Gas, renewables co-ordination needed: RISC Advisory

Gas, renewables co-ordination needed: RISC Advisory
PAUL GARVEY | The Australian | 12:00AM October 18, 2016

Australia’s east coast faces higher energy prices, less supply certainty and even higher emissions unless there is better policy co-ordination around renewable energy and gas-fired power, a leading consultancy has warned.

Perth-based independent firm RISC Advisory, which has previously advised the federal, West Australian and South Australian governments on the gas industry, said the combination of aggressive targets for renewable energy and active discouragement of gas development in the eastern states would leave the likes of NSW, Victoria and South Australia exposed to more energy problems.

RISC principal adviser Martin Wilkes said it was crucial that new gas-fired power capacity be developed in step with any expansion of renewable capability, given gas is the only widespread commercially viable option for reliable and fast response to the intermittency of renewables.

Instead, governments were pushing hard for renewables growth while also putting up barriers to gas exploration and development.

“My concern is there are two separate political debates and they really need to be pulled together. They’re not talked about in the same frame at the moment,” Mr Wilkes told The Australian.

Eastern Australia’s energy mix and its commitment to renewables in particular have been under scrutiny in recent weeks after severe storms triggered a days-long power outage in South Australia. The crisis has sparked calls for the reopening of a coal-fired power station at Port Augusta that closed in May after struggling to compete with government-backed renewable energy.

Mr Wilkes said government opposition to gas, which has seen various moratoria and bans put on onshore gas drilling in NSW, Victoria and the Northern Territory, was pushing gas prices higher and making gas less competitive.

“The danger is that this drives power generators back to the use of coal in order to maintain supply stability, and this will undermine the effectiveness and impact of the renewable targets,” Mr Wilkes said.

“Without a consistent approach to minimising emissions there is the real danger that the different actions taken will be counterproductive.”
He noted that an energy network made up of 30 per cent renewables and 70 per cent coal would actually generate more emissions than a renewables-free network of 70 per cent gas and 30 per cent coal.

The US, he said, had cut its emissions by about 12 per cent in the past decade primarily by replacing coal-fired power with gas, putting it on par with the renewables-led emissions improvements of Europe but without the increased prices and supply security issues seen there.

Gas-fired power plants are also easier to turn on or off at short notice compared to coal-fired power.
Mr Wilkes said he was aware of instances in Europe where renewable energy generation systems had been forced to temporarily shut due to the difficulties of ramping coal power stations up and down.

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