Gas giants flex muscles in carbon tax fight
Crikey intern Laura Griffin writes: The Australian media is abuzz today with news of a campaign by the gas company giants for exemption from the carbon tax.
More specifically, the leaders of the major companies involved with liquefied natural gas (LNG) production have been interviewed on the radio, in newspapers and articles about it appear through the web.
This media blitz coincides with the Australian Petroleum Production and Exploration Association’s annual conference, which is taking place in Perth today.
For starts, The Australian ran an article titled ‘Gas giants seek carbon tax breaks‘. It quotes executives from Woodside Petroleum, Santos and Chevron Australia criticising the carbon tax as ineffective and dangerous to investment in LNG and Australian economy in general, especially since, they say, other countries have shirked away from carbon tax and emission trading schemes.
The article also (rather audaciously) pre-empts what Resources and Energy Minister Martin Ferguson was to say in the conference’s opening speech today: “LNG demand is predicted to more than double within 25 years, reaching 360 million tonnes a year and Australia is on track to be the world’s second-largest supplier of LNG by 2015.
“As a cleaner-burning fuel that can be reliably supplied to meet base-load generation requirements, LNG can meet rising global energy demand, while at the same time reducing greenhouse gas emissions,” it quotes Ferguson.
The Sydney Morning Herald this morning added that claims about LNG’s greenhouse fighting credentials are based on an APPEA report that shows that “[f]or every tonne of emissions associated with natural gas, Chinese power generators produce 4.3 tonnes using imported coal”.
The executive summary of this independent (yes, independent but funded by APPEA) report, available on APPEA’s website, claims to examine the cradle-to-grave emissions of coal seam gas (CSG).
Specifically, the report looks at emissions from CSG once it has been compressed into liquid form (LNG) and exported to China. A comparison is then made between burning this gas for electricity using various different types of generators and asks how this compares to coal.
The report claims burning coal seam gas emits less (but still a significant and problematic amount of) greenhouse gas than coal.
Crikey regular Graham Readfearn highlights on his blog the problem with describing this report as independent:
What should be noted, however, is that the report which attempts to paint CSG as a good guy was carried out by a giant resource industry service company, WorleyParsons.
Late last year, WorleyParsons won a $580 million contract to deliver “engineering, procurement and infrastructure” to a $15 billion CSG-LNG project in Queensland.
So the “independent” report was written by a company with a $580 million stake in the same industry they’re examining.
The Sydney Morning Herald did, however, report the MP Ferguson will meet with LNG and steel industries this month. Ferguson is a proponent of LNG, saying Australia will be the second biggest supplier of natural gas by 2015.
The Herald Sun outlines that the $130 billion in LNG investments being considered, “are waiting to see how the Government designs its carbon tax before they spend.”
On ABC’s current affairs morning radio show AM, Don Voelte, CEO of Woodside Petroleum said, “Everywhere else in the world understands gas. I will tell you, people in the United States see gas as the saviour — cheap, clean, transitional fuel to a better world.”
But this assertion also needs to be scrutinised.
An article in this month’s Time magazine, says that oil and nuclear crises “…have opened space for gas as a relatively clean, relatively cheap fuel that can help fill the world’s needs during the transition to a truly green economy. (As important as renewable energy is, it will likely take years for green power to shoulder the electricity load.)”
“[I]f all goes well, gas should help displace: coal. From mountaintop-removal mining to its impact on climate change, cheap coal is toxic to the human race.”
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Shouldn’t the gas company giants be arguing for a higher carbon price? After all, if coal produces 4.3 times the amount of carbon dioxide equivalent, then they should pay 4.3 times the carbon price. The higher the price, the cheaper gas looks compared to coal.
It’s wrong to think gas is going to help climate change. A recent study by Cornell Uni. Professors found that LNG is worse for green house gas emission than coal. View the lecture here: http://www.eeb.cornell.edu/howarth/
Yes natural gas is a marginally ‘cleaner’ energy source than coal, but coal seam gas (as I understand it) is less so.
