Future Gas Strategy: consultation paper

10 November 2023

The Review Team
Future Gas Strategy
Department of Industry, Science and Resources

Via Email: GasOptions@industry.gov.au

Dear Madam/Sir

Future (Natural) Gas Strategy – Consultation Paper

Thank you for the opportunity to contribute to the development of Australia’s future natural gas policy settings and to respond to the Consultation Paper supporting the Future Gas Strategy (the
Strategy). We note that in the context of the consultation paper, “‘gas’ means natural gas, a fossil fuel consisting largely of methane and other hydrocarbons, occurring naturally underground”.

Master Plumbers Australia and New Zealand (MPANZ) serves as the collective representative body for member Associations spanning both Australia and New Zealand. Our role extends beyond national borders as we engage in collaborative efforts on both a domestic and international scale.
Members of MPA protect the health of our community and the environment through the delivery of professional plumbing services.

MPANZ represents plumbing contractors from sole operators to medium sized plumbing businesses and large contracting firms. Our members are installers of gas, water reticulation and irrigation systems, fire protection services, heating and cooling, mechanical services/air conditioning systems, sanitary disposal, drainage, metal roofing, wall cladding and other plumbing services.

The plumbing sector in Australia and New Zealand is a key enabler of economic growth and of climate change adaptation. The plumbing industry also plays a significant role in maintaining the health and wellbeing of communities across Australia, with nearly 29,000 plumbing businesses operating across the country. Plumbing and sanitation are the foundation of public health. In practice, this means our quality of life depends on the knowledge and skills of qualified plumbers, and fittings and fixtures that are fit for purpose.

MPANZ stands for the belief that regulated products, industry and properly qualified contractors and tradespeople have vital roles in the protection of the community. Our focus is on ensuring our members can meet the needs of their customers and consumers more broadly. In the context of gas that means providing a safe and efficient supply of gas to the public and providing choice to consumers.

As climate change drives changes how we collectively use energy and water, heat our homes, and hot water and cook our food, it is the skills of plumbers, gasfitters and related industry practitioners which are going to be key to our ability to undertake the transition safely and effectively.

MPANZ is supportive of the Australian Government’s commitment to reducing greenhouse gas emissions by 43% from 2005 levels by 2030 and net zero by 2050. As the Consultation Paper (the
Paper) recognises, the long-term and broad transition pathway to net zero emissions is inherently uncertain. Policy decisions and strategies must allow scope for adaptation to new information, and

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for different decarbonisation pathways to emerge as their relative economic and technical feasibility becomes clearer over time.

Recent experience has taught us that the cost and technical feasibility of various technologies will change, often significantly, as will investment trends, social license, and consumer preferences. In this context flexible policy options, industry stakeholder consultation, and industry support will be key to successful transition.

Charting a course and developing a Strategy for the future of gas is particularly challenging, complex, and nuanced. There are multiple relevant markets for gas to consider (local domestic market, commercial and production markets, and international export markets), as well as the development of the markets for renewable energy (domestic and export) and the various sub-markets which sit below that include the growing market for green hydrogen.

The Strategy is broad and ambitious insofar as it seeks to plot a long-term pathway for gas through all those markets, raising demand for some (export of Liquid Natural Gas), while simultaneously lowering demand for natural gas in others (domestic consumption). Within the tight parameters of legislated emission reductions targets the Strategy aims to produce and export more natural gas, a strategy which could be perceived as an exercise in emissions shifting (overseas), as opposed to global emissions reduction.

The Strategy relies on a range of other government programs and policy levers to drive the necessary changes (natural gas to electric conversion) at a domestic level, as well as a range of other dependencies, including a sufficiently large and skilled workforce to enable the transition. The
Paper poses questions and seeks input on a broad range of issues associated with the various natural gas and renewables markets relevant to the future of gas. In the attached response MPANZ provides comments on the issues most relevant to our members and the industry.

The key points MPANZ would like to see reflected in the Strategy, (and which are expanded upon in the attached response) include:

• We envisage a positive outlook and significant future role for renewable gasses (green
hydrogen and bio-gas). The Paper is somewhat dismissive of renewable gasses, especially
hydrogen, suggesting that it has a limited role in industry and as an alternative feedstock.
We contest this, and the points made at page 29 of the Paper about the level of pipe
upgrades required to enable green hydrogen to be transported or stored in existing
pipework. We see renewable gasses playing a significant role in domestic energy moving
forward, especially in the gas heavy states like Victoria.

