The future of power: What’s behind Australia’s push for gas-fired energy | Four Corners
SCOTT MORRISON: You want to change manufacturing in this country? You've got to do it with gas. You've got to do it with gas. MICHAEL BRISSENDEN: As our economy emerges from a once-in-a-century global pandemic and our energy system is up-ended by an historic transformation, we're told the future depends on gas. There is no credible energy transition plan for an economy like Australia, in particular, that does not involve the greater use of gas.
MAN: It's your life - it's your carpet, it's your building materials, it's your car, it's your plastics that you buy in your grocery store, it's your medicine bottles. Please remember gas isn't just about burning it and making electrons. The Government says gas will fuel a post-COVID manufacturing renaissance, stabilise our energy system and deliver reliable power for years to come. MAN: We want to see more affordable, reliable energy in Australia.
We want to see a successful manufacturing sector. Gas is a critical feedstock for our electricity system because it's flexible and dispatchable. Both sides of the political divide see gas as a path through a difficult transition away from coal. We don't say that there shouldn't be any new gas, that's not our position.
The truth is that gas plays a role at the moment. But support for an increasing role for gas is far from unanimous. MAN: The best way to recover economically is stimulate industries that have a good future.
And gas isn't one of those. WOMAN: How can the government put at risk our most great resource, our groundwater, for a short-term gas-fired little pump in the pocket? I know I'm old, but I'm just going to keep fighting because I've got 13 grandchildren. MAN: Let's get the facts on the table - using gas to create electricity is a really expensive way to do it. So if you're interested in driving down electricity prices, then you'd be mad to use gas. Despite major objections, the Federal Government is pushing ahead with its vision for a gas-led recovery, potentially underwritten by hundreds of millions of dollars of taxpayers' money. Tonight on Four Corners, we ask why the government is so determined to ignore the dissenting voices and commit Australia to a gas-fired future.
(APPLAUSE) Thank you for all attending here today. This year our government, we will continue to build an even stronger Australia. In January last year, the Prime Minister detailed his grand plan for the national economy and declared it would be fuelled by gas. Central to this agenda is getting access to our domestic gas supplies.
We need to get the gas from under our feet. We've got to get the gas. (APPLAUSE) Then, as the coronavirus took hold, Scott Morrison announced the formation of a COVID commission to solve the multiple problems the country would face. Morning, everyone.
Today I'm announcing the establishment of a National COVID-19 Coordination Commission. That commission's job, put simply, is to solve problems. Problems that require the private sector working together with the private sector. It's about the private sector working together with the public sector.
The man by the Prime Minister's side was hand-picked to head the COVID Commission. Nev has agreed to do... Nev Power, former Fortescue Metals executive and deputy chair of oil and gas company Strike Energy. And it's great that Neville, when I rang him the other day, I simply said, "Nev, I need you to serve your country." We know that this virus will come and go and we want to be well positioned to make sure that we restore people's jobs and livelihood as quickly as we possibly can afterwards. Thank you very much for your time.
A week after the formation of the commission, a task force was created with the express purpose of looking at the manufacturing sector's recovery from COVID. The head of this task force, and special adviser to the COVID commission, was Andrew Liveris, former CEO one of the world's largest gas users, Dow Chemicals, a current director of one of the world's largest oil and gas companies Saudi Aramco, and a director at Worley - a major engineering consultancy for the gas industry. I got the call from the Prime Minister to assist the Commission on phase two of the COVID Commission's work, which was... You know, phase one was the stabilisation of the pandemic's issues which, as you know, a year ago were very acute, but phase two was economic recovery. And what could that look like? And what could we do with the Australian economy post-pandemic that we were maybe not doing before the pandemic? Darwin-born Andrew Liveris's industry expertise has been widely sought.
In the past, he's advised Barack Obama as co-chair of his Advanced Manufacturing Partnership... Andrew, please come up to the stage. ..and Donald Trump, who announced Liveris would head his American Manufacturing Council at a 2016 rally in Michigan. President-elect Trump, I can't tell you, I tingle with pride listening to you. But to honour me to help you chair America Manufacturing Council, to put in place...to put in place the investments that you talk about,
you're paving the way with your administration, with your policies, to make it easier to do business in this country. I like to look at things from multiple angles. So great. Thank you, Andrew.
