by Rob Wheals, CEO and Managing Director, APA Group
Pipelines have long been the backbone of Australia’s energy system, and as Australia continues on its path to a clean energy future, our existing network will have a critical role to play for decades to come.
The shocks in electricity generation over winter in Victoria and Queensland were reminders of why we are so heavily reliant on gas. When it comes to our energy mix, gas is the workhorse. It can be turned on in minutes, and can stay on for days, giving it a unique ability to provide firming in Australia’s energy mix.
Indeed, these events, including a coal outage in Queensland, flooding at Yallourn in June and technical issues that impacted production at the Longford gas plant in July, along with cold weather, underscored the critical role that gas plays across the national electricity market.
It was gas and gas infrastructure that stepped up to provide secure supply in real-time in response to this perfect storm of events. When the production dipped at the Longford gas plant in July, it was the flexibility of APA’s 7,500km of interconnected gas transmission pipelines that form the East Coast Gas Grid that enabled us to get gas from the north to the south – helping address the shortfalls while ensuring the lights and the heaters of Victorian homes stayed on.
That’s because our gas infrastructure enables us to seamlessly move gas throughout eastern Australia, anywhere from Otway and Longford in the south, to Moomba in the west and Mount Isa and Gladstone in the north, maximising every ounce of capacity to support gas generation.
Even as coal is retired and renewables penetration accelerates, the firming role of gas generation will be critical to ensure the stability of the electricity grid. Gas will continue to be critical to ensure we can keep their lights on when the sun isn’t shining and the wind isn’t blowing, helping to ‘firm-up’ the energy grid.
But while gas will continue to play a critical part in our nation’s energy mix, APA also understands that there are opportunities in supporting the development of technologies that can support Australia’s transition to a low carbon economy. And as new technologies come online – like hydrogen and biogas – it will again be gas infrastructure that will be critical to getting into homes and businesses.
As we look ahead to 2050 and beyond, the gas industry is well placed to diversify and deploy decades of knowledge, capability and critical infrastructure to play a leading role in developing the low emissions technologies of tomorrow, at scale, and to support our own ambitions for a net zero future.
Indeed, a recent Frontier Economics study showed that continuing to use gas infrastructure can reduce emissions at about half the cost to customers than electrifying the services provided by gas. It’s something that APA is working to support by getting ready now to support the carriage of different forms of gas in our pipelines and by investing in projects that will support the development of a clean hydrogen industry in this country.
When it comes to hydrogen, it is absolutely clear that Australia has a natural competitive advantage. While there are economic challenges, and the science of developing a clean hydrogen economy continues to develop, we are a step ahead with an abundance of wind and solar to power the production of renewable “green” hydrogen and an existing network of pipelines potentially capable of transporting hydrogen for domestic use or export.
APA’s 15,000km of gas pipelines not only connect our cities and regional areas, but they are linked and adjacent to some of the best geographical locations for hydrogen production in the country, such as renewable energy zones. That’s why we’ve partnered with the Future Fuels CRC and Wollongong University, in a world-leading partnership, to help us understand the capacity of our own transmission network to transport hydrogen.
We have a project underway investigating the conversion of a section of gas pipeline in Western Australia to 100 per cent hydrogen. And while there is more work to do, the early testing results are positive.
This pilot project was APA’s first project under our Pathfinder program – a new initiative that will help unlock energy solutions of the future – and would make the Parmelia Gas Pipeline one of only a few existing gas transmission pipelines in the world, 100 per cent hydrogen-ready.
The launch of the Parmelia Gas Pipeline pilot project follows APA’s continued progress towards a sustainable future, including APA’s ambition to achieve net zero operations emissions by 2050.
As a proud Australian business, we are thrilled to be bringing international best practice to Australia in this national first, which we expect will test and prove the capacity of the existing gas transmission pipeline network to transport hydrogen in pure form or blended with natural gas.
With billions of dollars invested in gas infrastructure across the country, it makes sense to look at ways to use our existing energy infrastructure to support Australia’s transition to a low carbon future. The Parmelia Gas Pipeline project will be completed in three phases, including: research and testing of the material for embrittlement in the laboratory; development of safe operating guidelines, and full-scale testing on-site.
In an Australian-first, a new laboratory is being established at Wollongong University to test materials, which are representative of the pipeline, under pressurised hydrogen gas conditions. After proving the pipeline is hydrogen-ready, we will then need to consider ongoing work with potential producers and customers to understand the infrastructure and connection requirements to commission the pipeline as a hydrogen service.
The pilot project results will also support decision-making for the potential transition of other APA assets to be hydrogen-ready. The energy transition is underway and APA is investing and adapting but in the meantime, gas is playing a critical role in grid stability.
The shocks we experienced during winter underscore the role that gas plays in grid stability and reliability. So, while the industry is rolling up its sleeves to support the development of low emissions technologies that can steer Australia’s energy transition towards a net zero pathway, we should be in no doubt about the critical role gas will continue to play in our nation’s energy mix.