state-wide transmission system to large-scale renewable generation. Transitioning to renewable gas is the next chapter in Victoria’s decarbonisation pathway.” 

Jemena’s Managing Director, Frank Tudor, said his company’s call for a Renewable Gas Target to be established, is a viable means of jump-starting the renewable gas sector. 

“The Renewable Energy Target (RET) proved crucial in driving down the cost of renewable electricity generation technologies such as solar and wind power. A Renewable Gas Target will perform the same role in the gas sector and would help to make hydrogen at $2 per/kg – as outlined in the National Hydrogen Strategy – a reality sooner,” Mr Tudor said.

Independent analysis shows energy consumers can save between $12-$14 billion per annum from 2050 in ongoing maintenance and capex costs if natural gas is retained in Victoria and Australia’s energy system, whilst the development of renewable gases such as hydrogen and biomethane offers a pathway to fully decarbonise the Victorian energy grid. 

Developing a framework that provides similar support for the renewable gas sector as that provided to the renewable electricity sector is key to efficiently and effectively decarbonising energy supply, retaining customer choice and improving energy security and reliability for Victorians.

APA’s CEO and Managing Director, Rob Wheals said, “As coal is retired, natural gas will continue to play a critical role in ensuring electricity grid stability and helping Victorians keep the heater running and the lights on in winter.

“However, as technology develops, Victoria’s existing gas infrastructure will be vital to connecting Victorians to the energy solutions of tomorrow, like hydrogen and biogas – and APA’s pipelines are adjacent to some of the best geographical areas for hydrogen production in Australia. 

“With billions of dollars invested in gas infrastructure across the country it makes sense to look at ways to efficiently use our existing energy infrastructure to support Victoria’s transition to a low-carbon future.” 

AGIG CEO, Ben Wilson affirms Mr Wheals sentiment, “Using our existing gas networks to deliver renewable gas, including renewable hydrogen and biomethane, provides a low cost, reliable and practical way of decarbonising natural gas use in Victoria.

“Victorians love natural gas today. Importantly, renewable gas will allow our customers to continue to enjoy the benefits of gas into the future while meeting their sustainability goals.

“Blending renewable hydrogen into gas networks is a crucial early step to ramp up supply growth, thereby bringing costs down. This is exactly the same pathway taken for the renewable electricity sector.”

Mr Wilson said that by getting the foundations right, Victoria can build a thriving hydrogen industry that provides carbon-free gas to residential through to large industrial customers in the state, along with other markets such as transport.

Building the scale and capability by blending renewable hydrogen into gas networks to supply homes and businesses could position Victoria to benefit from a substantial new export opportunity.

This could mean a future where Australia could be exporting from rooftop solar systems to the world through hydrogen power, leading to fresh employment opportunities as well.

AGIG is currently delivering a five per cent renewable hydrogen blend to some of its South Australian customers, with plans for Victoria. 

Recently, ARENA provided its support for AGN to deliver Hydrogen Park Murray Valley located in Wodonga, which will provide a ten per cent renewable hydrogen blend to over 40,000 homes and businesses in the region. 

Hydrogen Park Murray Valley is consistent with AGIG’s plans to deliver a ten per cent renewable hydrogen blend across all of Victoria by no later than 2030, reaching 100 per cent  hydrogen by 2040.

“AGN believes introducing a firm Renewable Gas Target, similar to what is in place for renewable electricity, is required to start us on this carbon-free pathway for the gas supply sector and access substantial new jobs for Victoria,” Mr Wilson said. 

Victoria has demonstrated success in deploying and scaling up these types of policies before in encouraging wind and solar electricity. 

AGIG encourages leveraging these learnings in building a Victorian hydrogen economy – creating new jobs, reskilling existing workforce and supporting gas appliance manufacturing in Victoria.

The AGIG said that gas continues to be a good low carbon option for customers currently, because gas is used mainly in the mornings and evenings when rooftop solar is not generating, and so the alternative for the vast majority of customers is coal-intensive mains electricity. 

Gas connections also provide customers with the option for a future hydrogen connection.

Collectively AusNet Services, AGIG, APA, and Jemena are already investing over $130 million in projects designed for the application of renewable gases such as hydrogen and biomethane in residential, industry, and transport settings.

Renewable gas will also ensure the ongoing viability of those industries which cannot be easily electrified – such as manufacturing and steel-making – which currently rely on gas as a crucial feed-stock for their operations. 

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