11 Feb 2013

Can Sydney Green The Grid?

By Norman Thompson and Justin Field
The City of Sydney's trigas generator scheme is being built by Origin - Australia's largest coal seam gas producer. What happened to the transition to biogas, ask Norman Thompson and Justin Field

Read part one of Norman Thompson and Justin Field's story on Sydney's trigas scheme here

Sydney Council's Sustainable Sydney 2030 plan targets a 70 per cent reduction of greenhouse gas emissions from 2006 levels. At the centre of the plan is a trigeneration (trigen) network across the city that will burn gas to deliver electricity, heating and cooling to city buildings.

The aims of the plan are commendable and emission reductions on this scale are needed Australia wide. But the implementationvia a trigen network that will be built and maintained by Australia's largest coal seam gas company (CSG), Origin Energy, raises serious questions about its ability to achieve the emission reduction targets.

According to the City's Trigeneration Master Plan, council has "resolved that by 2030 renewable gases from waste and other ... sources will replace fossil fuel natural gas in the trigeneration systems". This means that until that time CSG, which currently makes up around 5 per cent of NSW supply, will be used to power the system.

The plan suggests the City has identified sufficient waste-derived renewable feed-stocks to generate and supply biogas to the trigen system, however it acknowledges the plans for moving to renewable gas are yet to be finalised.

In April 2012 Sydney Council signed an agreement (pdf) with Origin Energy's totally owned subsidiary Cogent Energy to begin building the trigen system. Under the agreement "Origin will be responsible for the ongoing operation and maintenance of the trigen plants".

Origin Energy has a 37.5 per cent stake in Australia Pacific LNG which is constructing a Liquified Natural Gas (LNG) plant at Gladstone in Queensland. Origin is responsible for construction and operation of the project's CSG fields.

Neither Origin nor Cogent have notable experience in biogas projects and Origin promotes itself as Australia's largest producer of coal seam gas.

Over the last 12 months, energy analysts have made clear their assessment that the construction of large gas export terminals in Gladstone will lead to the export of much of the available gas in production in the Eastern States and subsequently push up domestic prices. A recent Deloitte report (pdf) cited that "given the speed at which these projects are coming on line, supply constraints may mean ... gas may be directed out of the domestic market — presenting challenges for domestic supply and pushing up prices significantly."

For NSW, which continues to get around 95 per cent of its gas supply from conventional gas fields in South Australia, the export gas expansions in Queensland create a real risk of escalating prices and difficulties meeting local demand.

Adding to this pressure, Sydney's trigen scheme will consume 17 petajoules (PJ) per year representing an increase in state-wide gas consumption from current levels of nearly 12.5 per cent. NSW customers, including the City of Sydney's trigen customers, will have to pay more for electricity derived by gas or alternatively local gas production will need to expand rapidly to keep prices down.

For Origin, who is building and running the trigen plants and whose coal seam gas field development and export plans are contributing to reducing available local supply and pushing up costs — it seems a win win. But neither of these options seem positive for customers or the environment — increasing local gas production inevitably means promoting polluting and farm-destroying coal seam gas.

The Deloitte Report makes clear that proven reserves of conventional gas from the Cooper Basin in South Australia, NSW's current main source of gas, is declining and 80 per cent of proven gas reserves on the east coast are now CSG. In short, until the trigen scheme makes the transition to biogas, it will be burning more and more coal seam gas and will actually be helping to promote coal seam gas development to meet its demands.

Last week AGL was forced to voluntarily suspend assessment of its Camden Gas Project expansion plans due to community opposition. With AGL, APEX Energy and Dart Energy pushing to develop CSG fields across the Sydney basin and around Sydney's drinking water catchment, the City's trigen scheme has the potential to pit the council against the residents of greater Sydney.

Asked about concerns over the use of fossil gas to run the trigen system, City of Sydney Chief Executive Monica Barone said late last year, "our plan makes it clear that we want to move to renewable gas as soon as it becomes available. The infrastructure will have the capacity to do this and our contract with Cogent requires this".

This transition seems unlikely if not impossible.

