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Victoria's gas infrastructure what does the future hold?
VICTORIA'S GAS INFRASTRUCTURE:
WHAT DOES THE FUTURE HOLD?
by April Shepherd, Journalist, Energy magazine
As Victoria continues to pursue its goal of net zero emissions by 2050, Infrastructure Victoria has invited the community to respond to the latest interim report, outlining the possible future for Victoria's gas infrastructure, and how the state needs to change its relationship with natural gas.
Infrastructure Victoria has been asked to advise the Victorian Government on the state's gas transmission and distribution networks, offering a range of 2050 energy sector scenarios.
For a state that has relied heavily on gas for over half a century, transitioning to zero emissions is going to require a whole-of-economy response and dedication to the vision.
Infrastructure Victoria’s new interim report, Towards 2050: Gas infrastructure in a zero emissions economy, discusses the role of gas infrastructure in a zero emissions economy, presenting evidence and analysis that will underpin Infrastructure Victoria’s final advice.
Community feedback on the evidence and analysis presented in the report may influence Infrastructure Victoria’s final response to the government, which will be presented in a report released in
December 2021.
The advice will assess the relative economic, social, and environmental impacts of each scenario and identify infrastructure decisions that need to be made, ensuring opportunities for existing gas infrastructure use is optimised.
Evidence from the report so far shows that significant change is required to meet interim emissions reduction targets and reach net zero by 2050, developing four distinct illustrative scenarios.
Four gas scenarios
In developing the report’s evidence base, Infrastructure Victoria considered four illustrative scenarios to achieve net zero emissions for gas use in Victoria by 2050.
The scenarios test key variables regarding the potential technology mix (electrification, natural gas, hydrogen and biogas) and the mechanism by which net zero emissions can be achieved – whether emissions are eliminated or managed by solutions such as carbon offsets and carbon capture and storage (CCS).
The four scenarios are: » Scenario A: full electrification, no natural gas (by 2050), no CCS » Scenario B: partial electrification, limited natural gas use (in 2050), limited CCS » Scenario C: green and blue hydrogen with carbon offsets, electrification, no natural gas (by 2050), no CCS » Scenario D: large-scale brown hydrogen, large-scale CCS, no natural gas (by 2050)
Early findings from the interim report show: » A mix of approaches will be needed to transform how
Victorians use gas, to reduce emissions, manage risks, minimise costs and create new opportunities for jobs and industry. » The Victorian Government can support greater use of proven, low carbon solutions including energy efficiency, electrification and biogas to achieve emissions reduction. » There may be a role for gas-fired electricity generation to support our increasing use of renewable energy during the transition to net zero. » The Government can continue to support further development and demonstration of emerging technologies, including low emissions hydrogen, biomethane and carbon capture and storage until their viability at scale is known. » Reducing Victoria’s overall gas demand, especially in the household and commercial sectors where it is mostly used for heating, can reserve supplies for critical industrial purposes such as chemical manufacturing. » Future infrastructure and network investment decisions can be tested for compatibility with pathways to net zero.
For example, expanding existing gas networks to new residential and commercial developments may embed future emissions and could mean a larger potentially underused or stranded asset.
Gas to become history
Victoria's relationship with gas began in the late-1960s, with pipeline gas powering much of Victoria ever since.
A large gas network extends across the state, with storage facilities to help meet demand peaks and significant interconnections with other states.
The Victorian gas network includes 1,900km of gas transmission pipelines, 32,000km of gas distribution pipelines and assets valued at nearly $6 billion.
Victoria’s gas usage accounts for one fifth of the state’s emissions, so when the state committed to a whole-of-economy, net zero emissions target by 2050, under Victorian Climate Change Act 2017, gas was an obvious obstacle to conquer.
Infrastructure Victoria CEO, Michel Masson, said, “Natural gas has been good to Victoria for more than half a century, heating
our homes, cooking our food, and powering our industries and businesses all thanks to cheap, local supply.
“But the days of cheap gas are coming to an end.
“Natural gas is also a fossil fuel responsible for 20 per cent of the state’s greenhouse gas emissions, meaning our use of gas must change significantly if Victoria is to meet its emissions reductions targets and reduce the risks of climate change.”
What does the future hold?
Mr Masson said the road to net zero, regardless of how it happens, is a critical opportunity for the state that will affect most Victorian households, businesses and industries.
Towards 2050: Gas infrastructure in a zero emissions economy, states that, “The Victorian Climate Change Act 2017 establishes a system of coordinated, whole-of-economy actions to achieve a net zero emissions target by 2050, including rolling five-year plans and targets to reduce emissions".
Meeting the state’s emissions targets will be challenging. The Victorian Government has a crucial role to play in enabling the transformation by providing clear market signals, creating incentives to reduce, replace or decarbonise gas, and aligning its own policies and regulations with interim and 30-year emissions reduction targets.
The report supports these sentiments, with the journey to cutting emissions slowly slipping to a matter of urgency, as the report states, “Victoria’s energy system must transform to reduce greenhouse gas emissions and limit the impacts of climate change”.
