Joint letter in support of Australian biomethane market development

Published Tue 09 Jun 2020

An Open Letter to the Commonwealth Government

One promising bioenergy opportunity that could play a significant role in global decarbonisation efforts is the injection of biomethane into gas distribution networks. Biomethane upgrading is well established in Europe and so Australia has the opportunity to leapfrog and deploy this at scale and low cost. It provides a solution to a number of current energy market decarbonisation challenges:

  1. Variable renewable electricity: With the continued increase in variable renewable electricity, complementary reliable and flexible resources are becoming more important. Biomethane in the gas grid connected to gas power plants can fulfill this need and start scaling up now.
  2. Heavy industry: This sector is harder to decarbonise due to the process inputs and high quality heat required. Biomethane can be delivered through existing connections to existing equipment, enabling effective decarbonisation.
  3. Heavy vehicles: Due to high utilisation and carrying capacity requirements, heavy haulage doesn’t lend itself to battery electric vehicles. BioCNG delivered through the gas network can start cutting emissions from this class of vehicles. 
  4. Domestic gas supply: Residential heating requirements often coincide with the ‘duck curve’ peak making electrification challenging. Biomethane uses existing networks and appliances to enable customers to decarbonise this energy.

A landmark report commissioned by Bioenergy Australia on the availability of biogas in Australia identified 371PJ of available energy, which is enough to decarbonise industrial, commercial and residential gas users currently supplied by distributed gas networks across Australia. 

We are confident that, with the right policy settings, Australia can attract the necessary investment to deliver a cost-effective, zero-emissions energy system that will create new jobs and new industries. To achieve this we are calling on governments and relevant agencies to work with us to:

  • further identify and raise awareness of the bioenergy resources that are available for development at a Federal, State/Territory and regional level;
  • unlock seed funding from government (federal, state and territory) and private investment to showcase, activate and de-risk the biomethane market across Australia including regional areas and Special Activation Precincts; and
  • build market confidence, scale and growth through:
    • supporting a national certification of biomethane as a renewable net zero emissions energy source;
    • recognising biomethane injection to gas networks as a net zero emissions energy source, including through the Emissions Reduction Fund;
    • establishing a market mechanism (such as a feed-in tariff or quantity target) to drive penetration of renewable gas (including hydrogen and biomethane) in the gas network, as has occurred for renewable electricity; 
    • enabling private project and market development with secure long-term government offtake agreements for public transport applications (for eg, BioCNG buses);
    • strengthening incentives to divert organic waste from landfill; and,
    • creating a bioenergy sector and building local capability and expertise to drive further innovation as well as export knowledge and capability across our region.

There is a ready market for biomethane products. Creating this policy environment will enable current gas users, such as Interface Carpets for example, to quickly and cost-effectively achieve net zero emissions now, while also scaling an Australian biomethane market to play a significant role in decarbonising the gas supply system over the next decade and beyond.

We invite you to contact us to speak about any of the above in further detail. We also welcome the opportunity to participate in consultation or to provide subject matter and industry experts as required. Please send through your requirements to Georgina Greenland via georgina@bioenergyaustralia.org.au.

We look forward to continuing to engage in the development of the National Bioenergy Roadmap and its implementation, as well as other complementary policy development processes at the federal, state and territory level. 


Yours sincerely,

 
Shahana McKenzie, CEO Bioenergy Australia

On behalf of the supporting organisations below: