The Federal Government has a vision for a gas-fired recovery in response to the COVID-19 economic downturn and plans to invest billions of dollars of public money into this failing industry. ALEC’s joint submission with the Environment Centre NT strongly opposes the Gas Fired Recovery Plan.
Not only will the Morrison Government’s plan have a devastating impact on water, climate and Country, gas is a job poor industry and investing in gas production won’t help Australia recover. Focusing on gas is a missed opportunity to modernise Australia’s energy system, lower electricity prices and create the jobs of the future as we move toward a low-carbon economy.
In September 2020, PM Scott Morrison unveiled plans for taxpayer-backed, gas-fired recovery strategy which includes setting up a National Gas Infrastructure Plan to identify the priorities for investment in the gas transport network and establishing an "Australian Gas Hub" at Wallumbilla in central Queensland for domestic trade.
Alongside world-leading Australian experts and lead authors with the Intergovernmental Panel on Climate Change, ALEC strongly opposes the gas plan which will cause substantial harm to our climate, land and water. In particular, ALEC opposes the development of the Beetaloo Sub-Basin, associated pipelines across the Northern Territory and the development of a petrochemical plant at the Middle Arm Industrial Precinct close to Darwin.
A gas-fired recovery is a backward step which prioritises the short-term profits of fossil fuel companies ahead of the sustainable industries of the future to the detriment of people, culture and the environment.
ALEC sees six major issues with the premise of a gas-fired recovery:
- The energy sector is transitioning towards renewables, not gas. The Australian Energy Market Operator’s 20-year plan for Australia’s energy resources is clear that a diverse array of renewable technologies with storage capacity is key to fostering a resilient and reliable energy system. There is no clear role for new gas.
- Gas won’t lower electricity prices - Even historically low global gas prices and the coronavirus pandemic reducing LNG demand have not brought gas prices under $6 across Australia. Easily accessed gas resources were funnelled off for export, leaving more expensive gas resources for the domestic market. Industry experts suggest that the aspirational gas price of $4-6 is nowhere near realistic.
- The gas industry won’t bring a jobs boom. In fact, the oil and gas industry is the least labour intensive industries in Australia. The gas industry currently employs less that 0.2% of the Australian workforce despite Australia’s position as the world’s largest gas exporter. Renewable energy technologies are job rich, while jobs in gas are heavily automated.
- The gas industry won’t stimulate the economy as much as the Government claims. Many oil and gas companies pay a negligible amount of tax and limited royalties, with most profit exiting Australia. The oil and gas industry generates around $1 billion a year in revenue. To put this in perspective, the Federal Government’s revenue in 2019-20 was $514 billion, meaning oil and gas contributions amounted to 0.2% of Government revenue.
- Gas is a fossil fuel which will have devastating impacts for the climate and the Northern Territory. Gas is primarily made up of methane, a highly potent greenhouse gas that has 84 times greater warming potential than carbon dioxide over a 20-year period. The Territory is already a place of climate extremes, with the impacts of climate change bringing more intense, variable and frequent heat waves, droughts, floods and wildfires.
- A gas-fired recovery is a disaster for the Northern Territory. We need quality, long-term, low-carbon jobs in the NT. The Territory has the potential to be a renewable energy superpower, and lead the way with an economic recovery that prioritises people, culture and the environment.
A gas-fired recovery is a missed opportunity in creating more resilient energy infrastructure, lowering electricity prices, creating the jobs of the future in climate mitigation and climate adaptation and decarbonising the economy.
Image: School Strike 4 Climate Action / Twitter