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Four of Australia’s top energy infrastructure companies have underlined the critical role of gas in reaching net zero emissions during consultations with the Victorian Government’s Gas Substitution Roadmap.

Industry leaders AusNet Services, Australian Gas Infrastructure Group (AGIG), APA Group and Jemena, who together transport more than half of Australia’s natural gas, pointed out the benefits in transitioning Victoria’s energy supply to a gas alternative.

Independent analyses show that energy consumers can save between $12$14 billion per annum from 2050 in ongoing maintenance and capex costs if natural gas is retained in Victoria and the country’s energy system. The development of renewable gases such as hydrogen and biomethane offers a pathway to fully decarbonise the Victorian energy grid.

AGIG said that developing a framework to provide similar support for the renewable gas sector as that provided to the renewable electricity sector is key to efficiently and effectively decarbonise energy supply, retain customer choice and improve energy security and reliability for Victorians.

AGIG CEO, Ben Wilson, said, “Blending renewable hydrogen into gas networks is a crucial early step to ramp up supply growth, thereby bringing costs down. This is exactly the same pathway taken for the renewable electricity sector. 

“By getting the foundations right, Victoria can build a thriving hydrogen industry that provides carbon free gas to residential through to large industrial customers in the state, along with other  complementary markets such as transport. 

 “Building the scale and capability now, by blending renewable hydrogen into gas networks to supply homes and businesses, will also position Victoria to benefit from a substantial new export opportunity. 

“We are talking exporting our sunshine from our rooftop solar systems to the world through hydrogen. This means thousands of new jobs in Victoria in this emerging carbon-free industry, including in regional areas.” 

AGIG plans to deliver a 10 per cent renewable hydrogen blend across all of Victoria by 2030, and to reach 100 per cent hydrogen by 2040. Currently, it delivers a 5 per cent renewable hydrogen blend to a portion of its South Australian customers.

AusNet services Managing Director, Tony Narvaez, said, “AusNet is at the forefront of Victoria’s energy revolution as we transition our local distribution networks through rooftop solar and our state-wide transmission system to large-scale renewable generation. Transitioning to renewable gas is the next chapter in Victoria’s decarbonisation pathway.” 

Jemena’s Managing Director, Frank Tudor, reiterated his company’s call for a Renewable Gas Target to be established as a viable means of jump-starting the renewable gas sector.  

“The Renewable Energy Target (RET) proved crucial in driving down the cost of renewable  electricity generation technologies such as solar and wind power,” said Mr Tudor.  

“A Renewable Gas Target will perform the same role in the gas sector and would help to make hydrogen at $2 per/kg – as outlined in the National Hydrogen Strategy – a reality sooner.”

APA’s CEO and Managing Director, Rob Wheals, said, “As coal is retired, natural gas will continue to play a critical role in ensuring electricity grid stability and helping Victorians keep the heater running and the lights on in winter.

“However, as technology develops, Victoria’s existing gas infrastructure will be vital to  connecting Victorians to the energy solutions of tomorrow, like hydrogen and biogas – and APA’s pipelines are adjacent to some of the best geographical areas for hydrogen production in Australia. 

“With billions of dollars invested in gas infrastructure across the country it makes sense to look at ways to efficiently use our existing energy infrastructure to support Victoria’s  transition to a low-carbon future.”  

Collectively AusNet Services, AGIG, APA, and Jemena are already investing over $130 million in projects designed for the application of renewable gases such as hydrogen and biomethane in residential, industry, and transport settings.  

Renewable gas will also ensure the ongoing viability of those industries which cannot be easily electrified – such as manufacturing and steel-making – which currently rely on gas as a crucial feed-stock for their operations.  

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