Gas networks under pressure


Hey Reader, in today's edition:

  • 'Renewable gas' gap
  • System security warning
  • Waning volatility

SA gas network steps up stranded assets plea

The arm-wrestling between Australia’s energy regulator and gas network owners looks set to reach new heights, as asset owners concede ‘renewable gas’ isn’t the panacea they have been suggesting.

Australian Gas Networks continues to promote renewable gas on its website, and is defending a greenwashing action by the competition regulator for claiming the gas it distributes to households on its network will be renewable within a generation.

But its latest revenue proposal to the AER includes $70 million of accelerated depreciation which the company says is required to “address the increasing uncertainty over the role our network will play in a low carbon energy future” because of “a lack of policy support for renewable gas, observed and increasing declines in gas volumes [and] no renewable gas available to customers at any meaningful scale”.

The dance between the regulator and the gas network owners comes amid a wider debate on whether regulatory regimes that determine financial returns for monopoly network assets in electricity and gas are fit-for-purpose as the transition to clean energy and all-electric homes and businesses accelerates.

National approach key to smoothing renewables transition

Syncons are not the panacea and Australia should establish a national approach to electrification, UNSW & NSW Decarbonisation Innovation Hub researchers have argued in a new white paper that outlines key regulatory issues and calls for an “immediate and detailed” study of how inverter-based and BESS resources behave during peak generation periods.

The new paper, entitled Securing Power Systems in the Renewable Revolution, notes the “parallel imperatives” pressuring Australia’s power system as pressure to rapidly decarbonise dovetails with the rapidly nearing end-of-life of Australia’s mainly coal-fired generation system.

With a rapid ramp-up of renewable generation and BESS capacity already delivering half of Australia’s energy and new capacity coming online every week, the authors note that without clear roles, risk allocation and accountability informed by deep technical expertise, there is a significant risk that system security services will not be delivered when and where they are needed.

Catch Up

Capital

Treasury is asking for feedback on improving product information standards for sustainable investment products, which have been identified in the government’s Sustainable Finance Roadmap as a priority for attracting capital. The goal of labelling is to help investors better understand investments’ sustainable credentials and to lend more credibility to product issuers’ claims that a financial product is sustainable. The consultation will run until March 13.

The share prices of the 21 ASX 200 utilities sector firms surged by 9.38% overall last week, outpacing all other industry sectors and helping the S&P/ASX 200 Index recover lost ground as it pushes back towards its October 21 all-time high of 9115.2. Strong earnings across the board drove double-digit share price growth from the likes of Origin Energy (ASX: ORG) and AGL Energy Ltd (ASX: AGL). (Motley Fool)

The number of high price events in the NEM dropped from 23 during the final quarter of 2024 to just 3 in the last three months of 2025, a new Australian Energy Regulator (AER) report has shown in a sign that the addition of renewables and BESS are translating into less pricing and supply volatility across the grid. Prices exceeded $5,000 per MWh for one 30-minute period on each of November 25, November 26, and December 19 – reflecting restricted access to rooftop solar or generating unit capacity, or network limitations preventing cheaper generation from getting to load centres.

Australia’s relatively slow embrace of decarbonisation could create barriers to exports as nimbler major trading partners embrace faster green transitions, CommBank’s (ASX:CBA) head of commodities and sustainability research Vivek Dhar has warned in a research note that says the NEM is failing to balance the three competing pressures of the ‘energy trilemma’ – affordability, reliability and decarbonisation. Australia ranked 22nd globally on the WEC’s World Energy Trilemma Index but has fallen to 28th as reliability and affordability have worsened. Dhar said, arguing that the energy sector “must now find a way to overcome the challenge”.


Energy systems

Australia’s 58 operational utility-scale battery energy storage systems (BESS) set a new battery discharge record in the NEM this week, Open Electricity data has shown. Higher than average contributions during morning and night peak periods saw 12.98GWh discharged across the network on Tuesday 10 February, handily beating the previous record of 11.16GWh set just a week earlier. (Energy Magazine)


Projects

Queensland’s second “mega battery”, a two-hour 300MW facility at the Tarong power station near Nanango, has commenced commercial operations. It’s the second BESS to go live in the Sunshine State within a fortnight and operator Stanwell’s first wholly owned battery – and has boosted overall capacity of the site to 2.1GW. Stanwell’s overall battery firming portfolio includes 2.8GW of total capacity, with another BESS under construction under construction and a capacity purchase agreement with Quinbrook’s Supernode Stage 3 BESS at Brendale.

Two years after the concept was floated, EnergyAustralia’s Hallett, SA BESS has reached its Financial Investment Decision and is moving into the delivery phase, the company announced. EnergyAustralia, NHOA Energy, and Enerven are partnering to build the 50MW/250MWh BESS adjacent to the existing Hallett gas-fired power station. The site will begin construction in coming weeks and is expected to commence commercial operations in mid 2027, with planning approval already in place to later expand the site to 200MW.


Policy

Australia should introduce a “border carbon adjustment” for a “select group of commodities” including cement and clinker, the final report of the Carbon Leakage Review has recommended alongside consideration of a similar adjustment for lime; hydrogen; ammonia and derivatives; steel and iron; and glass. Recommendations for the new carbon tax also include shaping the adjustment to “mirror domestic emissions policy settings”, with liabilities assessed based on scope 1 emissions above Safeguard Mechanism baselines.