• All in electrification is a high-risk strategy. Electrification of domestic and commercial
buildings is a central underpinning element of the Strategy. However, as a strategy moving
forward, we submit that full electrification has its limits and risks, and that these should be
considered in the Strategy, along with mitigation strategies.

For example, the energy required for an all-electric approach must come from somewhere,
and in many cases, including in Australia, it is currently coming from brown and black coal,
with natural gas also playing a significant role in electricity production. Renewable energy
currently makes up in the order of 32 per cent of Australia’s electricity generation. Until that
changes, and renewable production provides the power source of an all-electric economy, it
is hard to see how this is taking us forward.

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Increased demand for electricity also means more infrastructure (poles and wires) is
required, driving up costs for consumers. Other consumers might be left with no energy
options at all due to financial hardship or a power grid failure. This can be deadly. And all
the required infrastructure is expensive financially for taxpayers, but also has political and
social costs attached. When, for example, a community objects to a sub-station being
erected in their community or a farmer to a network being run across his paddocks,
governments face tough choices. The targets are ambitious, but political reality means
progress can be painfully slow.

• The Strategy relies on millions of Australians converting their homes and businesses from gas
to all electric which in turn relies on several factors. It depends on, for example, other
government programs (national and state-based subsidies, incentives etc.) to deliver results
for consumers – products that are effective, that last, that have been installed by a licensed
and competent practitioner in the right location and are fit for purpose. This is something
that cannot be taken for granted and MPANZ is strong in its view that every step should be
taken to layer the necessary accountability and product integrity structures into any
existing or proposed schemes to avoid program failure and to protect consumers.

Thank you again for the opportunity to participate in the development of the Future Gas Strategy.
Should you wish to discuss this submission, please do not hesitate to contact
.

Yours faithfully

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Department of Industry Science and Resources

Consultation Paper

Future Gas Strategy

Response by
Master Plumbers Australia and New Zealand

November 2023

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DEMAND

Consumers (domestic)

1. Do you use any international and/or domestic forecasts to inform your outlook of the gas
market? We want your views on which scenarios best reflect the demand outlook. Are there
any limitations or additional factors impacting the demand outlook you would like to note?

Managing demand in the domestic Australian gas market is challenging because the usual demand management levers, namely reducing supply and increasing the price, are not options available to policy makers when it comes to domestic gas. In fact, the goal of the Strategy is to lower domestic demand whilst increasing production and supply of gas and, ideally, lowering the price of gas for consumers.

This in part explains why, as the Paper notes, the number of gas connections in Australia has increased over recent years - despite the long-term financial incentives to transition away from gas, and regulations promoting electrification or banning gas connections. It also reflects the high upfront costs involved in switching from gas appliances to electric appliances, and, we suggest, may be indicative of the fact that there is growing awareness in the market about the limitations or shortcomings of the electric alternatives to gas (hot water systems that run out of water, reverse cycle air conditioning systems that do not heat homes effectively as gas heaters, etc).

These are key factors impacting the demand outlook. Another is the scale of the transition. Australia has over 5 million gas connections. Victoria alone has over 2 million. In that State, to reach net zero by 2045, which Victoria is committed to, most if not all those gas connections will need to be decommissioned, and the systems and appliances converted to electric. To meet the timeline, that means about 200 Victorian homes would need to be upgraded every day between now and 2045.

The process to develop a Future Gas Strategy serves to highlight the present lack of coherent and consolidated data about the scale and rate of the energy transition at a state and territory or national level. As expanded upon in our response to Question 8, shortcomings in the market data collection processes, which are more acute in some jurisdictions than others, makes it challenging to know exactly where we are at. Better market knowledge would drive an improved understanding, both within industry and the community, about exactly how far we are along the change continuum, preferably in per centage terms, and how far we still need to go to meet emission reduction targets.
This type of shared understanding can then inform training needs assessments, and potentially help motivate consumers to engage in the transition.

2. What role do you see gas-fired generators playing in supporting Australia’s 82% renewable
energy targets and beyond?

No comments.

3. How will the expected trends in demand from gas-fired generators impact other gas users?

No comments.

4. What should government do to consider managing these impacts and to mitigate energy
peaks caused by regional or seasonal variations?