Coincidentally, I’ve just read ‘Crossing the Energy Divide: Moving from Fossil Fuel Dependence to a Clean-Energy Future’ in which the Ayres brothers make the point that the ‘bridge’ to a renewable energy future will come from increased efficiency in our use of energy, combined heat and power generation (especially decentralised applications), using waste heat and steam from industrial processes, better urban design and transport systems etc etc. Rather than staking everything on new sources of fuels per se.
http://www.informit.com/store/product.aspx?isbn=0137015445
Understanding that we can do more with what we already have while bringing renewables up to speed has greatly reinforced my support for this carbon tax.
All the energy going into this CO – AGW theory is distressing.
We need to tackle pollution , NOT chase after this CO2 Phantom.
Reducing fossil fuel consumption will not materially change Earth’s atmospheric temperature.
The whole CO2 incineration – acceleration model is based on the Kiehl-Trenberth Energy Balance diagram which shows that the “scientists” involved in its production have a poor understanding of thermodynamics and the role played by CO2 in heat exchange in the air.
It is sensible, to every now and then, take a step backwards and consider what is behind the Global Warming fuss.
Is it science or politics or a genuine feel for the environment, or is it perhaps money , power and influence.
Somebody is taking us for a ride.
danr, take your denialist Coal funded bullsh*t and bugger off.
This is a discussion thread about the politics of a carbon tax, the Natural gas industry’s potential as a transition fuel on the road to 100 % renewables, how to realistically meet the world’s (and specifically Australia’s) energy needs within a CO2 emissions constrained framework, and how all of these elements interact.
If the quality and relevance of your contribution is going to be limited, for the thousandth time, to yet again repeating lies and worn out denialist catch phrases, in an attempt to derail any constructive discussion of these highly important issues, then piss off.
Go and find an article in which the content actually caters to your lowbrow attempts to manufacture doubt.
@ Greenfield,
“Shouldn’t the gas company giants be arguing for a higher carbon price? After all, if coal produces 4.3 times the amount of carbon dioxide equivalent, then they should pay 4.3 times the carbon price. The higher the price, the cheaper gas looks compared to coal.”
The Oil and Gas Industry are pushing very hard for a carbon price in Australia between $20 per tonne, and $100 per tonne.
The economics of a Carbon Price between these limits, will result in the large scale conversion of Electricity Generation in Australia from Coal to Gas.
Cap’n
There is no point having a carbon tax unless CO2 is actually likely to cause that problem ie. runaway global heating.
Currently there are no measurements which show that AGW is real.
Indeed, many very localised graphs are showing that when comparing atmospheric temperature and CO2 levels some thing interesting shows up.
Temperature forces CO2.
High temperature fiorces CO2 up and reduced temperature leads CO2 down.
Ref Mauna Loa et al 2010
You will have to try harder than that my denialist neuroscientist physiologist climate scientist combustion engineer friend.
My engagement with you is strictly limited, to pointing out to others, exactly what you are trying to do.l
Get people to engage in a manufactured debate to give the impression of evenly divided opinions.
Sow doubt about the well established causation of AGW.
Reinforce the threatened position of your coal mining employer.
Captain Planet #8
Too right. Let’s have a look at the quality of danr’s work:
Clearly no understanding of the difference between positive feedback and runaway positive feedback. You could put a mathematical funciton in his back yard and he wouldn’t even know what it was.
Nope, wrong. But there’s no point on engaging such delusional counter-factual statements with actual facts as you’ll ignore them, or engage in nutjob conspiracy theory nonsense by way of distraction.
Oops, danr is confused by the difference between CO2 and Water vapour. Presumably he likes to bathe in dry ice.
Ooh look an alleged scientific reference. I didn’t know volcanoes could write. Anyway, not content with not being able to tell the difference between CO2 and H2O danr then shows that he doesn’t believe in annual solar cycles (i.e. seasons). I recommend that he gets himself a new bikini and pair of thongs for the coming cold part of the year.