And the fact that I have a piece of me in the fossil fuels industry actually gives me an angle. And by the way, it's the old adage, to change something, you better be at the table, otherwise you're on the menu. This won't come as any surprise to you, either - people point to your role with Saudi Aramco, they point to you being on the board of Worley, the company does engineering consultancy for oil and gas companies. So, the conclusion to that is that any increased gas activity is financially good for you.
Yeah, so both are director roles. So check the director pay. It isn't...there's no stock involved, apart from the stock I bought in Worley to show good faith. Worley's reconstituted itself and reengineering itself under its new leadership to be a sustainability company.
I'm very proud of my role in that, which is entering the energy transition as a solution provider to the topics we've been talking about today. Joining Andrew Liveris on the manufacturing task force were seven men, all manufacturing experts and all with diverse energy interests. A majority also have significant stakes in the gas sector, either through their business or member base. When contacted by Four Corners, task force members emphasised the importance of gas in manufacturing and pointed to a requirement that where any conflicts of interest occurred they removed themselves from those parts of the discussion. Why did the COVID Commission, then, come out so strongly backing gas? That's a really simple answer, Michael. If I gave the COVID Commission, if I made it up of seven carpenters, I'm sure they would have said, "House-led recovery looks pretty good.
"Why don't we build a whole lot of houses "and employ a whole lot of tradies?" If you give the COVID Commission to a whole lot of gas executives, that's the answer you're gonna get. Last May, the manufacturing task force submitted its final report to the COVID commission. The report has never been made public, but Four Corners has seen it. It recommends the acceleration of new gas field developments and the use of taxpayer funds to underwrite new gas infrastructure, including pipelines.
G'day, Leigh. How are you, mate? Four months later, Scott Morrison visited a NSW aluminium smelter, one of the most gas-intensive industries. He declared the pursuit of a gas-fired recovery, embracing many of the taskforce's recommendations, and a promise to deliver cheaper gas. When Andrew Liveris sat down with me at Kirribilli some time go, and working with him through the COVID Commission, he said "You want to change manufacturing in this country? "You've got to do it with gas. You've got to do it with gas."
And Angus has taken up that challenge and this is what we're talking about today. Do you think the government had a predetermined outcome with this COVID Commission? I mean, were they looking for support for the idea to support a gas-led recovery? You know, I don't know a good answer to that question. My instinct tells me no.
So was there a predetermined outcome? I don't think so. I don't feel it. If you wanted a predetermined outcome from the COVID Commission, I mean, you would have appointed people with this view, from this history, wouldn't you? I mean, was there a predetermined outcome? Well, I would say to you, we have made very clear decisions about where we want to go with our energy system to drive affordability and reliability. Gas is part of that. We're also making significant investments in other technologies like hydrogen, which is an important, a crucial opportunity for this country. And we stand by the decisions we've made as a government on advice from many different sources.
JACQUI LAMBIE: Can you give me a guarantee that absolutely nobody, no people on the commission, will stand to personally gain from that? Can you give me a guarantee on that? I can't do that, Senator. Can you give me...? Why not? Well, I don't know what their individual circumstances are, and it depends on what happens. But, as I said, I think that the benefits of lower gas price, to me, are very broad. Within the task force, there was also some concern about its fixation with gas. Paul Bastian, then secretary of the Australian Manufacturing Workers' Union, wrote to the Prime Minister saying the Union did not believe the Federal Government should underwrite the price of gas and he wrote of his concerns that investment in gas could result in so-called stranded assets.
What are the financial risks in investing in gas? It's basically when you think that something's going to be in demand for longer than it actually is, you make an investment, and then you don't get to get your money back. And that's a very simple way of talking about the financial risk, but we see those financial risks manifesting all over the system, because the whole industrial system is having to sort of change its composition. Former international bank analyst Zoe Whitton advises multinational institutional investors and superannuation funds with trillions of dollars to park in long-term projects. She now advises those investors on climate change and warns that unless businesses begin to wean themselves off fossil fuels, Australian products could face punitive tariffs abroad. WOMAN: If the Australian economy, particularly with this situation that's fast evolving in the EU, if the Australian economy is more emissions intensive, we don't know the details yet, but we suspect what will happen is all of the manufacturers or exporters in that economy will become more vulnerable to a price on the border of the EU, and potentially on other regions like China and the US, eventually, than they would otherwise be. So if you increase the emissions intensity of the Australian system by putting gas-fired power in instead of renewable energy, then you might find yourself bearing that cost across all of your investments.