No comments.

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5. How feasible, and at what scale, are alternatives to natural gas for the electricity sector? You
may wish to consider renewable gas alternatives for peaking generation, for example,
biomethane and low-emissions hydrogen and other forms of grid-firming technologies like
batteries and pumped hydroelectricity. What barriers exist to using these alternatives?

Renewable gas (hydrogen and biogas) need time to develop

Hydrogen has the potential to “change the game” in terms of renewable energy in Australia.
Hydrogen can be burnt for heat in place of natural gas across a range of uses - homes and businesses, in heavy industry and for electricity generation. Hydrogen energy can also be stored. Hydrogen storage is another form of chemical energy storage in which electrical power is converted into hydrogen and then stored safely (in, for example, existing natural gas pipelines) until it is ready to be released again by using the gas as fuel in a combustion engine or a fuel cell.

There are several significant pilot and feasibility studies underway in Australia and internationally, which are widely expected to provide “proof of concept” for green hydrogen production technology and drive its uptake within a relatively short time horizon (5-10 years). The Australian Hydrogen
Centre (AHC) has done extensive work in terms of identifying the hydrogen opportunity, and the steps required to ensure Australia maximises its existing advantages. ARENA has recently published the AHC reports, which were supported by Industry and the Victorian and South Australian governments - Australian Hydrogen Centre State-Wide Blending Studies - Australian Renewable
Energy Agency (ARENA).

The Reports conclude, after comprehensive analysis, that it is technically and economically feasible to use existing gas infrastructure for scaled hydrogen distribution, delivering:

• A net zero carbon emissions gas network;
• Minimised customer disruption whilst retaining security and diversity of energy supply;
• Services to the electricity grid through flexible electricity demand and frequency control;
• 15 gigawatts (GW) of electrolysis supported by over 30 GW of new renewable electricity
generation;
• 30 petajoules (PJ) of hydrogen storage to harness the ability of gas to store vast amounts of
energy, balancing renewable electricity supply and demand swings between colder and
warmer months; and

Some states are more suitable for renewable gas industry development than others. Victoria for example, has in place now some of the best hydrogen enabling infrastructure in the world. Rather than viewing Victoria’s reliance on gas as an additional emissions reduction burden to be overcome, we submit that Victoria’s gas network is a key advantage for Australia.

Victoria, because of its network and highly developed gas sector, can become a hub for renewable gas, as it has been with natural gas. Whilst other jurisdictions face significant infrastructure costs,
Victoria already has in place extensive gas related infrastructure and is uniquely placed to take advantage of the renewable gas opportunity.

We dispute the assertion in the Paper that existing piped infrastructure would need to be replaced or upgraded to accommodate hydrogen.

The impact of introducing hydrogen into the existing gas distribution network that services the
Australian Capital Territory (ACT) has been subject to extensive testing Hydrogen Test Facility – ACT
Gas Network – HyResource (csiro.au)

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This testing involved examining the ACT network components (e.g., distribution piping and valves) and construction and maintenance practices under 100 per cent hydrogen application. A pressure hold test was conducted from April 2019 through 2020, which demonstrated that there is no escape of hydrogen from the buried network materials. Appliance testing (and of associated piping, regulators, meters) with different blends of hydrogen and natural gas to gauge how different equipment perform on different blends is also well advanced with early results showing that an off the shelf natural gas cooktop can safely use blends of 20% hydrogen:80% natural gas with higher proportions of hydrogen also showing favourable results.

Victoria’s piped infrastructure currently used for natural gas is, generally, considered suitable for hydrogen. This is primarily because the network, which was once all steel pipes, has undergone significant upgrades over recent decades, and large parts of the network’s pipes are already either made of or lined with polymers (plastic), and can safely accommodate and distribute hydrogen.
Where there are parts of the network where upgrades are required to accommodate hydrogen,
Industry’s view is that the necessary upgrade work would require relatively low new capital expenditure or disruption to public infrastructure; and can be phased in as the hydrogen share of the hydrogen/natural gas blend increases.

If gas is removed from the energy mix prematurely (before hydrogen has a chance to fully develop), and the gas network asset ceases to be maintained, the prospects for hydrogen distribution and therefore the development of the burgeoning hydrogen sector, will be set back significantly.
Hydrogen is beneficial for the profitable growth of the renewable sector – it generates a favourable return for what would otherwise be surplus production while the sun is shining. It is potentially a very significant export product, increasing prospects for the renewable sector and value adding.