Presactly – Latest research shows that frakking and shale gas etc release a lot more methane into the atmosphere than previously estimated
http://climateprogress.org/2011/04/12/shal-gas-bridge-fuel/
Now that we appear to have rid ourselves of our resident troll, and got the discussion back on track….
I was not aware that there were researchers uncovering evidence that suggests gas (even natural gas) may have an equivalent total greenhouse gas emissions profile to coal – as alleged in the video link posted above (thanks Cole).
I would be interested to see what other researchers think of this, because if it is true, then the concept of natural gas as a transition fuel just got blown out of the water.
Captain:
I think the upshot is that it depends on the warming potential of the short-residence time methane. If it locks us in to long term warming then it’s not good. On the other hand, if the short term residence time means that the long term warming potential is not as great as for CO2 then it’s not as bad as it looks. Assuming that the long term warming effect of methane is much smaller than the long term warming effect of CO2 (possibly an optimistic assumption) then the effect is about half of that of coal. This in itself is not a particularly good solution, but might buy some time.
Cities are warming.
The planet is NOT.
Equilibrium rules.
*sigh* yet more thoroughly discredited climate delusional nonsense.
I wasn’t aware that methane had a “short residence time” kd, would you care to expand?
Captain:
Actually it looks like those guys have already factored residence time into their calculations (72X greater than co2 over 20 years, 20X over 100 years, approaching 1 over 500 years), so my comment is probably not terribly valid, although it depends on how heroic the assumptions about shale gas are.
Gas can be efficiently burnt in a combined cycle generator. This is where the gas is burnt first in turbine (like a jet engine) and the flue gases (at about 600 degrees C) is used to boil water to power a normal steam driven turbine. An open cycle generator only uses gas for the first bit and exhausts very hot waste gases into the air.
The open cycle plants are also called peaking plants as they can be brought on line quickly when the wholesale price of electricity is high. Combined cycle plants take time to start up (to make sure all the bits of the plant heat up together up to their operating temperature).
Gas can also be burnt directly in a plant to boil water similar to coal, but this is not a very good substitute as export gas prices are about $12 a gigawatt, while current contracts of coal are about $1 a gigawatt for electricity generation – incidentally, the export cost of coal is currently $5 a gigawatt and when the current contracts for coal run out, they will be renewed at the new, higher price and therefore contributing far more to the increase in electricity prices in the future than the tax on carbon would.
Gas can become very inefficient if it has to be compressed (liquefied) for transportation where about 10% of the energy of the gas is used to compress it.
I also note that people are talking about fraking shale for gas. I don’t think Australia is doing that. Australian companies are looking at Coal Seam gas, which is a lot softer than shale and does not require the destructive pressures needed to crack shale.
Actually, fracking is used in some locations in Aus. and shale gas mining is happening right now in SA. google it.
But even without the fracking, aside from the massive leaking and venting of hydrocarbons that CSG extraction and transportation involves, the coal seam produced water naturally contains a nasty array of things that should stay deep underground. These not only include heavy metals (cadmium, arsenic, cyanide, mercury, lead & nickel to name a few) and radionuclides, but also BTEX chemicals and other hydrocarbons, as well as dissolved salts and minerals. So even if they dont frack the wells, they still have to drill them & many of the drilling fluids & additives themselves are very bad. I do not know anyone who would choose to add detergent, ethylene glycol or a biocide to their drinking water! These are commonly used agents in the drilling process.
Coal seam gas is not clean by any stretch of the imagination, not even comparing it to coal because another fossil fuel is not a stepping stone to renewables, it does nothing to fix the problem of global warming, it just continues to make it worse!
Mining companies are grabbing whats left of the fossils for quick and dirty financial gain, they’re obv. not out to save the world, thats crazy thinking.
The ever-reliable (and thus despised and dismissed by the climate delusional brigade) RealClimate blog has an article on fracking concerning this very topic.
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