No quick fix for Victoria’s gas woes

Energy policy is currently one of the hottest topics.

The below article by The Australian’s Matt Chambers continues to highlight the current opportunity for solid fuel products in the Victorian market.

Chambers highlights the challenge in responding to the shortage, noting there’s no quick fix for Victoria’s gas woes.

For decades, Victoria was the largest producer of gas on the east coast. Queensland now carries that mantle. So, how did we reach this point?

The gas industry has changed significantly in recent years. In a nutshell:

Demand is up

On the demand side, the completion of several large export-oriented projects has seen a surge in gas leaving the domestic market bound for customers across Asia.

On the local front, the demand for gas-fired electricity has increased due to greater reliance on intermittent wind and solar and the closure of base-load coal-fired power generators.

Unlike wind, solar and base-load coal (or nuclear), gas-fired electricity generation is dispatchable; able to ramp up or down on relatively short notice, making it an increasingly essential part of maintaining a reliable power supply.

Supply is down

Bans on gas development have resulted in no new supplies coming on line in recent years. Lifting those bans, as Chambers highlights, will not see new gas supply for several years due to the lead time of such projects.

Our opportunity

The greater demand and tighter supply of gas has driven up both gas and electricity prices, creating a reliability and affordability crisis for businesses and households.

The pain is felt more so by Victorian businesses that need to generate large volumes of ‘utility’ heat; businesses like dairy processors, timber dryers, abattoirs and greenhouse operators. Businesses that switched from brown coal briquettes to gas several years ago, are now struggling to remain competitive in the face of high gas prices. Some Victorian and Tasmanian businesses have resorted to importing black coal from New South Wales and Queensland at a cost of between $200 and $400 a tonne.

This has presented an opportunity for ECT to provide a solid fuel alternative to gas from our Coldry R&D facility north west of Melbourne.

We’re currently in the process of upgrading our pilot plant to deliver research capability in support of our project in India. These upgrades will deliver higher volumes of up to 30,000 tonnes of Coldry output per annum, which we intend to make available to local Victorian businesses. Many businesses that switched from briquettes to gas still have their old solid fuel boilers. We’ve spent the past few months working with a large consumer to recommission their boiler, tune and optimise it for Coldry.

This has also generated a number of enquiries from a range of industries, prompting us to embark on a feasibility study for the establishment of a dedicated large scale Coldry demonstration plant to supply between 100,000 and 170,000 tonnes per annum of solid fuel to Victorian businesses, providing energy diversification, reliability and affordability.

 

 

No quick fix for Victoria’s gas woes

The Australian | Mat Chambers | 29 Sept 2017

Even if Victoria’s Labor government lifted its ban on all onshore gas drilling, gas reserves would need to be confirmed by more wells and any resulting commercial supplies would probably be at least two years away.

Source: No quick fix for Victoria’s gas woes ($)