Fuelling the climate crisis: why LNG is no miracle cure for Australia’s coal addiction

Extract from The Guardian

Energy

Angus Taylor has claimed liquified natural gas is cutting global greenhouse pollution by 150 million tonnes a year. But does his claim stand up?

Adam Morton

@adamlmorton

Sun 7 Jul 2019 08.00 AEST Last modified on Sun 7 Jul 2019 11.27 AEST

The idea the export gas industry is good for the planet – and Australia deserves credit for it – appears set for a serious workout in this parliament. Photograph: Ray Strange/AAP

On Thursday, Australia’s emissions reduction minister, Angus Taylor, told parliament the country’s thriving liquified natural gas (LNG) trade – a fossil fuel industry – was cutting global greenhouse pollution by 150 million tonnes a year.
It was no small claim: equivalent to more than a quarter of what Australia emits every year.
Two days earlier, an analysis by US-based researchers and anti-fossil fuel advocates the Global Energy Monitor found if all US$1.3tn worth of LNG developments planned across the globe went ahead they would do at least as much to drive the world into climate catastrophe as new coal investments, possibly more. Australia is a significant player in this drive, with $38bn in investments on the books – fourth behind only the US, Canada or Russia.

As the prime minister, Scott Morrison, concedes, Australia’s emissions are rising – they have been since 2015. The government’s analysis blames much of that on LNG. Yet the idea the export gas industry is good for the planet – and Australia deserves credit for it – appears set for a serious workout in this parliament.
Some uncontested facts: the Australian industry has surged across the Top End in the past five years to a point where the country rivals Qatar as the world’s biggest LNG exporter. Seven multi-decade developments have started production at Gladstone, Queensland, near Darwin and especially in northern Western Australia. Export earnings from LNG increased 61% in two years to almost $50bn, putting it behind only iron ore in value. The industry employs thousands of people.
LNG developments often involve remarkable feats of engineering. For the giant Ichthys project in the NT, gas is extracted from an offshore well in the Browse Basin, between Australia and Indonesia, and sent 890km via subsea pipe to Darwin. There, the gas is cooled into liquid form. It is then shipped to Asia, converted back to gas and burned to generate electricity and heat and used in industrial processes, including making plastic.

It is an incredibly energy intensive process and produces a large amount of heat-trapping emissions. Berlin-based researchers at Climate Analytics found the growth in LNG pollution in Australia between 2015 and 2020 would effectively wipe out that avoided through the 23% national renewable energy target.

LNG emissions in Australia reach the atmosphere as methane, which leaks from wells and pipes as it is extracted and transported, and as carbon dioxide when gas is processed and burned. LNG emissions in Australia are significant but dwarfed by what is released when the gas is decompressed and burned in Japan, China and Korea.
Taylor says these emissions are good because LNG is taking the place of coal and there are fewer emissions than there would otherwise be. He is yet to address the inconsistency in the government promoting gas exports as good for the climate while also enthusiastically backing coal exports including Adani’s controversial Carmichael mine.
The 150m tonnes a year Taylor cites comes from a back-of-the-envelope calculation by the environment department – the difference between burning all the LNG Australia exported last year and burning an equivalent amount of black coal.
No evidence has been given that LNG is displacing coal to that extent but the figure was included as evidence in the department’s latest report on national emissions. Taylor then claimed Australia’s emissions “had the potential” to lower global emissions by that amount; by the time parliament resumed it had become a fact. The Australian Petroleum Production and Exploration Association (Appea) has made similar claims.
Neither Taylor’s office nor Appea answered a question from Guardian Australia on what basis they assumed LNG was displacing coal.

Based on the most recent advice from the government’s office of the chief economist, there doesn’t appear to be one. In a quarterly commodities report released on 1 July, the office says Japan – Australia’s biggest LNG market – has started reopening the large nuclear power fleet closed after the Fukushima disaster.
The office says gas in Japan is expected to face increasing competition from nuclear and renewable power. Where it is preferred to these sources LNG is increasing global emissions. This marries up with a trend illustrated by the International Energy Agency: gas and coal use jumped after Fukushima, increasing global emissions. Now nuclear is starting to return.
The picture is a little less clear in China, the second biggest market for Australian LNG. It wants the share of gas in the energy mix to rise from 7% to 15% by 2030, in part to help reduce air pollution caused by coal. It is also increasing its use of nuclear, solar and wind.
Tony Wood, energy program director at thinktank the Grattan Institute, is annoyed by claims that gas is displacing coal. “It is a counterfactual – unprovable – but is speculative at best, highly questionable at worst.”
Wood says there may be some instances where gas is preferred to coal but it is likely to also be competing with nuclear and gas from Qatar, which – due to fugitive methane emissions from wells on the West Australian North West Shelf and some Queensland coal-seam gas fields – could be cleaner than that from Australia.
He objects to suggestions Australia deserves credit for its LNG exports while emissions are increasing at home.

Frank Jotzo, an economist and professor at the ANU Crawford School of Public Policy, says: “What is certain is the expansion of the LNG industry is holding up the transition to zero carbon fuels.”
He says any conversation about LNG emissions come with a significant caveat: we still do not have a good estimate of global fugitive emissions.
Gas has about half the CO₂ emissions of coal when burned but methane leaked during processing – while lasting in the atmosphere only about 12 years – is so potent it has a warming power about 28 times greater than CO₂ when calculated over a century.
A recent study found the level of atmospheric methane has increased significantly since 2007 after a relative flat period. Scientists say they are unsure why.
But they are clear that methane emissions need to be reduced. The Intergovernmental Panel on Climate Change says they need to be cut by 35% between 2010 and 2050 under a path that gives the world a chance of limiting global heating to 1.5C.
Despite this, a dramatic expansion of the LNG is proposed across the globe, mostly in North America but also Australia.
According to the Global Energy Monitor, these plans put the LNG industry on a collision course with the goals of the Paris agreement. Ted Nace, the group’s executive director, says there is still time for a moratorium on new LNG developments. And he says the industry may yet face a wake-up call as the falling cost of renewable energy puts expensive fossil fuel investments at risk of becoming uncompetitive stranded assets.

A paper in the journal Nature last week suggests something will have to give on LNG plans if the world is to stop the climate crisis pushing into more dangerous territory. Researchers from California and Beijing calculated if all existing fossil fuel infrastructure across the planet was allowed to run for its expected lifespan that alone would be enough to push global heating beyond 1.5C.