Hydrogen, with its power-to-gas conversion, is also a flexible source of balancing in the electricity system. Where there is an extensive reticulated gas network, that network can effectively become a giant battery, storing renewable energy. The economic value and utility of such a significant storage capacity, should not be underestimated. In its absence, a range of additional and expensive investments will be required in batteries, pumped hydro, other generation, and storage options.

Biogas is another important potential alternative to natural gas, particularly where it can be converted to biomethane. Biogas is a mixture of methane, CO2 and small quantities of other gases produced by anaerobic digestion of organic matter in an oxygen-free environment. The precise composition of biogas depends on the type of feedstock and the production pathway; these include the following main technologies:

• Biodigesters: These are airtight systems (e.g., containers or tanks) in which organic material,
diluted in water, is broken down by naturally occurring micro-organisms.

• Landfill gas recovery systems: The decomposition of municipal solid waste (MSW) under
anaerobic conditions at landfill sites produces biogas. This can be captured using pipes and
extraction wells along with compressors to induce flow to a central collection point.

• Wastewater treatment plants: These plants can be equipped to recover organic matter,
solids, and nutrients such as nitrogen and phosphorus from sewage sludge. With further
treatment, the sludge can be used as an input to produce biogas in an anaerobic digester.

The methane content of biogas typically ranges from 45% to 75% by volume, with most of the remainder being CO2. This variation means that the energy content of biogas can vary; the lower heating value (LHV) is between 16 megajoules per cubic metre (MJ/m3) and 28 MJ/m3. Biogas can be used directly to produce electricity and heat or as an energy source for cooking.

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Biomethane is a near-pure source of methane produced either by “upgrading” biogas (a process that removes any CO2 and other contaminants present in the biogas) or through the gasification of solid biomass followed by methanation:

• Upgrading biogas: This accounts for around 90% of total biomethane produced worldwide
today. Upgrading technologies make use of the different properties of the various gases
contained within biogas to separate them, with water scrubbing and membrane separation
the most common method.

• Thermal gasification of solid biomass followed by methanation: Woody biomass is first
broken down at high temperature (between 700-800°C) and high pressure in a low-oxygen
environment. The biomass is converted into a mixture of gases, mainly carbon monoxide,
hydrogen and methane (sometimes collectively called syngas). The methanation process
then uses a catalyst to promote a reaction between the hydrogen and carbon monoxide or
CO2 to produce methane. Any remaining CO2 or water is removed at the end of this process.

Biomethane has an LHV of around 36 MJ/m3. It is indistinguishable from natural gas and so can be used without the need for any changes in transmission and distribution infrastructure or end-user equipment and is fully compatible for use in natural gas vehicles.

Biogas is a particularly attractive option in the Victorian context because it can be injected directly into the existing gas network. In a similar way to hydrogen, Victoria’s biogas advantage lies in the gas pipeline infrastructure. Retaining and maintaining the pipe infrastructure and existing gas connections is vital if biogas (as biomethane) is to be an effective alternative fuel source to gas.

Premature full electrification could severely disrupt and limit the development prospects for green hydrogen because of the associated loss of hydrogen enabling infrastructure. A move to full electrification will mean existing domestic gas connections will reduce to the point where entire regions or jurisdictions have no gas connections. In the absence of customers, the pipes distributing gas to those houses or regions will, over time, cease to be maintained and become unusable. The ability of those unserved homes, businesses, and communities to take advantage of the hydrogen revolution, will be effectively foregone.

A Strategy that recognises the potential value of existing gas networks for the distribution of hydrogen and actively weighs up options for retaining and maintaining the vital gas connection and distribution architecture - in parallel with electrification – would help keep Australia’s energy options open.

Renewable gasses such as green hydrogen and biogas also add value by decreasing pressure on an already stretched electricity grid. All-in electrification will force a permanent, upward shift in demand for electricity which increases the risk of power disruption at peak times - domestic heating load currently met by gas also peaks in the early evening. Every home or business that uses renewable gas for energy will be one less home building the electricity grid has to service.
Substituting electricity for gas to meet residential heating requirements will compound the call on network capacity in the early evening, increasing the need for investment in further network capacity, at consumers’ expense.

