What is the case for more gas?

Government modelling of the Future Gas Strategy does not show a need for more gas
by Matt Saunders and Richard Denniss

The Future Gas Strategy, published in May 2024, sets out the Albanese Government’s plan for gas production and consumption in Australia between now and 2050.

Despite its stated objective to “support decarbonisation of the Australian economy” and the government’s previous stated policies of pursuing net zero emissions by 2050, the Strategy argues for the expansion of Australia’s existing gas production capacity.

The government presents two basic rationales for expanding gas production: that more gas-fired generation capacity is needed to facilitate the transition to a renewable grid, and that more gas production is required to address potential shortfalls (“supply gaps”) in domestic supply. Neither of these rationales are supported by evidence. Nor, indeed, are they supported by the government’s own modelling—or the Future Gas Strategy itself.

So why is the Strategy so insistent that Australia needs to produce more gas? There is a third, unspoken rationale at work here: the idea that it is in Australia’s economic interest to continue producing gas and selling it to the rest of the world. This reasoning underpins the Strategy’s repeated claims that gas will be needed to power the growth of Australian manufacturing, and that one of the Strategy’s six “guiding principles” is an assurance that “Australia is, and will remain, a reliable trading partner for energy, including Liquefied Natural Gas (LNG)”.

Given the ongoing damage that consumption of gas continues to wreak on the atmosphere, this is blind short-termism at best and deeply cynical at worst. For Australia’s LNG export facilities to continue working at full capacity, the rest of the world would have to resign itself to something in the region of 2.4°C to 2.6°C of warming. Such a scenario would not just be calamitous for millions of people around the world—not least in the Pacific region—it also stands in direct defiance of the scientific consensus on climate change, and the government’s own climate pledges and policies.

Similarly, the Future Gas Strategy’s preferred domestic demand scenario is that with the highest continued domestic gas usage. This level of domestic gas consumption would make it impossible to achieve net zero emissions by 2050—again, a direct contradiction to official government policy.

Despite the green-tinted language in which the Strategy sets out its vision of the future, that future is anything but green. It’s a future in which sea levels rise, extreme weather events increase in frequency, bushfires lay waste to the countryside—and gas companies make money hand over fist thanks to Australia’s refusal to confront the consequences of its greed and short-sightedness. This is not a future in which anyone wants to live, and it is not a future we should bequeath to the world.

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