The federal government granted a 7-year extension to the Middlemount Coal Mine that will allow the extraction of 112 million additional tonnes of coal, drawing swift and fierce blowback from the Greens – who called the move “indefensible climate vandalism… [that] ignores expert advice” – and the Climate Council, whose analyst Ben McLeod argued the Albanese Government “cannot claim leadership while it waves through new fossil fuel approvals.”

VicGrid extended the consultation period on draft renewable energy zones (REZ) in the state until March 15, citing the “devastating impact” recent bushfires have had on many communities and flagging an upcoming series of rescheduled community webinars and events.


Regulation

Victoria’s Essential Services Commission (ESC) is seeking feedback on an application by Flipped Energy Australia Pty Ltd, which has applied for a license to sell electricity under s18 of the state Electricity Industry Act 2000 (Vic). Submissions are open until March 16.

NOPSEMA has shut down operations at WA’s Wandoo oil field, 80km off the Pilbara coast, months after a small December oil spill that occurred just weeks after the agency identified “systemic failures” in owner Vermillion Oil & Gas Australia management and concluded that these “may have contributed to” the spill – the fourth minor spill in five years. NOPSEMA concluding that Vermillion’s environmental management system “is not fit for purpose”, raising questions over Vermillion’s application to drill seven more exploratory wells starting this year or next. (Boiling Cold)


Technology

WA mining giant Fortescue has launched trials of two battery-electric locomotives in the state’s Pilbara region, putting the decarbonised engines on the rails just months after BHP began its own tests of the trains. Powered by 14.5MWh batteries – and charged using regenerative braking and a Fortescue network of solar panels said to be adding over 3,000 new solar panels per day – each locomotive will save 1 million litres of diesel annually, a key step in the company’s push to reach net zero by 2030. (ABC)


Research

QUT’s new Energy Transition Centre (ETC) has been designed to catalyse collaboration between researchers, industry, government, and community partners – encouraging collaboration on research and commercialisation “across the full energy ecosystem”. Focus areas will include critical minerals and battery manufacturing to digital energy systems, policy reform and the resilience of Australia’s energy grids. “Australia has the opportunity to lead the world in sustainable energy systems,” co-director Professor Sara Couperthwaite said, but it requires deep collaboration across minerals, manufacturing, digital technologies, and policy.”

What's On

February 17
Briefing: Innovative housing solutions alongside the renewable energy roll-out

Bart Sykes, Regional Economic Development Manager at Squadron Energy; Vincent Dwyer, Co-Founder and CEO at Energy Estate; and Jess Adler, Corporate & Business Services Manager at WImmera Southern Mallee Development will speak at this RE-Alliance webinar.


February 19
Running a Digital Grid: The Next Challenge in the Energy Transition

Dani Alexander, CEO of the UNSW Energy Institute will moderate this webinar from The Energy, also featuring Emma Fagan, General Manager for Policy and Regulatory Affairs with Akaysha Energy; and Antti Harjula, Technical Director of Power System Performance and Connections with Powerlink Queensland. Register here to attend, or to view the recording later if you can’t make it on the day.


February 24
Energy Security NSW

AEMC Commissioner & Reliability Panel Chair Rainer Korte will keynote this CEDA event in Sydney also featuring ASL CEO Nevenka Codevelle, Neoen Australia Head of Development Nathan Ling, Transgrid EGM of Network Jason Krstanoski and Australian Gas InfrastructureGroup EGM Customer & Strategy Cathryn McArthur.


February 26
Energy Security Queensland

AEMC Commissioner Rainer Korte will keynote this CEDA event in Brisbane, also featuring Energy Queensland EGM Regulation, Risk and Strategy Benn Barr; Powerlink EGM, Operations Stewart Bell; APA Group Operations Executive Petrea Bradford; and CleanCo Queensland EGM Asset Operations Rimu Nelson.


February 27
National Energy Transition Research Summit

Climate Change Authority CEO Kath Rowley will speak at this ACOLA event in Canberra, alongside Net Zero Economy Authority CEO David Shankey and Australia’s Chief Scientist Tony Haymet.


March 3
Clean Energy Investor Group Conference

Victorian Energy Minister Lily D’Ambrosio will headline this Melbourne event also featuring ENGIE Australia Managing Director of Renewables and Batteries Laura Caspari, SEC Vic CEO Chris Miller, Queensland Renewable Energy Council CEO Katie-Anne Mulder, VicGrid CEO Alistair Parker, and Squadron Energy CEO Rob Wheals.


March 4-5
Energy Consumers Australia Foresighting Forum

Luis Gonzalez, Chief Data and AI Officer at Aboitz Power, Robert Gross, Director of the UK Energy Research Centre, and Harriet Thomson, Associate Director at the Glasgow Centre for Sustainable Energy will keynote this Sydney event. Industry speakers include EnergyAustralia CEO Mark Collette, Essential Energy CEO John Cleland, and Tim Jarratt, Group Executive, Market Development & Strategy, Ausgrid.


March 10
Orchestrating Consumer Energy Resources to Benefit Customers and Strengthen the Grid

AGL CEO Damien Nicks will keynote this Australian Energy Council event in Melbourne. Other speakers include AEMC Chair Anna Collyer and AEMO Executive General Manager, Policy & Corporate Affairs Violette Mouchaileh.

The Energy

The Energy is dedicated to covering the business of energy and in particular the people, capital, projects and emerging technology behind the energy transition.

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