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One thing to note is that, contrary to the assertions of some via the mainstream media, the interest in batteries and renewables doesn't mean gas has suddenly become obsolete.
Here's some official Australian government gas consumption data for 2017-18 (latest that seems to be online) for the south-eastern states where supply is of concern in the coming years:
Victoria:
Electricity generation = 51.0 PJ (3830 GWh or 8.1% of electricity generated in Victoria)
All other gas use = 240.3 PJ
NSW (includes ACT):
Electricity generation = 26.2 PJ (3046 GWh or 4.2% of electricity generated in NSW)
All other gas use = 106.6 PJ
SA:
Electricity generation = 71.4 PJ (7753 GWh or 52% of electricity generated in SA)
All other gas use = 55.4 PJ
Tasmania
Electricity generation = 8.6 PJ (980 GWh or 8.3% of electricity generated in Tasmania)
All other gas use = 4.8 PJ
Total south-eastern Australia:
Electricity generation = 157.2 PJ
All other gas use = 407.1 PJ
So overall 72% of gas consumption in south-eastern Australia is used for purposes not relating to electricity supply. Unless consumers undertake a mass shift away from the use of gas, that demand for gas remains no matter what happens so far as power generation is concerned.
For the other 28%, realistically some decline is likely but it's not going to zero anytime soon.
First because those figures include electricity generated from gas by industry, mining and so on for their own use on site. If they're not connected to the grid anyway then it's irrelevant to them what happens with grid supply.
Second because it includes co-generation facilities which are connected to the grid but where some facility, eg a factory or hospital, needs the by-product heat from the power station. That means it will run, because they need that heat, no matter what the overall electricity supply situation is. Failing that, they'd switch to their backup boilers and be burning gas in those instead so either way they're using gas unless they go as far as switching to some other fuel.
Putting that into perspective, off-grid and co-generation gas-fired electricity is roughly 30% of total gas-fired electricity in Victoria and NSW and closer to 10% in SA and Tas.
Third because in general the energy companies are building batteries and pumped storage due to plant which is closing due to reaching end of life and, with some exceptions, that plant is mostly coal not gas. At this stage nobody's proposing a complete abolition of gas-fired generation.
So it's fair to say that ~80% of the market for natural gas in south-eastern Australia is not impacted by what goes on with renewables, storage etc at least in the short term since it's either not for power generation at all or it's off grid or co-generation.
Of the remaining ~20%, some reduction is possible but not to zero anytime soon. We won't see zero use of gas-fired power in the medium term.
So there's still an ongoing need for natural gas at least in the medium term and that means there's still a market for gas producers, pipeline companies and so on to operate in noting that a substantial volume of existing production is exiting the market in the next few years due to field depletion. Ignoring the politics and focusing on the financial, if listed companies such as Santos (ASX: STO) and others go ahead with their proposals then they'll find a buyer for the gas.
Here's some official Australian government gas consumption data for 2017-18 (latest that seems to be online) for the south-eastern states where supply is of concern in the coming years:
Victoria:
Electricity generation = 51.0 PJ (3830 GWh or 8.1% of electricity generated in Victoria)
All other gas use = 240.3 PJ
NSW (includes ACT):
Electricity generation = 26.2 PJ (3046 GWh or 4.2% of electricity generated in NSW)
All other gas use = 106.6 PJ
SA:
Electricity generation = 71.4 PJ (7753 GWh or 52% of electricity generated in SA)
All other gas use = 55.4 PJ
Tasmania
Electricity generation = 8.6 PJ (980 GWh or 8.3% of electricity generated in Tasmania)
All other gas use = 4.8 PJ
Total south-eastern Australia:
Electricity generation = 157.2 PJ
All other gas use = 407.1 PJ
So overall 72% of gas consumption in south-eastern Australia is used for purposes not relating to electricity supply. Unless consumers undertake a mass shift away from the use of gas, that demand for gas remains no matter what happens so far as power generation is concerned.
For the other 28%, realistically some decline is likely but it's not going to zero anytime soon.
First because those figures include electricity generated from gas by industry, mining and so on for their own use on site. If they're not connected to the grid anyway then it's irrelevant to them what happens with grid supply.
Second because it includes co-generation facilities which are connected to the grid but where some facility, eg a factory or hospital, needs the by-product heat from the power station. That means it will run, because they need that heat, no matter what the overall electricity supply situation is. Failing that, they'd switch to their backup boilers and be burning gas in those instead so either way they're using gas unless they go as far as switching to some other fuel.
Putting that into perspective, off-grid and co-generation gas-fired electricity is roughly 30% of total gas-fired electricity in Victoria and NSW and closer to 10% in SA and Tas.
Third because in general the energy companies are building batteries and pumped storage due to plant which is closing due to reaching end of life and, with some exceptions, that plant is mostly coal not gas. At this stage nobody's proposing a complete abolition of gas-fired generation.
So it's fair to say that ~80% of the market for natural gas in south-eastern Australia is not impacted by what goes on with renewables, storage etc at least in the short term since it's either not for power generation at all or it's off grid or co-generation.
Of the remaining ~20%, some reduction is possible but not to zero anytime soon. We won't see zero use of gas-fired power in the medium term.
So there's still an ongoing need for natural gas at least in the medium term and that means there's still a market for gas producers, pipeline companies and so on to operate in noting that a substantial volume of existing production is exiting the market in the next few years due to field depletion. Ignoring the politics and focusing on the financial, if listed companies such as Santos (ASX: STO) and others go ahead with their proposals then they'll find a buyer for the gas.
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