2 weeks Ago By Adam Morton
T he big news on Monday morning was that the story splashed across the front of News Corp’s biggest-selling tabloid newspapers wasn’t news at all. It was an advertorial paid for by a fossil fuel industry. Not that readers glancing at page one of the Daily Telegraph, Herald Sun, Courier-Mail or Adelaide Advertiser were let in on this secret.
Instead, they were sold a lie – that the story was straight news coverage, in some cases described as an “exclusive” or a “special report”, on how (in the words of the Courier-Mail) Australia must “step on the gas” as it was the “only way to avoid higher bills, blackouts”. Only readers who flicked inside to an identical double-page spread run across the News Corp stable on the importance of gas were let in on the truth – that it was an advertising feature “proudly sponsored” by the gas infrastructure business APA Group and the gas companies Tamboran, Santos and Jemena. Those who read the main piece online saw no disclosure at all.
The main news story in the double-page spread ran under the headline “Only gas can save us now”. It warned that “households face being plunged into darkness – while paying even more for power – without action on Australia’s gas shortage”. The second paragraph was particularly unsubtle, saying industry leaders were “eager to tackle the looming deficit, but to have any hope of success they say that politicians and regulators must end lengthy project approval delays”.
In other words: please let us extract more gas. The argument was backed by quotes from the bosses of Woodside, Santos, APA and oil and gas lobby group the Australian Energy Producers, which until a recent marketing shift was known as the Australian Petroleum Production and Exploration Association. The climate change and energy minister, Chris Bowen, was approached for his view – a spokesperson responded on his behalf that an extra 600 petajoules of gas had been secured for the east coast – but otherwise no other opinions were sought.
Sign up for Guardian Australia’s breaking news email There were secondary pieces on how high electricity prices are affecting businesses that produce groceries and an opinion piece by ex-foreign minister Alexander Downer – not, it should be said, a noted energy expert. Neither acknowledged what analysts have said repeatedly: that the substantial jump in energy prices over the past couple of years was mainly due to Russia’s invasion of Ukraine pushing up fossil fuel prices, not solar and wind. There is no gas shortage in Australia Let’s consider the claims in the main piece.
Much of it hangs on a report by the Australian Competition and Consumer Commission (ACCC) in July that found that the Australian east coast faces potential gas shortfalls by 2027 , and in some states 2026, unless there are new sources of supply. The ACCC said southern states relied heavily on gas from Queensland producers during the winter months, when use of the fossil fuel is at its peak. This was in part due to gasfields in Bass Strait being nearly exhausted.
This is a genuine issue. Australian businesses and households use gas, and there will be significant problems and hardship if there is not enough made available while they continue to rely on it. But from there things get more complicated.
Not everyone with expertise agrees with the industry view that the answer is more extraction alone. Let’s consider some facts not included in the gas industry-sponsored News Corp advertorial spread. Gas is basically methane – a potent fossil fuel that plays a significant role in driving the climate crisis.
More than 20% of Australia’s greenhouse gas emissions come from extracting and burning it. If Australia’s leaders are serious about addressing the climate crisis – as the gas industry and major political parties say they are – logic tells us that its use needs to be limited where possible. For obvious reasons, it can’t just be cut off before the country is ready.
Failure to supply enough gas to meet demand would probably reduce support for the energy transition and lead to a backlash and higher emissions in the long run. But the public deserves honesty about what the goal is and what the options are. Another fact about gas: we have far, far more of it than News Corp or the industry lets on.
There is no gas shortage in Australia. More than 70% of what is extracted is turned into liquefied natural gas (LNG) and exported. Factor in the gas used by the export industry within Australia and that figure leaps to about 80%.
Australian governments have released gas basins to companies and claimed relatively little back in return for the gift of these resources. The companies have done what companies do – sell the product for maximum profits, in this case mostly overseas. This has been a problem because, unlike Western Australia, the east coast has not required that a percentage of gas be set aside for domestic use.
The result? Local gas prices – which were once cheap – increased sharply as the international market set the going rate. And regular talk of gas shortages. The Albanese government has made some steps to address these problems, including introducing a temporary price cap.
It led to a double-digit price fall, but Australians have still been paying at least three times what was considered normal. Unpicking these problems is not easy. Contracts are in place for some of it.
But climate change is a crisis, as the government has said, and how and where Australian gas is used during a crisis is a political choice. Supply threat from ageing coal plants Finally, let’s consider News Corp’s endorsement of industry claims that more gas can help avoid higher bills and blackouts. This is nonsense, basically.
On bills, for the reasons outlined above, gas is the most expensive form of electricity in the national grid . It is used in “peaking” generators that can be turned on and off quickly at times of high demand – for example, during a heatwave when people turn on air-conditioners. Using more of it would increase bills, not cut them.
The industry argues more supply will help bring down prices. Some experts say this is unlikely to be the case with gas, and that any change would be marginal, because the international market remains the price-setter and the cheap gas resources in Australia have largely already been tapped . New reservoirs are harder to reach and often require more expensive extraction and transportation methods.
This is part of what is fuelling the campaign for support to help households go electric and get off using gas for cooking and heating – it is both good for the climate and, depending on how upfront costs are addressed, could help reduce cost-of-living pressures . On blackouts, the biggest threat to supply during last week’s heatwaves were outages at ageing coal plants . The Australian Energy Market Operator (Aemo) says the best way to address that is to rapidly install more renewable energy and batteries.
Aemo says Australia will need more gas-fired capacity as coal closes and pushes towards running on 90% renewable energy, but will not necessarily need to burn more gas in the medium term. Peaking gas plants will provide a backup supply, or “strategic reserve” , called on when cheaper and cleaner options – solar, wind, hydro, a much larger supply of batteries and a better transmission grid – are not enough to ensure supply. There is one other gas constituency not mentioned so far in what News Corp has billed as a “week-long series explaining the critical importance of stepping on the gas to head off a crisis” – industrial users that rely on it for high-temperature industrial practices and don’t yet have a viable alternative.
But let’s put this in perspective. According to the Grattan Institute, about two-thirds of the gas used in manufacturing is consumed at just 15 facilities that together employ about 10,000 people . They use only a fraction of the gas that Australia draws from the ground and could be supported while gas use is cut elsewhere.
Obviously, none of this is likely to appear in the News Corp papers while the gas industry is buying the splash. Equally obviously, its readers deserve to be told some basic facts. We’ll learn a little more in the days ahead about how much respect the company has for the public – though I expect we already know.
Adam Morton is Guardian Australia’s climate and environment editor.
