Gas industry emissions will cost us much more than their so-called economic benefits

by Matthew Ryan


The emissions from the gas industry are delivering a devasting cost to our future

Yesterday, Resources Minister Madeleine King released the government’s Future Gas Strategy. On the same day, the Commonwealth regulator granted approval for Chevron’s massive expansion of their Gorgon project (you know, the one in the news all the time for its chronically underperforming carbon capture and storage project).

These announcements are a gut-punch to anyone who hopes to live on this planet in the future – especially our Pacific neighbours, whom the government are currently trying to placate, even while ensuring their homes sink beneath the waves.

At the same time, a survey of leading climate scientists showed their universal frustration with and condemnation of politicians and business who continue to approve and develop fossil fuels.

In the words of Camille Parmesan, from the CNRS ecology centre in France – one of the scientists surveyed – “What the fuck do we have to do to get through to people how bad this really is?”

And yet Minister King asserts that “gas plays a critical role in Australia’s economy” and that it is also “an important part of Australia’s future”.

The importance of gas in Australia’s economy is massively overstated. But any benefits must be held against corresponding costs – something the Future Gas Strategy fails to do.

Now, let’s be clear: the damages that will occur from runaway climate change cannot be truly calculated. What dollar value would you put on entire nations being wiped out by storm surges and sea level rise? (If you have an answer to that question, you’re either a psychopath, an economist, or a gas developer).

That said, economists have been working for years to develop their best estimates of the damages caused by each tonne of carbon emitted into the atmosphere. Those calculations vary, but let’s use the conservative estimates adopted by the US government.

In 2022-23, Australia exported 82 million tonnes of LNG. When burnt overseas, that will result in 239 million tonnes CO2e (roughly half Australia’s total domestic emissions). According to the US government, then, those gas exports will cause $74.9 billion in damages here and around the world. In the same year, the Australian government raised just $2.3 billion from the Petroleum Resource Rent Tax. That’s a pretty poor cost-benefit ratio.

We can use the same methodology to try and estimate the damages caused by the extension of Chevron’s Gorgon project – expected to result in 3 billion tonnes of emissions over its lifetime (more than Australia’s entire “fair share” of the remaining global carbon budget). Those emissions could cause $942 billion in damages, through floods, crop failure, sea level rise, heat stress, health care costs, bushfires, disease, and more. Hell, even domestic violence – already a crisis – is expected to get worse with increasing heatwaves.

And, again, this is a conservative estimate! Using another estimate published in the journal Nature, Gorgon Stage 2 alone could cause $1.9 trillion in damages before the end of the century.

That is equivalent to wiping out the entire value of the Australian economy.

Minister King says gas policy needs to be centred on “evidence-based principles”. To echo the words of IPCC lead author Dr Parmesan, what the “fuck” is the evidence King is using?

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