6. How much longer will you continue using gas as a fuel source or feedstock for your business?
Do you think your consumption of gas will decline over time, and if yes, at what rate?

No comments.

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7. Are there alternatives that your business can use instead of gas (for example electrification,
hydrogen, biomethane or circular economy inputs)? What barriers exist to using these
alternatives? How can the substitution of gas be accelerated?

Renewable gases can help to reduce emissions whilst maintaining energy affordability, security and reliability, jobs, and consumer choice. There are viable renewable gas technologies currently available, and Industry maintains that, with the right policy support, renewable gas can play a major role in providing lower carbon energy to help power the Australian economy. However, the renewable gas industry needs to be developed, and we submit, developed quickly.

Australia already has in place some key enablers of industry development, in terms of things like skills and training; pipework infrastructure; and production know-how. For example, in training:

• Plumbers and gasfitters are the natural trade occupation to carry out the installation and
ongoing maintenance of hydrogen systems. Hydrogen skills are an adjunct to those existing
competency-based skill sets, rather than the creation of an entirely new skill set or trade.
Gasfitting is a key component of the plumbing apprenticeship (nationally) and if hydrogen is
incorporated into the Australian energy mix, plumbers’ gasfitting training can easily be
modified to ensure the ongoing safe operation of the gas networks and facilities powered by
hydrogen gas, as well as the safe maintenance of household gas appliances and commercial
premises.

• Hydrogen training development is well advanced. Under the Australian Industry and Skills
Committee framework, Industry Reference Committees (IRC) have been established for key
sectors. The relevant IRC for hydrogen training is the Gas IRC. The primary hydrogen training
development focussed body is the Hydrogen Technology Technical Advisory Committee
(TAC), established under the umbrella of the Gas IRC. The majority of hydrogen competency
development sits with the Hydrogen Technology TAC, upstream of the meter and this work
will inform the work of the Construction, Plumbing and Services IRC/TAC.

• Together these bodies have developed a hydrogen training package. The proposed package
is underpinned by two streams – combustion and fuel cell electrolysis and includes several
new units of competency which will ensure existing skills gaps are addressed.

• Developing detailed training for hydrogen is not only product dependent, but also Standards
dependent. Standards Australia has developed a detailed Strategic Work Plan for the
development of standards along the hydrogen supply chain. This includes production,
storage and handling, measurement, transport, transmission, and distribution of hydrogen in
its pure form, blended with another fuel gas, or via another hydrogen transport vector. Also
included are end use applications, such as hydrogen refuelling infrastructure and mobility
applications, domestic and industrial appliances (installation and service), and power and
heat generation.

• In Queensland, safety and health is regulated by government agencies including, the
Petroleum and Gas Inspectorate of Resources Safety and Health Queensland (RSHQ),
Workplace Health and Safety Queensland (Office of Industrial Relations) and the Electrical
Safety Office (Office of Industrial Relations). The Hydrogen safety code of practice 2023 was
released this year (the Code) and provides safety requirements for supply of unodourised
fuel gas and a consolidated framework on how to comply with safety requirements for
hydrogen fuel gas under the Act.

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• Nationally, the Net Zero Industries Division of the Department of Climate Change, Energy,
the Environment and Water recently embarked on an extensive industry consultation
process with a view to developing National Hydrogen Codes of Best Practice.

However, there are also industry development hurdles to be overcome. One of the barriers relates to the research and testing required to transition appliances and components to low and zero emissions technology. This includes new equipment required for domestic and industrial electrification, 100% and blended gas and other energy sources.

With new types of low and zero emissions technologies coming to market as part of domestic and industrial electrification, it is critical to ensure independent safety and efficiency compliance for consumer safety.

Currently there are limited product testing standards that include hydrogen or set efficiency standards for renewable gas appliances. To overcome this requires the development of fully equipped testing and training centres to assist product manufacturers with research, development and testing to get their appliances “hydrogen ready” or “renewable gas ready”, then take the next step and assess compliance to the relevant Standards.

These testing centres can help meet the demand and provide the optimal setting for essential research, innovation, testing and re-certification – and maintain the safety of the transition to a low and zero emissions future. If connected to Industry training programs, students can then upskill on the new technology before it is rolled out in the market, ensuring plumbers and gasfitters are ready to help enable the transition.

