INDUSTRY has given a tentative thumbs-up to Energy Minister Peter Collier's report into the state's long-term energy security to help guard against potential major supply disruptions.
INDUSTRY has given a tentative thumbs-up to Energy Minister Peter Collier's report into the state's long-term energy security to help guard against potential major supply disruptions.
But while the report has recommended several commonsense measures to improve the reliability of gas and energy supplies, it has left a number of questions unanswered and no clear timetable for implementation.
Key recommendations include increasing the number of gas-fired power plants able to run on liquid fuels when gas supplies are unavailable, and storing emergency supplies of natural gas in depleted reservoirs close to Perth.
With gas accounting for 60 per cent of all fuel used for electricity generation on the state's main power grid, measures to respond to a Varanus Island-scale disruption are the centrepiece of the report.
The report said retrofitting the Cockburn and NewGen Kwinana gas fired power stations to run on liquid fuels would cost around $9 million a year, and add only $4-$5 to the average annual residential electricity bill. It would also require the power plants to have adequate fuel stored for use in such situations.
Additionally, storing more gas for emergency use in depleted gasfields, such as the existing Mondarra storage facility near Dongara, would cost about $50.8 million a year, or $25 for each residential customer.
That would provide up to 100 terajoules of gas a day, equivalent to about 10 per cent of the state's average daily usage, but would require a six-fold increase in the capacity of Mondarra, the only such storage facility in the region.
Mr Collier said the storage option would enable the state to ride out a significant supply disruption for up to three months.
But he was unable to provide key details of how such a plan would be implemented, including who would actually buy and own the gas destined for storage.
“The recommendations (on storage) are but that, they are recommendations," Mr Collier said. "What we need to do now as a government is go back and ascertain whether it's viable and how we are going to produce it."
With debate raging over the availability of additional large-scale gas supplies, Mr Collier was also unable to identify where the gas for storage would come from, but said the government was focusing on measures to encourage the development of new supplies.
“Gas supply and development of new fields is a top priority of this government," he said.
The report also ruled out the construction of a 500tj/day LNG receiving and storage terminal at Kwinana as too costly, although it might be worthy of further consideration by gas market participants.
