Grattan Institute Report – Flame out: the future of natural gas

Source: The Grattan Institute

19th November 2020

The Grattan Institute, an independent think tank, recently released a report on 15th November on
the future of natural gas in Australia. The report suggests that the Federal Government’s hope for
a gas-fired recovery from the COVID-19 recession is misplaced, as the gas sector faces the
challenge of high prices and the need to reduce emissions.

Natural gas has been a valuable energy source in Australia for more than 50 years. But it faces
two challenges. Firstly, Australia must reduce emissions over time to meet our climate change
targets. Secondly, the east coast will not go back to the good old days of low-priced gas, making
gas an increasingly expensive energy source.

The reality is that eastern Australia faces unavoidably expensive gas, and the impact will be felt by
manufacturers and power generators, and by small businesses and households. If the Government
tries to interfere through direct market interventions, it will probably require ongoing subsidies at
great cost to taxpayers.

The report states that natural gas is in decline in Australia. The only rational approach, for
governments, the energy industry, and its customers, is to begin planning for a future without
natural gas, or at least with a substantially reduced role for natural gas.

Read more HERE