The body tasked with ensuring the security of the national energy system also thinks the window is closing on the need for new gas infrastructure. Kerry Schott is the chair of the Energy Security Board. The extent of the renewables coming in is extraordinary, both large wind and solar farms, but also rooftop solar. And those things are having a huge impact on the system.
So what is the role that you see for gas in all of this? Look, gas has an important transition role for a time. And I say for a time, because the technology is changing rapidly, and batteries are starting to be able to do more than they could do before. And they're also becoming much cheaper. The government says its gas-fired recovery will stimulate a manufacturing revival. Businesses all over Australia rely on gas, but few need it more than fertiliser manufacturer Incitec Pivot, one of the country's biggest gas users.
Here at its plant in Queensland gas is not just an energy source, it's actually an essential ingredient in the product. WOMAN: Competitively priced gas is essential for the manufacturing industry. Without that, you know, we would have to import the products and close our plants here. The problem is the Australian market is broken, and it's broken because we're paying 300% more for our natural gas than others are.
We compete on fertilisers with other fertiliser manufacturers around the world. So as long as our gas price reflects the gas price around the world, we can compete. The premise of a gas-fired recovery is based on the promise of cheap and readily available gas. Industry groups like Incitec Pivot are now paying about $8 to $10 a gigajoule for their gas. That's more than double the US price, and it's triple the price they were paying a few years ago. I think the really positive thing is Australia is blessed with natural gas.
It has some of the best natural gas resources in the world. And so with that, this is a solvable problem. And I think that it's really about thinking about getting the level playing field.
For many years, Australia's natural gas basins did deliver low-cost gas to Australian manufacturers. MAN: Around the 1970s, we really discovered that we had a lot of what's called natural gas, or methane, in a number of gas resources, or gas basins, geological basins, in the centre of Australia, in south-west Queensland, and also in Gippsland Basin off the coast of Victoria. So the roles of gas expanded quite significantly over the 1970s. And some businesses were no doubt established in Australia because of the availability of low-cost gas.
The fact is, it was a very flexible fuel and chemical feedstock for a whole range of industries, and at the same time was useful for heating our homes, heating our hot water and cooking our food. The end of cheap domestic gas came when gas companies decided to aggressively exploit the export market. Energy finance analyst Bruce Robertson from the pro-renewables think tank IEEFA says the age of cheap gas is behind us. MAN: It wasn't just in the '70s and '80s.
It was right up until 2000 and about 12. We used to pay $3 to $4 a gigajoule for gas. That's over ever since the export part started up and the export companies decided to price gouge the Australian domestic consumer, which they've been doing very consistently ever since. In recent years, East Coast gas prices have gone as high as $20 a gigajoule, and no-one thinks it's realistic to expect it to ever drop back to the US price of around $4.
WOOD: We shouldn't be offering a false hope that cheap gas is the answer. That cheap gas that I've been talking about will never come back again. This is a geological statement, it's an economic statement, it's not an ideological statement. We have basically run out of cheap gas.
MAN: Ultimately, the price that matters for a manufacturer in Australia is the price in Australia relative to what their competitors in other countries are getting. We want to see that gap closed. We want to see internationally competitive prices. That's crucial for our manufacturing sector. And it's also good for our small business and households sectors. Sure. But the US price is lower than $4.
No-one we've spoken to suggests that you could get anywhere near $4. They're talking more like $6 to $8, and that's in the long term. Well, Michael, you can forecast prices all you like. I'm not in the business of forecasting prices. What I am in the business of saying is that Australian businesses shouldn't pay more than their competitors. And that's important.
That is the focus of the government and will continue to be. Some of the manufacturers they talk about parity with the US gas price to make their business viable. And that price is $4 or less per gigajoule. Can we deliver gas in this country at that price? There's no way you can get a $4 number here no matter what the cost of production is.