Jonathan Prendergast of Prendergast Projects, who was a consultant to the City of Sydney on its plans, has since argued publicly that Australia needs to "green its gas grid" with substantial investment in biogas. But far from laying out a detailed plan of how Sydney could meet even its 17PJ gas demand, Prendergast presents a limited case study on Denmark's biogas industry and called for direct government and industry investment in expanding biogas production.

Beyond Zero Emissions (BZE) raised concerns about biogas availability in a submission (pdf) last year to the City's Draft Trigeneration Master Plan. It cites that for Sydney to meet its gas demand from biogas it would take around 10 per cent of Australia's total biomas availability based on CSIRO studies.

In an article in response to Prendergast, BZE Executive Director Matt Wright highlights that Denmark's renewable energy focus is large scale wind and that biogas is a fraction of renewable supply. In the last 10 years Denmark has increased its biogas supply only marginally from 3.6PJ to 4.2PJ even now only a quarter of the demand of the City of Sydney's trigen project. This analysis seriously undermines the City's claims about a biogas transition.

Added to all of these argument's, in November last year scientists from Southern Cross University reported for the first time research suggesting significant methane leakage from CSG fields in Queensland. This fits with earlier research from the US shale fields suggesting fugitive emissions from unconventional gas may make the carbon footprint of shale gas burnt for electricity worse for the climate than even coal.

The facts seem to be that the City of Sydney's trigen scheme is being developed by the largest coal seam gas company in Australia. It will run partly on CSG when it starts, by virtue of the current domestic gas supply in NSW and, given expected supply shortages on the East Coast due to massive demand from export plants in Queensland, it will promote increased production of coal seam gas for local use.

With CSG's climate credentials seriously weakened by fugitive emissions studies, the unavoidable use and promotion of CSG as a feedstock for the trigen scheme undermines the rationale for the entire project.

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Posted Monday, February 11, 2013 - 21:52

I'm increasingly perplexed why Sydney Council has taken this path. Is it only political? Do they think that encouraging coal seam gas in the days of rapidly rising gas prices is good for our residents and the Australian economy? Surely they don't believe this is going to help curb climate change.

Please, please, could Sydney Council keep all of us informed. I live in the Council area, and I never received valid information about this huge investment of our money to what?? Help the environment? Hardly. To make us look green and working to save the planet? Maybe, but it only appears to be looking good while harming all of us. Engage with us, Council. Tell us exactly what you are doing.

Posted Wednesday, February 13, 2013 - 10:44

There are 5 major reasons why those advocating gas-fired power within Sydney (some of them, like Sydney Lord Mayor Clover Moore, evidently very well-intentioned) are on the wrong track:

1. In a recently released statement, Bloomberg New Energy Finance (BNEF ) revealed that electricity from a wind farm can be produced at a cost of AU$80 per megawatt hour — compared to AU$143/MWh for a new coal plant and AU$116/MWh for a new gas plant — 44 per cent and 31 per cent less, respectively (see "Renewable energy now cheaper than new fossil fuels in Australia": http://about.bnef.com/2013/02/07/renewable-energy-now-cheaper-than-new-f... ) (I don't know the figures re cogeneration).

2. Gas burning as proposed in an urban area has been expertly predicted to increased nitrogen oxides (NOx) to unacceptable levels. Thus the DECC interim report states: “In the Sydney CBD and other urban canyons, uncontrolled emission of NOx from cogeneration could exceed health-based goals” (see: http://www.environment.nsw.gov.au/resources/air/inp09124.pdf ) .

3. Methane (CH4) (about 85% of natural gas) is 105 times worse than CO2 as a greenhouse gas (GHG) on a 20 year time frame and taking aerosol impacts into account. Methane leaks (3.3% in the US based on the latest US EPA data and as high as 7.9% for methane from “fracking” coal seams). Burning both coal and methane generates the GHG CO2 (as well as other pollutants) i.e. neither coal nor natural gas are not clean GHG-wise, they are both dirty. A 2.6 % leakage of CH4 yields the same greenhouse effect as burning the remaining 97.4% CH4. Using this information one can determine that gas burning for electricity can be much dirtier than coal burning greenhouse gas-wise (GHG-wise). While gas burning for power generates twice as much electrical energy per tonne of CO2 produced (MWh/tonne CO2) than coal burning and the health-adverse pollution from gas burning is lower than for coal burning, gas leakage in the system actually means that gas burning for power can be worse GHG-wise than coal burning (see “Gas is not clean energy”: https://sites.google.com/site/gasisnotcleanenergy/ ).