If hydrogen (blended or 100%) does form part of the energy mix going forward, and is embraced at scale, the capacity of these centres of excellence can be scaled up to match. As an example, as hydrogen replaces natural gas as the predominant energy source, some of the existing gas testing and training equipment can be transitioned to hydrogen testing.

The Strategy should, in our view, include plans to conduct this research, testing, and training locally as part of its pathway forward. In the absence of a local provider, product developers are forced to look overseas for product certification and testing. This means the Intellectual Property (IP) generated through the testing and certification process remains overseas and is not necessarily accessible by Australian developers, adding costs to, and slowing down, the uptake of renewable gasses.

A public awareness initiative should be launched to inform the entire Australian population about the potential opportunities and advantages linked to hydrogen gas. Consumer awareness of hydrogen gases is necessary to ensure safety, promote responsible usage, and make informed decisions regarding the adoption of hydrogen technologies in a rapidly evolving energy landscape.

In the context of a discussion about current “barriers” to the achievement of agreed emission reductions targets, MPANZ submits that consideration be given to the development of a broad community awareness campaign about the potential benefits of renewables gasses including biomethane and hydrogen. We would suggest that this be a national undertaking, potentially led by the Australian government with the support of the states and territories, as well as relevant industry and consumer associations and representatives, and MPANZ would be pleased to expand on this further.

To achieve our clean energy ambitions, it is important that we keep as many options open as possible. Australia needs more energy options, not fewer, and the all-in electrification approach risks crowding out emerging alternatives such as renewable gasses, both in industry development terms

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and in the minds of consumers, who are largely unaware at present of the potential of renewable gas.

8. What factor/s influence your willingness to adopt electric appliances or processes? How could
governments support small businesses to decrease gas consumption?

In considering the rate of uptake of electric replacements for gas appliances and systems, a relevant consideration is the effectiveness of the replacement systems, either in isolation or relative to that of the systems they replaced. A key challenge here is the lack of reliable data about the state of the market.

In Victoria for example, we know heat pump hot water systems and reverse cycle air conditioners
(heat pumps) are replacing gas using appliances at a rapid rate. We know too that a minimum there have been at least 73,000 heat pump hot water systems installed in Victoria since 2018 (69,000 under the Victorian Energy Upgrades Program - Victorian Energy Upgrades for households and 4,000 under Solar Victoria’s Solar Homes Program - Hot water rebate | Solar Victoria. Anecdotal evidence from industry would suggest that the number is much higher than that.

The problem is what we do not know about heat pumps. As a general comment, there is currently a lack of regulatory oversight and associated data and industry intelligence about the growing heat pump sector of the Industry. As one example, in Victoria at present, the regulating body for the construction sector, the Victorian Building Authority (VBA) does not record or report on the specific number or type of heating, cooling or hot water systems installed in Victoria.

As a result, in Victoria, where more gas is consumed than in any other jurisdiction, there is no regulatory line of sight around:

• the number, type, and quality of heat pump heating and cooling systems or HPHWS being
installed.
• whether they were installed by a licenced practitioner as required by the Plumbing
Regulations 2018 (licensed in Refrigerated Air Conditioning, Mechanical Services, or Water
Supply).
• do they work? - how effective or efficient are different types of systems proving to be in
different conditions and locations and when compared to the existing system?
• when they are not working efficiently, how do we know?
• to what extent are failings/poor performance due to the inferior product or the installation?
• Is there an increase in complaints around heat pump operations and what category do those
complaints fall into. Are they about, for example:
o Product performance/efficiency
o Product efficiency
o Cost
o Noise or appearance of the system
o Etc
Collating and analysing this type of data and market intelligence is important to Industry because it enables Industry (and policy makers and regulators) to understand the extent to which there are common themes to be drawn from experiences to date which can be translated into training for apprentices but also for established practitioners, via CPD or related top-up training. We would recommend that a part of this Strategy could be to compile this data on a national level, as several regions, such as Victoria, New South Wales, the Australian Capital Territory and Queensland, have initiatives that provide financial incentives to consumers for the installation of heat pumps.

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Raising the level of consumer and plumber knowledge about this important growing market is important for several reasons. Currently there is a major market information asymmetry between consumers on the one hand - who are keen to do the right thing by the environment and to reduce their power bills – and proponents (sellers) of heat pump products – which may or may not be fit for purpose for the individual consumer - on the other. Consumers generally have a low level of knowledge of what the heat pump systems they are agreeing to have installed are designed to do and not to do.

