Who Gives a Frack?

Coal Seam Gas said to Benefit Manufacturing in Victoria by Lowering Gas Prices.

There’s a lot of health concerns about CSG affecting water tables but with an abundance of resources, energy prices being so high, big players lobbying and the need to create jobs can you blame people for wanting the industry in Victoria.

The Victorian government have delayed their decision on onshore gas development until mid-2015, ignoring recommendations by the Gas Market Taskforce. In the meantime, there is a halt on new CSG exploration licences and a hold on approvals for hydraulic fracturing until the National Harmonised Framework for CSG which is being developed under the Standing Council on Energy and Resources (SCER) is approved, and Victoria’s response determined.

So what about manufacturers and consumers who are paying rising energy prices? Energy network operators pretty much charge whatever they want, raising the costs year on year. Consumers can install solar or hybrid solar/wind systems to lower their energy costs however, for manufacturers who use 10’s to 100’s of gigawatts and terrawatts of power, alternative energy is not an alternative.

Tony Abbott wants more coal plants, explaining that it’s the cheapest resource and will lower energy pricing and therefore make Australia more competitive. Others say by 2040, a renewable energy grid can handle the load, but with over 50% of your bill coming from network operators, with 5 taxes (GST, LRET, SREC, VEET and Carbon Tax), and then the retailers taking their cut, where’s the cost reduction going to come from and how much can it actually be lowered by?

I don’t believe CSG will lower energy pricing by that much, it’s just another argument to get the projects approved. It will create more jobs and prosperity for businesses who supply the infrastructure and other goods and services for these plants.

It seems manufacturing needs three things; a lower dollar, lower utility costs and more support from government in way of funding, subsidies and grants in one way or another, whether it be at the RnD level, grants for startups and innovators or helping keep an industry more competitive in a global market.

 

 

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