4. In 2009 the WBGU, which advises the German Government on climate change, estimated that fora 75% chance of avoiding a catastrophic 2C temperature rise, the World can emit no more than 600 bilikon tonnes CIO2 between 2010 an dzero emissions in 2050. The World's GHG pollution is so high that it is set to exceed 600 billion tonnes CO2-equivalent in about 5 years (see Gideon Polya, "Doha Climate Change Inaction. Only 5 years left to act": http://mwcnews.net/focus/analysis/23373-gideonpolya-climate-change.html ). We have to cease burning fossil fuels ASAP.

5. There is no excuse not to listen to the small number of scientists prepared to offer quantitative science-based opinions (however see Gideon Polya, “Current academic censorship and self-censorship in Australian universities”, Public University Journal, volume 1, Conference Supplement, “Transforming the Australia University”, Melbourne, 9-10 December 2001: http://pandora.nla.gov.au/pan/57092/20080218-1150/www.publicuni.org/jrnl... ). Indeed those failing to listen to such proffered advice should expect to be held personally responsible for such failure.

Peace is the only way but Silence kills and Silence is complicity.

Posted Wednesday, February 13, 2013 - 14:43

Jon Walter
The authors of this article claim the City’s trigeneraton network would drive up demand for natural gas and lead to increased demand for coal seam gas.

This is nonsense. Even at its full capacity in 2030, the City’s trigeneration network would only account for 3 per cent of projected demand for gas in NSW, or 1 per cent in the Eastern Gas Market, covering Qld, NSW, Vic and S.A by 2030. Regardless of whether this trigneration project went ahead or not, there would still be large-scale industrial, commercial and residential demand for gas.

The authors also question the City’s strategy to move from natural gas for its trigeneration network, to renewable fuels or biogases produced from garbage, sewage, crop and livestock wastes. This practise is happening widely in Europe, led by Germany, Austria, Denmark, Netherlands, Sweden and the UK. Even the National Grid in the USA is developing a renewable gas grid injection program in Massachusetts, New Hampshire, New York and Rhode Island.
For full details see this article: http://newmatilda.com/2013/02/13/city-sydney-defends-trigen-scheme

Posted Tuesday, February 26, 2013 - 23:38

The 20 page magazine I linked to in my article (http://www.e-pages.dk/energinet/258/1.) is not a limited study by the Biogas industry. Energinet DK are the publicly owned energy distribution enterprise. They are government owned. And it is the result of decades of research and trial projects.

The policy regarding Danish energy and biogas can be found here - http://www.ens.dk/da-DK/Politik/Dansk-klima-og-energi-politik/politiskea... - and includes funding for biogas projects that inject into the grid.

By my rough calcs, Biogas is used to produce energy worldwide more than both solar and wind energy combined, based on the 2010 Survey of Energy Resources by the World Energy Council, (Page 360). 10% of the renewables energy mix compared to 8% for solar and wind. Biomass and Hydro make up most of of the renewables energy mix.

Biogas is real. It is not made up, and certainly a part of our future renewable energy system. It can be stored, and used on demand. Very important for the reliability of our energy system.

Just like solar PV, suitable levels of investment will see its cost reduced over time. It also has other benefits such as reduced landfill, reduced nitrogen leakage into the ground and less sewerage into our oceans. Using biogas and distributed high efficient generation also reduces requirements for electricity network infrastructure (the reason of our recent high price increases). Wouldn't it be nice if not so many poles and wires were in our streets and national parks?

Please note that Matthew's article also contain many errors.

I could have provided this information if you called. I note that it is also very hard to find Allan's response on your website, but very easy to find your articles. Please make them all equally available.

Disclaimer: I have worked, as you noted, and I have noted in my original article, for the City of Sydney as a consultant.

Justin Field
Posted Friday, March 1, 2013 - 15:03

Thanks for the response Jonathon.

