Bright future for gas, but the story must be told

The outlook for the gas and pipeline industries was looking up, APGA's Virtual Convention 2020 heard.

Speakers on the first day of the Convention covered a variety of hot topics in the industry and were generally positive about the furture with developments in future fuels and the economic forecasts gradually trending up.

But several speakers suggested that the industry was less adept at communicating the benefits of gas.

Economic activity in the gas pipeline construction sector would probably have a slow start next year, but the signs were that a number of new projects would get under way after that and likely continue until 2026, Quanta Services Australia Vice President Corporate Development and Strategy Donna McDowall said.

“The market is suddenly looking up for us,” Donna said.

“I think we’ll see here will be a sluggish start to the year but I see that it will ramp up and we’ll have lots of green-fields pipelines to build in the succeeding years, maybe to about 2026.”

Discussion of the nation’s future energy needs as either renewable or non-renewables had been detrimental to gas as its positive attributes were left out of consideration, Jemena Managing Director Frank Tudor said.

“The binary discussion about fossil and non-fossil has not been helpful to gas and I think seeing gas for what it is, for the attributes that it has is a really important message that we need to be able to convey to the general public,” he said.

“Lots of studies have been done to demonstrate that the cost of electrification, particularly in an industrial heating and in some of those more challenging environments is going to be really difficult to do with electrons, so having those [gas] molecules there for the overall support is really important.”

The significant additional cost of electrification had to be added to the cost of abandoning some of the gas infrastructure already in place when looking at the future energy mix.

Jemena is moving ahead with projects that demonstrate that gas has a role to play in a low-emissions future.

“We’re hoping to announce a biogas project very soon and we’ve got the Western Sydney Hydrogen Project. These are examples showcased locally to actually give effect to this role that gas can potentially have, that repurposed pipelines can have in a decarbonised future and I think that’s really important,” he said.

It was important to explore the real contribution gas can make in any shift to increased renewable electricity, APA Group CEO and Managing Director Rob Wheals said.

“If you take a cold day in Victoria in the middle of winter, that’s about a 1300 terajoule day in Victoria and that equates to like the equivalent of 15,000 megawatts per hour of electricity throughout that day,” he said.

“In the Victorian electricity system, currently peak demand is just shy of 10,000, so what that really says if you are going to electricity demand in that you have Victoria, you’ve got to have a 250 per cent increase in new electricity capability with dispatchable energy, with upgrades to power stations, with upgrades to transmission and distribution systems. I’m not saying for a moment that distributed energy resources won’t have a role in our future, I’m not saying that batteries won’t have a role to play in our future, but certainly, if you think about the role that gas can play as a delivery form of energy and as an efficient one and a low emissions one more so, but also how that infrastructure that’s transporting that gas whether it’s in main lines or distribution systems can be repurposed for the future, I think that’s a story that can be better told.”

Gas is a destination fuel, rather than a transition fuel, Epic Energy CEO Clive D’Cruz said.

During a panel discussion at the 2020 APGA Virtual Convention, Clive said gas had huge role to play globally and Australia was well-placed to support that.

“It’s a critical feedstock for our manufacturing, and so I think in Australia we need to think about that,” he said.

It was a low-emissions fuel, and due to its scalability, gas is much more versatile for the firming role than other options like batteries, he said.

“The role of the gas-fired power station is going to change as it is already doing,” he said. “But it has a very pivotal and important role because it can really provide the volume. Renewables has a bit to catch up on, but they are going to be complementary.”

Gas would help the economic recovery, GPA Engineering Mechanical Engineer Daniel Krosch said.

Representing the Young Pipeliners Forum at the APGA 2020 Virtual Convention industry panel discussion, Daniel said that it was a great time to be in the industry with the energy transition that was under way.

“The push to decarbonise [gas] will create challenges, but also opportunities for the gas industry to evolve into the future,” he said.

“Renewable gases, synthetic methane, hydrogen, may start to replace gas in distribution networks. There may be other opportunities. We don’t really know what the future is going to be.

“But a number of companies, Jemena, APA and AGIG, are already investing in the future.

“As an industry, we really have to open to change and evolution.”

Gas also offered opportunities to kick-start the economic recovery.

“As a young engineer, I think there’s plenty of opportunity ahead for all types of projects,” Daniel said.

“There’s a shortage of skills so it will be an opportunity for young engineers to step up and start leading some of these projects.”