So you've got to actually net all that out and create a domestic market price that actually makes sense to the producer and makes sense to the consumer. Now, what is that number? Look, we've done studies to the gazoo. The work I did with all the cost bases of the basins that are out there, is we can actually get a number around $6 delivered on the East Coast. Even the gas companies say a return to a gas price on par with the United States is no longer feasible. GALLAGHER: We wouldn't be developing new resources if A$4 was the price that we could get for that gas.
As I say, I think somewhere, depending on the different fields, between $6 and $9 is the range of prices I've publicly stated that I believe is a sustainable sort of range for gas prices on the East Coast. Even if gas does become cheaper, the powerful gas lobby group APPEA says it won't save manufacturing, saying it accounts for less than 1% of the sector's total production costs, and that the competitiveness or otherwise of Australian manufacturing isn't because of the cost of gas. Some manufacturers have made the decision that gas prices are too volatile, and they're already looking for alternatives. Hardwicks Meatworks in Victoria is one of them. MAN: The project's had its challenges. We were sort of an early adopter.
But it's pretty staggering that we've been able to... ..I guess shift so quickly from, you know, a very large grid reliance. Hardwicks uses gas to heat water for its extensive sterilising requirements. It plans to replace most of that gas with a heat pump linked to their refrigeration powered by a 10-acre solar farm.
The business is always looking for opportunities, either to value add or try and drive costs down within the business. That's quite often done by more numbers and those sort of things but, obviously, these projects, they are longer payback but they're driven by, I guess, trying to become a low-cost producer. And economics isn't the only reason behind this dramatic shift. For Hardwicks, there's a social licence imperative as well. It's also helping reduce our footprint, which is a fantastic thing.
I guess also, a responsibility. Red meat is an intensive protein output, so anything we can do as a company to try and reduce our footprint as part of that process is good for us, good for the industry. The biggest breweries in Australia, Carlton & United and Lion, and one of the biggest energy users in Queensland, Sun Metals zinc refinery, have all committed to reduce their reliance on gas, going to 100% renewables by 2040.
We can see this flood of money going into batteries. Some people are saying, "That looks like something that's going to work. "It looks like something that is viable.
"I want to put my money there." And in that conversation, you can see that shifting view in the market playing out in real time. The core of the argument put forward by the COVID commission is about jobs. Andrew Liveris has told the Prime Minister the plan for a gas-fired recovery, and cheaper gas, will create 170,000 high-paying jobs.
Not everyone agrees. WOOD: Even if it was cheap, that would not lead to a manufacturing renaissance as part of the post-pandemic recovery. Because gas does not actually produce that many jobs. I mean, there are some important jobs and some challenging ones in the industry I mentioned, but it's not that many of them. And secondly, if gas was the answer, if cheap gas was the answer, then why didn't it happen before when we had cheap gas? Grattan says the real figure is around about 10,000. And they say that when gas was cheap, back in the 1970s and the 1980s, there was no manufacturing boom.
What is the evidence that it's going to happen this time? I wouldn't even bother reading the stuff that Grattan writes. We're in the middle of a history defining energy transition. And to not develop gas to replace coal is a travesty. To not develop gas to add value to it to create jobs in Australia and let that gas just sit there is another travesty.
Despite all the doubts around the gas-fired recovery plan, the government is enthusiastically pushing to get more gas out of the ground. SCOTT MORRISON: We must unlock new sources of supply. We must get additional gas to market as efficiently as possible, and we must empower domestic gas customers.
We need to accelerate development of new basins like the Beetaloo in the Northern Territory and Narrabri in New South Wales. Central to the government's plans for a gas-led recovery is the exploitation of more gas reserves. And the Narrabri gas fields here in north-western NSW are at the top of that list. The gas company Santos says the 850 gas wells approved for this site will produce more affordable, secure and cleaner energy for the next 20 years. The CEO of Santos, Kevin Gallagher, knows he needs to win over the community. Earlier this year, he was on the ground in Narrabri as the cream of Australian rugby descended on the town for the first annual Santos sponsored festival.