You are right that the 20 page magazine you linked to is not a limited study of the biogas industry - in fact it is not a study at all. It is a PR publication by a corporatised state entity charged with delivering on a political decision about energy supply.

Don't get me wrong, I am not against biogas and agree it will be a useful fuel that will divert waste but that doesn't take away from the fact that the plan to provide biogas to meet the needs of Sydney's trigen scheme doesn't yet exist. It also doesn't take away from the arguments that with efficiency and renewables that we could achieve the same reduction targets with no need for more burning of any type of gas and the air quality implications that have been rightly pointed out by Dr Polya.

In regards to the City's plans, it seem to be just a great hope that the gas will exist by 2030, but all we point out in our article is that if is doesn't, the trigen scheme will continue to burn fossil gas and most likely coal seam gas.

What is becoming clearer is that as the cost of fossil gas is pushed up on the east coast as we move to export parity pricing it will make it more attractive to develop biogas production to take advantage of higher prices. But the reality is that this will not contribute to a reduction in total fossil gas demand, it will only be a filler to meet domestic demand that can't otherwise be met because the fossil gas is contracted overseas. It all starts to look like a shaky model for a transition fuel.

I look forward to seeing the masterplan that deals with the gas supply problem but that has not been finalised and contracts have already been signed with coal seam gas related companies to deliver on the project.

In regards to Allan's response I believe it is the 2nd article linked below under the heading 'related articles': City of Sydney defends trigen scheme.

Justin Field

Posted Sunday, March 3, 2013 - 15:06

Thanks for the response Justin.

If we truly want to go to 100% fossil fuel and GHG emission free energy, biogas will be crucial for meeting peak electricity demands and other industrial, residential and transport needs. At the moment, the only other proposals to do this are CST with molten salts and in home battery storage. The commercial models for both have to be worked out. Don't get me wrong, I hope they do! Small issues such as water use for cleaning of mirrors and cycling of batteries will pop up and be overcome, but there is a lot of water to go under the bridge before we have more certainty.

There are numerous examples across the world where district energy projects start on fossil fuels and once they reach an economy of scale, move more and more to renewable fuels. Gothenburg's system was supplied by over 90% oil in the late 70's, and now utilises more than 90% recovered heat and renewable fuels. The Aalborg (Denmark) district heating system gets 15% of its heat from the local Cement Factory, and even some heat from the local crematorium!

These are long term projects, so criticising them at Year 1 without the facts misses the point unfortunately.

While BZE have busted a lot of myths with their work, and laid out a simple and inspiring vision, there is a lot to happen. For instance, on September 14 we may no longer have a carbon price and Clean Energy Package. Organisations taking responsibility for their GHG emissions and taking action should be encouraged, not criticised.

You continue with the spurious link of Trigen to CSG. Australia has one of the dirtiest electricity grids in the world, but I can buy Green Power off the same grid. When the City responds that they will contract non-CSG gas, you do not accept it? Please keep the debate based on facts rather than fear and such dirty tactics.

'What is becoming clearer is that as the cost of fossil gas is pushed up on the east coast as we move to export parity pricing it will make it more attractive to develop biogas production to take advantage of higher prices. But the reality is that this will not contribute to a reduction in total fossil gas demand, it will only be a filler to meet domestic demand that can’t otherwise be met because the fossil gas is contracted overseas. It all starts to look like a shaky model for a transition fuel.'

This is not relevant to the discussion. You are effectively saying we should give up now. Whatever we do, it will just see us export more gas overseas. Or more generally, no matter how many emissions we reduce here, the rest of the world will continue to generate emissions.

I disagree. If we create a market for and develop biogas projects in Australia, leading to replicable projects, this will a positive thing. We could possibly export biogas overseas, or export the skills and experience overseas, and help other countries reduce their emissions.

Coal exports are the same issue. Why reduce coal use hear, as we will just export more? What we need to do is lead and transform the economy. Trying to convince a lot of people along the way that it can be done. I don't believe your articles are helping this.

Thanks for the note, I now see Allan's article below. It is however not on your 'Global Footprint' selected articles, or 'See Also' section above, but your articles are. It is my understanding the New Matilda wishes to have journalism standards missing in the MSM, and that's why I mentioned it.