Closing Victoria’s coal-fired power stations by 2035 will not reduce greenhouse gases enough to meet the state’s ambitious new emissions targets, with environmentalists urging the Andrews government to reduce gas use.
If Victorians maintain their current reliance on burning gas in homes and small businesses – mainly for heating and hot water – the fossil fuel could be responsible for one-third of the state’s climate pollution by 2035, according to a new report released on Monday by Environment Victoria.
And if manufacturing and industry are included, gas consumption could account for about half of the state’s emissions by 2035.
“Victoria has world-leading climate targets and a comprehensive plan to shift the electricity sector away from coal to renewables, but more than 2 million homes are still hooked up to fossil gas,” said Environment Victoria chief executive Jono La Nauze.
“Victorian households are already struggling with high gas prices, and this adds urgency to the need to get off gas as quickly as possible.”
During last year’s election campaign, the Andrews government announced a more ambitious emission reduction target of between 75 and 80 per cent by 2035, saying the state would completely end coal-burning power generation by 2035.
It also promised 95 per cent of Victoria’s electricity would be produced by renewables in fewer than 15 years.
Victoria uses more gas than any other state, accounting for almost 40 per cent of domestic gas consumption in Australia’s east coast gas market. The largest volume of this gas – more than 120 petajoules – is used in residential and commercial buildings, the report says.
Space heating accounts for almost two-thirds of Victoria’s household gas use, water heating accounts for around one-third and cooking makes up just 4 per cent of total household use, according to research by Infrastructure Victoria.
Last year, the state government released a Gas Substitution Roadmap, which included plans to abolish regulations that mandate gas connections in new homes and retire incentives for the adoption of gas appliances.
The proposed $250 million Crib Point floating gas terminal that was rejected on environmental grounds.
But La Nauze said the plan fell short of establishing incentives needed to drive enough households to replace their gas appliances with efficient electric appliances.
“Right now, households are being slugged with massive disconnection fees for getting off gas and that must stop,” he said.
There are new gas projects proposed for Victoria. Viva Energy, owner of the Geelong oil refinery and Australia’s Shell and Liberty petrol stations, is awaiting environmental approval for its plan to extend a pier at the refinery site and park a floating vessel that holds super-chilled liquefied natural gas and turn it back into vapour for Victorian homes and businesses.
The project faces resistance from environmentalists and some community members, who argue it is too close to residential areas and schools and fear it will damage Australia’s climate ambitions by extending the use of fossil fuels.
A similar AGL floating terminal project at Crib Point was rejected by the government because it would have unacceptable environmental effects.
The Australian Energy Market Operator has warned of changes to its expectations of available power supplies over coming years in Victoria, South Australia, NSW and Queensland, reinforcing the urgent need for new electricity generation plants – whether gas or renewable – and other key infrastructure to be approved and built.
Samantha McCulloch, chief executive of gas peak industry body APPEA (the Australian Petroleum Production & Exploration Association), said Victoria needs more gas, not less.
“Victoria, in particular, urgently needs to bring on new gas supply to meet demand and to ensure its energy security because it is facing serious shortfalls and energy consequences as soon as 2023 for 2 million households and 70,000 businesses who already pay $2 per gigajoule extra when gas has to be transported from Queensland,” McCulloch said.
The Victorian government did not respond to a request for comment before deadline.
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