This is just about the communities. And that's what we want to focus on today. It's not even about Santos, frankly, it's just about the communities. And, you know, all of our workers that work in Narrabri, live in Narrabri. And that's really important to us as well, because they're part of the community. If we want to create jobs, well paid jobs, maintain those well paid jobs, I see gas as the natural partner for renewables in that recovery.
If you want to call that a gas-led recovery, then so be it. CHANTING: Shame, Santos, shame! Shame, Santos, shame! Shame, Santos, shame! Some locals feel the project's promise of new jobs and infrastructure isn't worth the long-term pain. Shame, Santos, shame! Around Coonamble and the north-west, it's enormous opposition.
Anne Kennedy and her husband Neil fatten cattle and grow crops on their property at Coonamble, west of Narrabri. Their primary concern is the potential for Santos' gas extraction to contaminate the area's groundwater. (CROW CAWS) ANNE: It's very rich, productive farming land if it rains. We graze cattle, we farm lupins a lot on the lighter country, but here we farm wheat or barley. But my main thing is our artesian water. We wouldn't exist here.
We would literally walk off this land if we didn't have the artesian water. You can't live without water. And, yeah, it's the lifeblood of nearly a quarter of Australia.
The Great Artesian Basin, I think, is the single greatest asset and resource Australia has. The Narrabri gas project has been one of the most anticipated and contentious gas developments ever proposed in this country. Farmers like Anne fear that drilling through the aquifer presents an unacceptable risk. It can't be done safely, I've got so much science.
I'm just a broken down old farmer, but I've got all the experts, groundwater engineers, hydrogeologists, for years have given us evidence. Santos has yet to finally decide if it will take the project forward, but after decades of debate and opposition it was given approval by both the NSW and federal governments last year, provided they met 134 environmental conditions. GALLAGHER: What I can guarantee is that we will work to the highest standards and our commitment is 100% on complying with all of those, I think, 134 conditions we got as part of our approval. So it's a relatively low risk project that will produce the most environmentally friendly, in my view, and lowest cost gas in the region across New South Wales.
And I would say the lowest price gas you're going to get in that market as well. Why is it, do you think, that politicians won't listen to you? What's at the core of their position? Political donations, which we have a lot of evidence of. I'm sorry, that's what it appears to me. This has become a common refrain. Concern about the influence of the fossil fuel lobby has been growing over the past decade as our politics has proved unable and unwilling to implement a clear climate and energy policy. Why do you think the federal government is so fixated on a gas-led recovery then? Donations.
Political donations from fossil fuel companies, is that it? Yes. Yeah. Yeah, it's pretty simple. It's pretty transparent in Australia what's going on at the moment and that's what's happening. It has massively serious consequences. And this is the tragic thing that's happening in Australia. Some of the biggest players in the gas sector have made more than $6 million in political donations to both the major political parties over the past decade.
Far outstripping the amount donated by clean energy companies. The vast majority came from the three giants - Chevron, Santos and Woodside. And gas lobby group APPEA has forked out close to a quarter of a million dollars over the last two years. It's well documented that gas companies have made significant donations to both political parties.
Do donations influence that policy position? No, absolutely not. Look, we've seen obviously the energy companies across the board, renewables, gas, others, play a role in the political process for decades. That's not new, but ultimately we make decisions on what's right for Australians. And that is exactly what we're doing with our focus on gas and other technologies.
Clearly that gives some people significant access, doesn't it? I mean, people don't make big donations like fossil fuel companies without expecting something in return. And that, in return, is generally access. Well, I can assure you that I give access to all stakeholders in the energy sector and have done since I became minister. I talk to stakeholders on a continual basis, and that's an important part of what the government has to do. We have to listen to what's going on. We have to listen to the perspectives of stakeholders.
Santos is obviously a big donor to both political parties. How much are you donating to political parties? Without talking about the specific numbers, because I don't actually know that number off the top of my head, although we can get it for you, what I would say is that we're very, very keen to support the political establishment here in Australia and support both sides of politics equally, and that's very important to Santos. Presumably you want favourable outcomes from government, as well, through policy. I mean, you don't donate for nothing, do you? What I would say is the access we get to both sides of politics is important to us from the point of view that we get to state our case, right? And that's no different to any other industry or any other company that does the same thing, which is most companies, I would say. But we don't actually want any particular policy outcome other than stability. I mean, I think one of the challenges we've had here in Australia over the last decade is nobody quite knows what the energy policy is going to be for Australia going forward.
