Samantha McCulloch discusses AEMO warnings, Future Gas Strategy and Australian Energy Producers Conference & Exhibition opening.
LAURA JAYES: Welcome back. The Australian Energy Market Operator has warned that we'll need to dig into our emergency supplies to prevent blackouts and power shortages on the east coast this summer. That is the risk because there are delays in new transmission lines and renewable projects are being blamed for the forecast.
So is this putting pressure on Labor and its energy plan? Joining me now is the Australian Energy Producer Chief Executive Samantha McCulloch, Sam, good to see you. Does any of this come as a surprise to you?
SAMANTHA MCCULLOCH: Good morning, Laura. No, this is the latest in another long list of warnings about unreliable electricity supply and the need for more investment in gas. Gas is playing such a critical role in terms of helping to back up renewables in power generation, supporting that shift away from coal. But, you know, AEMO, the ACCC and others have been warning of looming shortfalls and the need for more investment.
LJ: Well, with gas, we saw the Government release its gas strategy last week and essentially said it was needed until 2050 and beyond. Does that give you some comfort?
SM: Laura, this is absolutely the case. This is what we've been saying for some time. All of the analysis points to this long-term critical role for gas in our energy mix to 2050 and beyond gas is so critical in terms of supporting the transition. We need it for a reliable power supply, we need it to fuel our manufacturing sector, including those new opportunities that the Government's talking about around critical minerals processing and our industry is also playing a key role in terms of supporting other technologies, the new lower carbon fuels like carbon capture and storage that are so key for the transition.
LJ: It's required for hydrogen as well, and that is central to the Government's Future Made in Australia strategy. So, Sam, is there a figure that you have or, you know, a number of projects that need to get up in the next couple of years in order to make our energy system more reliable?
SM: Well, what we've seen from AEMO and ACCC and others is repeated warnings of shortfalls, and that's particularly concentrated in Victoria, New South Wales, the southern East Coast states. These are jurisdictions that haven't been supporting their own new investment in new supply. In fact, they have bans and moratoriums on developing gas and now that's coming home to roost really in terms of some of the pressures that we're seeing on the gas system and the electricity system.
It's really important that those projects that are currently stuck in regulatory purgatory that need to move forward are able to navigate those approvals processes, that we can bring that new gas supply to market urgently. That was highlighted in the Future Gas Strategy. The Future Gas Strategy identified an immediate action actually to fix the offshore approvals system, but unfortunately last week we saw that process delayed.
LJ: Okay. So the Government's released its gas strategy told us how critical the gas sector is up until 2050 and beyond and how that might reshape itself, but in the meantime, there are regulations both State and Federal that make it really hard for these projects to be viable. Is that putting it in a bit of a nutshell?
SM: Well, we've seen 12 to 18 months of approvals uncertainty, particularly in the offshore space. Some of these projects have been waiting for, you know, up to two years for their approvals and we just simply can't have that situation when the Government and others are calling for urgent new gas supply to meet that demand for households, for manufacturing and other uses.
LJ: That I imagine is going to be the feature of your major summit here in Perth today.
SM: Well, that's right, we're just about to get underway at the Australian Energy Producers Conference and Exhibition. This a fantastic opportunity for the industry to come together to share technology and innovation to discuss those issues that are important for our industry, but also for the energy transition. We're expecting more than 2000 delegates through the doors over the next three days, so it's a really great atmosphere here.
LJ: Sam, thanks so much. We'll see you soon.
SM: Thanks, Laura.
