Calls for state to secure energy supply

Business News
Thursday 12/6/2008 Page: 3

INDUSTRY has called on the state government to encourage further exploration and development of new energy sources, including coal, gas and uranium, following the second major incident involving a reduction in gas supply in less than six months.

The explosion at Apache Energy Ltd's Varanus Island gas facility last week, which resulted in a third of the state's gas supply being shut off, exposed the vulnerability of Western Australia's energy system and underlined the need for a comprehensive energy policy, according to the Chamber of Commerce and Industry.

CCIWA chief executive James Pearson said the state needed to diversify its energy mix and look at the feasible energy options, including re-opening the debate on nuclear energy. "We need to make sure we make use of our abundant gas resources, we have abundant coal, and renewable energy technologies which might contribute towards the answer. We also think its time we had a sensible discussion about nuclear," he said.

Mr Pearson said the state government had put up numerous barriers to the development of new energy sources, including too much red tape and 'green' tape. "It takes too long to move from finding new energy sources to developing them and getting them to customers," he said. While it was too early to say what the total impact of the gas shortages would be on the WA economy, Mr Pearson said his members were telling him it was costing millions of dollars a day to keep their doors open.

Liberal leader Troy Buswell has also called for the implementation of a state energy plan, saying the government has failed to take a strategic approach to securing the state's energy supply. The opposition has released its policy proposal for a state energy plan, which provides for a domestic gas reservation policy, the provision of infrastructure, and the diversification of the energy mix. Industries such as mining, construction, building services, food processing, hospitality, and health have all been significantly affected by the gas shortage.

Apache says it could take a couple of months before limited supply can be returned. This isn't the first time that the state's industry has been exposed to major energy disruption. In January, a fault at the North West Shelf venture's Karratha gas plant shut the plant down for two days, affecting about 20 per cent of WA's energy generators.

Additional energy was obtained from various sources, including wind power from the South West and generators in Kalgoorlie, to avoid rolling black-outs. Domgas Alliance chairman Stuart Hohnen said the incidents showed the extent to which the state was reliant on two sources of gas supply and how heavily WA relied on gas for its energy needs. "Gas supplies more than half the primary energy. Gas has a central position in the energy economy and it's very important to major industry," he said.

With WA's current consumption of gas roughly 1,000 terajoules a day, Mr Hohnen said demand projections showed an additional 650TJ a day could be required in the market in the next five to six years, and a further 250TJ a day on top required to replace existing contributions.

The WA Sustainable Energy Association said the government should aggressively invest in a variety of renewable generation spread across rural WA, including additional wind farms, biomass and biogas production, and fast-track the development of the state's wave and geothermal resources.