Renewable gas is the answer to power Australia's energy future
10 April 2023
THE BID to electrify everything is running out of juice. It's 2022-thinking that demonstrates two-pronged ignorance: assuming all gases are the same and that science and technology ground to a halt 12 months ago.
While most people know LPG fires-up their BBQs, many are surprised to learn that 2,000,000 Australian households (22% of all homes) rely on it for in-home cooking, hot water and/or heating.
So Australia's LPG sector achieving not only net zero, but actual zero, emissions and replacing all conventional LPG use with a renewable alternative by 2045, should come as welcomed relief to governments, businesses and families.
With the independent Australian Energy Market Operator belling the cat on looming power shortfalls and potential major blackouts, rLPG will be an important complement to delivering reliable, affordable energy, while relieving pressure on an overburdened electricity grid.
It also saves the massive costs of switching to expensive, less reliable and higher emitting electricity.
Residential case studies for NSW and Victorian gas homes, over 830,000 dwellings in all, show the claims about electric appliances being better on costs and emissions are overcooked. In fact, dead wrong.
Looking at appliance costs and energy bills, continuing with LPG remains lower cost for homeowners to the 2040s, when LPG and electrical appliance-use cost the same.
Switching to the most efficient electrical appliances, households would incur $11,871 in upfront costs (appliance and installation), save a few hundred dollars over a year on bills, but would only reduce emissions by between 5.4kg (NSW) and 9kg (Victoria) per week. That's the volume of typical BBQ cylinder.
In NSW it would take 14 years for homeowners to get a return on that investment. In Victoria it's 12 years. The cost of carbon abatement is $282.65 in Victoria and $707.81 in NSW per tonne. Respectively, that's eight-to-20 times higher than the going rate for Australian carbon credits.
Faced with these costs, families might opt for cheaper, though less efficient, electrical appliances thinking they're still doing the right thing. But they'd be wrong.
Emissions from cheaper electrical appliances are actually higher than sticking with existing gas appliances. In NSW the emissions increase in switching to lower efficiency electrical appliances is 640kg per dwelling a year, while in Victoria it's a whopping 960kg a year.
This dispels the myth that electricity is, by default, cheaper and lower emitting than gas. But it gets worse.
These costs are only for appliance replacement. What is often hidden from consumers are the additional costs as all-electric homes typically require upgrading from Phase 1 to Phase 3 wiring throughout. Depending on the size of the premises, these costs can run to over $40,000 per dwelling.
Meanwhile, Australia's transition to rLPG starts in 2025, when three domestic Sustainable Aviation Fuel (SAF) plants come online. Ten percent of their production creates rLPG as a by-product. Their initial production runs will replace 11% (135 million litres) of current LPG demand with rLPG, virtually overnight.
That's 56,430,000 kg of immediate carbon abatement.
Another benefit of rLPG is it's a simple 'drop-in' replacement. That means no extra costs to homeowners, businesses or community groups using it. Existing cylinders, pipes and appliances require no changes.
It's a game-changer that negates the exorbitant costs of switching. rLPG will be net zero over the same timeframe as electricity, but go further to deliver actual zero emissions as sectors we rely on, like trucking, get their emissions under control.
The closed-loop processes involved in taking CO2 from the atmosphere, initially through SAF and then via synthetic gas replacements to make rLPG, means there is no need to find or buy carbon offsets.
It's already happening across Europe where rLPG derived from Hydrotreated Vegetable Oils, the same method to be used for SAF in Australia, has been available industrially since 2019 and commercially sold in cylinders for families and businesses for cooking, hot water and space heating since mid-2020.
Australia's LPG sector will do all of this without the huge costs to families and businesses of changing to electrical appliances or retrofitting their homes and premises to cope with the new loads.
It's also a saving to taxpayers. We have made it clear to governments that we are not seeking any funding to aid LPG's transition... no handouts, subsidies, project funding or the like. The industry will simply get on with the new technologies.
All we need is a level playing field. Recognising and including rLPG in the array of government considerations, programs and mechanisms on equal footing with other gases, like hydrogen and biomethane, will enable Australian homeowners and businesses to choose the path to zero that best suits them.
With Australian-made fossil-free rLPG available in less than two years, aiding government 2030 and 2050 emissions targets, it leaves any sensible person scratching their head as to why taxpayers, businesses or homeowners would foot the massive bill to switch.
When politicians and others insist that they are led by the science, it is incumbent on them to keep pace with developments. Australia cannot afford to be mired by outdated assumptions.
Policies to lure millions of Australians away from gas, based on blinkered ideology or ignoring technologies that show not all gases are the same, inflict massive unnecessary costs and uncertainty on homeowners and businesses, while compromising electricity supply. All for no climate benefit.
Published in the Daily Telegraph newspaper on 10 April 2023, and the NT News on 11 April 2023.
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