Regardless of policy uncertainty, technology is rapidly advancing beyond fossil fuels. WOMAN: Ten years ago we were talking about gas as a transition fuel, and we were saying what we think will happen is that at the moment we use coal to produce electricity, majority. We'll start using more gas, and we'll switch off coal, and then eventually we'll switch to renewables.
And we used to talk about that window as taking decades. And what's happened in the intervening 10 years is that the price of renewables has dropped like a stone, and batteries alongside them. And the success of renewables has basically shortened that window for gas. Because now we're talking about switching from coal to renewables with batteries, and that's happened extraordinarily fast. While energy security and climate policy is a federal concern, electricity generation is primarily a state responsibility and the states are looking at how they can move beyond gas as fast as possible. The NSW Coalition government's energy response has been to aggressively fast track renewables.
MAN: The cheapest way to now deliver electricity or energy, is a combination of wind, solar, pumped hydro, and renewable technologies. So it's not fossil fuels, it's now cleaner energy. Those people defending old technologies are the equivalent of defending Blockbuster in a Netflix world. In NSW, four out of the five coal-fired power stations are set to close in the next 15 years. The Liddell Power Station in the Hunter Valley will close in 2023.
NSW Energy Minister Matt Kean's solution is an ambitious plan to encourage private investment in batteries and renewables. If you're going to get to net zero emissions by 2050, then you need to be out of fossil fuels by the mid 2030s. So, yes, we need gas now, but we need a plan to move away from gas. I'll listen to the engineers and the experts. And that's exactly how we design energy policy in New South Wales. New South Wales energy policy is determined by engineers, experts, and economists, not ideologues.
Federal Energy Minister Angus Taylor says the closure of Liddell will leave New South Wales short of power. The federal government is convinced gas is the answer, and is seeking to impose a solution that New South Wales says it doesn't need - a new gas-fired power station, funded by the taxpayer if necessary. TAYLOR: We are saying that we will step up if the private sector doesn't step in. Now, we know from our own modelling, if there's not a significant piece of capacity replacing the loss then there'll be upward pressure on prices.
They should be up front with the Australian public. Someone's got to pay for it. So why would they be exposing taxpayer dollars, or those that pay higher electricity prices for infrastructure that's not needed? The federal government says the Liddell closure will leave New South Wales 1,000 megawatts short of electricity. Others dispute this, including the agencies tasked with ensuring the future security and stability of the energy system, the Australian Energy Market Operator and the Energy Security Board. WOMAN: The operator AEMO, who keeps a close watch on the availability and what they need in the system, has said that there's a gap when Liddell goes in 2023 of about 200 megawatts or so. Well, why does the Federal Government, for instance, continue to stick to this 1,000 megawatt figure? I don't know, Michael. I'd ask them.
Why do you keep insisting it's 1,000 megawatts? Because that's reliability. There's also affordability. There's two things we have to worry about here with losing a major piece of capacity. Four Corners understands the Federal Government became so frustrated with the Energy Security Board chief's refusal to support their position on gas that the minister's departmental secretary called Kerry Schott and urged her to resign.
It was a private discussion. Right, so there was pressure on you, though? Oh, there's always pressure on me. I guess the point is is the federal minister reluctant to accept advice he doesn't want to hear? Oh, I think probably most people are in that category. But not...I wouldn't put him particularly in that category more than other people. Why did your head of department call Kerry Schott and suggest she resign? Well, he didn't.
So I reject that, absolutely. But what I will say is that there was an independent review of the ESB that proposed and recommended the abolition of the ESB. Obviously, there was discussion about how best to respond to that recommendation. We've ultimately made the decision we want to support the ESB to completing the 2025 market design work.
This is a crucial piece of work about the future of our electricity grid. And we strongly supported Kerry to lead that work. Four Corners has also been told that last year the minister personally intervened to try to pressure the head of the Australian Energy Market Operator to change its forecasts, which were unfavourable to gas. AEMO boss Audrey Zibelman refused to do so.
