Is gas a “fraud” or the “future”? It depends on which Labor MP you ask, and whether they’re in opposition or government. Crikey has your guide to the Albanese-led Labor Party’s mixed feelings on gas.
Morrison’s gas-led pandemic recovery
When Scott Morrison was pushing for a “gas-fired recovery” from the economic crisis caused by the COVID-19 pandemic, Labor’s energy spokesperson Chris Bowen labelled it a “fraud”.
“It’s a slogan, it’s not a policy. It’s simply a fraud … there’s not been one job created, and there won’t be a job created of this alleged gas-fired recovery,” Bowen told an Australia Institute-hosted event in April 2021.
However, Bowen added that gas would remain a feature of the country’s energy system as it transitions to renewables. Increasing the storage of renewable energy would take time, Bowen said. In the meantime, gas would play a role.
When it comes to government subsidies for new gas infrastructure, Bowen said at the time he’d have to be “very convinced” there was a need: “Public subsidies are really where the market has failed. If the government really believed in investing in gas, they’d get out of the way, let the private sector get on with it.”
A few months earlier, then opposition leader Anthony Albanese had declared that a significant expansion of the gas industry was at odds with advice from the Australian Energy Market Operator.
“Under all the scenarios, what they say is by 2040, gas will be about 1% of the total electricity market. The total,” he told Guardian Australia. “All of their scenarios suggest it will be renewables with storage that will make the real difference. That’s where the expansion will be, that’s where the market will be, indeed there are other prospects for green hydrogen and other potentials.”
Behind the scenes, however, Labor was backing a gas expansion, as long as it was done in a “responsible” way. A draft of Labor’s policy platform being circulated in September 2020 said: “Labor supports the responsible development of Australia’s gas reserves, subject to environmental approvals to ensure communities’ concerns are addressed through rigorous science-based processes, including gas from coal seams, shale and tight gas formations.”
It added Labor, if successful in winning government, would ensure “gas development is environmentally sustainable, science-based and safe, managing environmental impacts and ensuring sustainable local economic activity”.
At the time, Albanese was grappling with the outspoken views of then resources spokesperson Joel Fitzgibbon, whose fossil fuel-friendly pronouncements were often at odds with his more climate-minded party colleagues.
Albanese’s future gas strategy
On Thursday, the Albanese government released its future gas strategy. It commits to a set of principles, including that new gas sources will be needed to meet demand during the clean-energy transition, that gas must stay affordable for households, and that Australia will remain a “reliable trading partner” for gas, which represents 14% of the nation’s export income.
“The strategy makes it clear that gas will remain an important source of energy through to 2050 and beyond, and its uses will change as we improve industrial energy efficiency, firm renewables, and reduce emissions,” Resources Minister Madeleine King said.
The strategy also emphasises the need to keep reducing emissions, reducing the impact of climate change, and the urgency to reach net zero emissions by 2050.
By the year 2028, the east coast is forecast to have a greater demand than supply of gas, and the west coast will experience the same two years later, according to the gas plan.
Therefore, gas infrastructure will need to be expanded: “Without further investment in new gas supply and gas infrastructure, these shortfalls will negatively affect Australian households and businesses, and the reliability of our electricity system,” the plan says.
What about job creation? The plan says the gas industry today directly supports 81,940 full-time equivalent jobs, and “many tens of thousands” of workers have been employed in the development and maintenance of the industry.
A program called Remote Jobs and Economic Development, managed by the National Indigenous Australians Agency, is funded to the tune of $707 million and aims to create 3,000 jobs over three years, helping to close the opportunity gap experienced by First Nations peoples.
Is Labor’s new gas strategy justified? Let us know your thoughts by writing to letters@crikey.com.au. Please include your full name to be considered for publication. We reserve the right to edit for length and clarity.
