29 February 2024
You can’t switch off our gas
By Craig de Laine
Gas and electricity networks have complimented each other in Victoria for decades. We saw this relationship in action on February 13, when the electricity network was damaged and a major coal generator went offline following heavy storm activity. Fast starting gas generators drew immediate supply from the market and stepped up to provide more than 20 per cent of the state’s power during the evening peak demand.
The reliability that gas provided to the State’s energy system cannot be understated. In areas where the electricity grid was unable to supply power, gas customers were still able to cook a hot meal on their gas cooktop. In fact, fewer than five of our 1.5 million gas customers were without supply during the recent storms.
The response to this month’s unfortunate events highlights the benefits of having a dual fuel energy system, particularly if extreme weather events become more frequent as many predict. It makes the case for both gas and electricity networks to operate in Victoria into the future, contrary to the ban on new gas connections implemented by the State Government on 1 January.
Our dual fuel system is one of the reasons Victoria has the largest manufacturing sector in the country. Gas is a secure and reliable energy source for businesses in the state. If we are not careful, that may all change. Recent commentary from the Australian Industry Group1 that more businesses may leave the state due to uncertainty around energy supply should be driving us to put energy security and reliability, along with emissions reductions, at the centre of decision-making.
The Australian Energy Market Operator has also highlighted reliability as a key challenge in Victoria, predicting more frequent and severe electricity blackouts this decade unless prompt action is taken.2 Commonsense can only conclude that it is impossible to expect the electricity network to meet all of the state’s energy needs. And it doesn’t need to.
Moreover, Victorians should have the right to choose the energy source that best suits their needs and not have this decision taken out of their hands by the Government, particularly if that works against energy security and reliability.
We have been upgrading the gas networks in Victoria over the last twenty years. As a result, the underground supply of natural gas to homes and businesses is extremely reliable, with outages only occurring, on average, once every 60 years for our customers.3 Importantly, these upgrades mean our gas infrastructure is world-class and capable of delivering renewable gas to Victorians in the future at little additional cost.
There is a logical role for gas networks to continue to complement electricity networks while working towards decarbonisation with renewable gas into the future. It is key to maintaining the security and reliability of our system. With that in mind, AGIG is investing in renewable gas projects now as we pursue our low carbon vision, targeting net zero by no later than 2050.
In the past 12 months alone, AGIG has launched or expanded renewable gas projects in Queensland, South Australia and right here in Victoria. Our flagship renewable gas project in Wodonga will provide a blend of renewable gas to over 40,000 homes and businesses from 2025. Our HyHome project in Wollert is powered by 100% hydrogen appliances, including the BBQ in the backyard, and demonstrates what is possible in the future.
Our message is clear. Victoria’s economic prosperity is closely linked with maintaining our dual fuel energy system, and it is imperative that policy makers take this into consideration as we look to the future. The Government needs to provide more energy options, not fewer, so Victorian industry, businesses and homes can continue to choose the energy they need into the future.
[1] Victorian business exodus threat on energy | The Australian
[2]2023 Electricity Statement of Opportunities (aemo.com.au) – p3, p58
[3]AER - 2022 Gas Network Performance Report - December 2022_2.pdf
Craig de Laine is the CEO of the Australian Gas Infrastructure Group, which incorporates Australian Gas Networks and Multinet Gas Networks in Victoria and a range of other gas infrastructure assets across Australia.
For Further Information Contact
Mitchell Cutting, Senior Advisor External Communications
M +61 460 018 065
