How natural gas can minimise greenhouse emissions

Australia’s natural gas reserves have the unique potential to significantly reduce greenhouse gas emissions at low cost.

This could occur both within Australia through the greater use of natural gas (particularly for electricity generation), and throughout the Asia Pacific region by increasing liquefied natural gas (LNG) exports.

Natural gas offers the cleanest viable source of large-scale baseload and peaking power. When combined with other low or no-emissions fuels it can contribute enormously to reducing the growth in Australia’s greenhouse gas emissions. Electricity produced from gas produces 50-70% less greenhouse gas emissions than current coal-fired power generation facilities.

As LNG, gas can also cut emissions in overseas export markets. For every tones of greenhouse gas emissions generated by LNG production in Australia, between 4.5 and 9 tonnes are avoided in Asia when this gas is substituted for coal in electricity generation.

Yet Australia’s tax regime disadvantages gas against coal, while subsidies and renewable energy targets disadvantage gas against renewable energy. A level playing field that allowed fuel-on-fuel competition would greatly enhance Australia’s effort to address climate change.

Throughout the world, national and regional policymakers are considering a variety of legislative and regulatory options to mitigate greenhouse gas emissions. Assessing these options requires understanding their likely effectiveness, scale, and cost, as well as their implications for economic growth and quality of life.

An appropriately designed national climate change policy should lead to more natural gas being used in Australia’s power generation and resource processing. This is because currently available natural gas technologies produce only 30 to 50% of the emissions produced by current coal technologies in generating electricity.