House debates

Tuesday, 21 March 2023

Grievance Debate

Gas Industry

6:30 pm

Photo of Kylea TinkKylea Tink (North Sydney, Independent) Share this | | Hansard source

Let's be clear: never has there been a government that has had such a clear mandate to take faster action on climate, and the truth is this government and this parliament can reshape our country's future. But to do so we must be prepared to lead ambitiously and bravely and break a cycle that has seen many climate and energy decisions over the past three decades made just on the basis of legislating for the term rather than fundamentally investing in and shifting our economy. Laid bare again this week off the back of the Australian Energy Market Operator, AEMO's latest report is the way forward, which is advocated for by the gas industry and many members and others in this place, and that is to open new gas fields. Contrast this with the way forward advocated for by my community of North Sydney and many more like it, who are determined to fight for and support a rapid and fair transition to renewables, and the tension between old fossil fuel industry technology, our government and the community becomes clear.

And so, to help strengthen my community's advocacy, I want to bust the often repeated myth perpetuated by the gas industry that Australia has a gas shortage. We do not have a shortage of gas in Australia. The reserves already being drawn from can provide our nation with more than enough to see us through a planned, proactive transition, and that is simply the truth. Yet the latest Gas statement of opportunities released by AEMO seems to suggest, just like the previous year's report, that Australia may be facing gas shortages, and their suggestion is that the best way forward, unsurprisingly, is to unlock more gas. At the same time, however, the AEMO report itself also says that by 2030 the amount of gas needed for electricity generation in Australia will have dropped by a third. Yet AEMO forecast that, in that same year, gas companies will still be exporting the same amount they are now.

Surely this shows that the argument trying to support the opening of new fields for domestic purposes is fundamentally flawed, if not just straight up fantasy. The problem is not lack of supply. The challenge is that, as it currently stands, Australia's gas is overwhelmingly exported, with more than 80 per cent going offshore. A little-known fact, but very concerning, is that the LNG exporters themselves, the industry itself, uses 12 times as much gas just to export as Australia's entire manufacturing industry currently uses. At a time when households and small businesses are under increasing cost pressure, we have gas companies driving up domestic gas prices and making windfall profits from exporting our resources overseas. Let's be clear once again: the myth of a gas shortage serves no-one other than the vested interests at gas companies, who wish to open new gas fields and expand existing licences.

One such push to expand gas fields is being made by the Australian company Santos out in north New South Wales in an area that stretches from the Pilliga Forest through to Newcastle and onto Queensland. A few weeks ago I was hosted by farmers and locals on the Liverpool Plains, which lie almost in the heart of this area. It's here that Santos wants to build the Queensland Hunter Gas Pipeline, an underground pipeline running for 833 kilometres from Newcastle in New South Wales to Roma in Queensland, with a side stop along the way to the Kurri Kurri gas power plant. Along the way, it traverses extensive areas of strategic agricultural land with high-fertility soils and prime food and fibre production land. The Liverpool Plains in fact yield 40 per cent above the national average, contributing over $300 million to our GDP annually.

The simple fact is that the science tells us that once this oil is dug up and then laid back down over the pipeline it will be significantly less productive. At the same time, the proposed pipeline significantly impacts high-quality koala habitat and dedicated areas of regional koala significance. It also crosses travelling stock routes, which have 10 species of threatened flora and 12 species of threatened fauna, including the eastern pygmy possum and the shy albatross. Recently the member for Mackellar and I sat and listened to the farmers, advocates and concerned citizens from the Pilliga and Liverpool Plains communities, who have been staring down consecutive fossil fuel projects for many years now, as they shared their knowledge and personal experiences. In the bigger context again, there is a truth here that we are not discussing. We know coal seam gas extraction is bad for rural farming communities. It impacts their water supplies, it impacts the quantity of the water, and it leads to soil subsidence. We know this because it is happening right now in the Darling Downs. The evidence is clear: coal seam gas is not the way forward for regional communities.

So there is no gas shortage on the east coast, and if there is no gas shortage on the east coast and you accept that argument, we don't need to open new gas fields. We do, however, need to rapidly accelerate our transition to renewable energy to ensure that any additional requirements for energy supply or surety are met. This should include prioritising development and investment in green hydrogen in our country. Today's IPCC report makes it clear that there must be no new fossil fuel extraction projects opened if the world is to meet the Paris target of limiting global warming to 1.5 degrees. Indeed, based on the findings of the International Energy Agency, the IPCC called for no new licensing or funding of oil or gas projects anywhere in the world. Make no mistake: projects like the Pilliga gas project and the Beetaloo Basin project are inconsistent with these calls and the Commonwealth government's commitment under the Paris agreement. UN Secretary-General Antonio Guterres, in a message of hope rather than despair, called for countries to adopt an acceleration agenda. He indicated that developed countries must bring forward their commitments to reaching net zero greenhouse gas emissions from 2050 to as close as possible to 2040.

So what is the solution that an ambitious and determined government could put in place to ease rising energy costs for communities? As my community continues to argue, it is to rapidly transition to renewable and to ensure that our market settings enable Australia to meet countries like the USA and the EU as investment magnates. The American Inflation Reduction Act has been a game changer for the nation, with businesses and talent flocking in due to the significant government support now in place across the economy to incentivise renewable energy adoption. And now the European Union, through their green deal, has joined the US as a magnate for that investment.

But where are we? In the short term, the projected annual shortfall in the domestic gas market can be avoided through the Australian Domestic Gas Security Mechanism, with Queensland LNG producers being able to meet domestic demand by producing gas above their export contract obligations. In the longer term, and in preparation for when this additional domestic capacity exhausts in around 2027, we must be more than ready with renewable energy. The revised safeguard mechanism is one policy lever we need to get right to drive down emissions and reduce large emitters' reliance on gas. But we also do need to incentivise homes and businesses to reduce their gas usage and make it easy and attractive for them to electrify everything by drawing on green energy sources. This could be achieved through a variety of measures modelled on the successful US Inflation Reduction Act, including providing grants for low-income households for energy-efficient upgrades and renewable installations or rolling out an electrification pilot in a community like North Sydney, where we are eager to test market design, grid integration and new business models, such as community ownership. Or it could be achieved by the Clean Energy Finance Corporation allocating funds towards electrifying both households and businesses in the form of zero-interest financial products.

Ultimately, be assured: Australia does not have a shortage of gas. We have a shortage of political leadership to drive the transition to renewables which is urgently required. As the UN Secretary-General Antonio Guterres said overnight, the 1.5-degree limit is still achievable, but it will take a quantum leap in climate action. Let's take that leap.