Powered by momentummedia
nestegg logo
Powered by momentummedia
Powered by momentummedia
nestegg logo
nestegg logo

 

 

Invest

Does a gas-powered recovery benefit the Australian economy?

  • May 21 2020
  • Share

Invest

Does a gas-powered recovery benefit the Australian economy?

By Cameron Micallef
May 21 2020

While the Australian government is pushing that “cheap gas can power the Australian economy”, a think tank has argued that it is self-serving for the gas industry.

gas-powered recovery Australian economy

Does a gas-powered recovery benefit the Australian economy?

author image
  • May 21 2020
  • Share

While the Australian government is pushing that “cheap gas can power the Australian economy”, a think tank has argued that it is self-serving for the gas industry.

gas-powered recovery Australian economy

Energy Minister Angus Taylor is pushing hard for a “gas-fired recovery” following the pandemic, as he believes cheap gas will help everyday consumers and businesses. 

The Australian Institute argued, however, that the Prime Minister’s hand-picked National COVID-19 Coordination Commission is stacked with former fossil fuel executives and operates without proper scrutiny, oversight or transparency.

“And now another secret review conducted by a hand-picked gas executive has – surprise, surprise –recommended redirecting emissions reduction funding into failed carbon capture and storage and to big emitters,” the think tank’s report noted. 

New analysis from the Australia Institute’s Climate and Energy Program found that using COVID-19 recovery funding to subsidise the gas industry would create few jobs, increase emissions and lock in higher energy prices.

Advertisement
Advertisement

“It’s a lose-lose-lose strategy,” the report found.

“COVID-19 recovery spending is a once-in-a-generation opportunity to rebuild Australian manufacturing using cheap, clean renewable energy and new equipment to electrify industrial processes.”

However, the gas industry argues that a gas pipeline from Western Australia to Australia’s eastern states and energy-intensive manufacturing out west will play a role in Australia’s economic recovery. 

Nev Power, chairman of the government’s National COVID-19 Coordination Commission, yesterday noted that cheap gas would benefit households and energy-intensive manufacturers who have been struggling under high gas prices for years and would also lower the electricity price and fast-track the transition to baseload renewable energy.

The Australian government plans for tax reform and deregulation of the system and cheaper gas on the east coast, which it hopes will increase Australia’s economic prosperity in the longer term.

However, the gas industry itself is currently struggling due to a combination of an increase in supply and a crash in world oil markets, which has seen the price plunged from $11 a gigajoule to around $4, which the gas companies see as unsustainable.

The government has signaled that it intends to facilitate lower cost gas by providing the regulatory regime to enable increased production and the construction of new infrastructure, such as pipelines.

In addition, of the 12 projects shortlisted under its pre-pandemic policy to underwrite reliable generation, five are gas projects.

Does a gas-powered recovery benefit the Australian economy?
gas-powered recovery Australian economy
nestegg logo

Forward this article to a friend. Follow us on Linkedin. Join us on Facebook. Find us on Twitter for the latest updates
Rate the article

About the author

author image

Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

About the author

Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

more on this topic

more on this topic

From the web

Recommended by Spike Native Network

More articles

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.