AEMO's Integrated Systems Plan published in July last year also makes a clear case that if gas is going to compete with batteries in electricity generation, the price will need to be well below $4 a gigajoule by 2030 and beyond and that battery charging costs would need to stop falling. Now, why did you feel it necessary to try to pressure Audrey Zibelman to change those conclusions? Well, look, at the end of the day, there has to be a balance in the system and gas is part of that balance. Batteries can play a particular role over shorter durations, particularly in that period when you've got destabilisation of the grid. We've seen batteries play an enormously important role. But the longer duration storage or the longer duration backup overnight or during periods when we're getting less sunshine or wind, we actually need a source of energy.
(BELLS RINGING) Can I just... Is that me? Sorry, mate. I have no choice. We just have... Mm. OK.
I don't...I don't have any choice. The bells signalled a parliamentary vote and cut our interview with the Minister short. Alright. We've got two more questions. Yeah, I know. I just don't have any choice. But in response to written questions, his office said undue pressure was not exerted on AEMO's CEO and that the Minister was simply seeking to understand how AEMO modelled a future gas price. New South Wales isn't the only state looking to leapfrog the Federal Government's vision of a gas-fired recovery.
The Liberal state government in South Australia is also betting the future on batteries. Here at the site of South Australia's largest gas power plant, work is about to begin on another huge battery project. Infrastructure to support renewables is attracting almost all the investment interest.
The fact is technology is moving way faster than politics. To be blunt, politics doesn't play a great part of this for me in South Australia. I'm a pretty nuts and bolts, down to earth person. My job in this area is get the cost of electricity down for households and businesses, have fewer and fewer blackouts, make it far more reliable, and very importantly, our whole government is focused towards lowering our emissions from not only electricity generation, but other things. Although it does still see a small role for gas in the short term, South Australia is committed to a fully renewable future.
We'll use less and less gas over the time. We have four grid scale batteries operating at the moment in South Australia, we have two more already established to... ..started construction, and we'll get more and more of those. However long gas will be in the system, in South Australia there's a new fuel source on the horizon and it's creating considerable excitement - hydrogen. MAN: There's an awful lot of investment going in to hydrogen. Normally, when an awful lot of investment goes into doing something, something comes out the back end.
These people don't spend an awful lot of money, usually, without something coming out the back end. Hydrogen is one of the most abundant elements on earth. To make it into a fuel requires a huge amount of power. But if it can be done with renewables it could be the clean answer to the world's energy problems. Large-scale production of green hydrogen is still about a decade away, but confidence is high. We in South Australia actually have the largest hydrogen electrolyser in the nation operating at the moment in Tonsley, in the southern suburbs of Adelaide.
It's actually a relatively small one at 1.25 megawatts, but it's the largest in Australia. We are right at the leading edge of that, and it's all operating from renewable energy. So we are determined to deliver... Well, we're determined to produce and to consume and to export green hydrogen in South Australia.
Australia finds itself at a fork in the road. Do we rush headlong towards a renewable future or do we underwrite a slower transition with new gas infrastructure? The danger is if we cling to the certainties of our fossil fuel past, we'll discourage investment in new technology and miss the opportunities and benefits of the new energy age. MAN: I think gas is a beautiful segue, to take away your fork in the road comment.
It's not either/or. I actually have a bridge in the fork to enable me to get to a full renewables future. And I think that's the beauty of gas. TAYLOR: Gas will help and is helping to drive more affordable, reliable energy in this country. It can help us to bring down emissions.
It's the perfect complement to intermittent renewables, as the former chief scientist, Alan Finkel, has told us. And so it has an important role in the system. WHITTON: There here have been many transitions in history, and there are often regions that are left behind because they didn't respond in the right way. If we continue to tell ourselves that this is something that we can make a decision about, rather than a decision that is made by the world, then we might find ourselves like many of those industrial regions in the '80s that found themselves stranded as industrialisation moved east. KEAN: The choice is very clear.
We can either get ahead of the curve and can continue to create jobs and drive prosperity, or we can be left behind. Captions by Red Bee Media Copyright Australian Broadcasting Corporation