Choosing the right product for the situation – the right tank size, in the right place, fit for purpose for the relevant household – is key to achieving the efficiency and environmental advantages promised by heat pumps. It is also critical given that consumers are eligible for rebates (e.g.: VEU Program) once only – so when they use up their rebates on an inappropriate product, they face very significant replacement costs (and will likely revert to a less efficient system).

And it is not just consumers who are at a knowledge disadvantage in the heat pump market. In many cases working licensed and registered plumbers, who may have completed their trade training decades ago, are not sufficiently familiar with the technologies, systems, and products to enable them to assist consumers to make the right choices about heat pump products which best their situation (house lay-out; climate etc).

Australian jurisdictions are taking steps to improve and verify practitioner competence in this growing segment of the market. For example, in Victoria, dedicated solar heat pump hot water training is being delivered to industry through a partnership between Solar Victoria and the Plumbing
Industry Climate Action Centre (PICAC). In Queensland, plumbers who intend to install heat pumps and solar heaters must complete an endorsement on their plumbing license. Upon successful completion of this course, plumbers will possess the knowledge and skills to assess the design, planning, and installation specifications necessary to guarantee the safe installation of solar and heat pump water heating systems.

A key relevant consideration, not covered in the Paper, relates to the emissions potential of gas replacement technologies. A move to electricity from gas only benefits the transition where a lower emission fuel replaces a higher emission fuel. The Australian Energy Market Operator (AEMO) forecasts indicate continued significant contribution from non-renewable generation in electricity mix in 2030. If at that point, gas, with 50 per cent Greenhouse Gas (GHG), has been effectively shut off, it is not clear what the alternative non-renewable source will be, or whether it would be better or worse than gas in terms of GHG contribution.

Given current technologies, Industry is concerned that a move from gas to electricity will drive an increase in the use of heat pumps. Heat pumps contain high GWP refrigerant working fluid, which can have a global warming potential GWP over 1,000 times that of carbon dioxide. Some refrigerants, such as chlorofluorocarbons (CFCs) are extremely potent greenhouse gases. In fact, one kilogram of the refrigerant R410a has the same greenhouse impact as two tonnes of carbon dioxide, which is the equivalent of running your car for six months (source: Australian Department of
Agriculture, Water and Environment website 2021).

Refrigerants leak into the atmosphere from faulty or poorly maintained equipment, or when equipment is improperly disposed. Australia has specific laws that prohibit the importation of gases like CFCs and regulates the importation of synthetic greenhouse gases. Refrigerants, with their potential impact on emission reduction calculations, along with other issues raised by early electrification are not addressed in the Paper.

Avoiding fugitive emissions is also a relevant point when considering the role of biogas in the broader
Strategy. Methane (CH4) is a powerful greenhouse gas and is the second-largest contributor to climate warming after carbon dioxide (CO2). A molecule of methane traps more heat than a
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molecule of CO2, but methane has a relatively short lifespan of 7 to 12 years in the atmosphere, while CO2 can persist for hundreds of years or more.

Methane comes from both natural sources and human activities. An estimated 60% of today’s methane emissions are the result of human activities. The largest sources of methane are agriculture, fossil fuels, and decomposition of landfill waste. As discussed under Question 5, where there are significant emission reductions advantages of converting that methane into biomethane.

9. What role might carbon capture, utilisation and storage (CCUS) and negative emissions
technologies (NETs) (for example direct air capture and CO2 removal) play in decarbonising
industrial processes that are hard to abate in your business or industry?

See responses to Questions 5 and 8 above

10. If your home or small business gas appliances (stove, heating, or hot water system) stop
working, would you prefer to keep using gas or switch to an electric appliance? If you are
unsure, what would help you decide? What factors influence your willingness to switch to
electric appliances?

There are likely many reasons impacting consumers’ willingness to switch to electric appliances and could include:

• Product efficacy - for many consumers, particularly those in colder climates like Victoria,
Tasmania, the Australian Capital Territory and South Australia, the effectiveness of home
heating is a paramount consideration – and a higher priority than pure financial return on
investment or environmental considerations. Consumers in these regions have been
supported by governments to become very reliant on, and attached to, gas heaters - because
they are so effective and efficient. We maintain that the stubbornness of the demand curve
for gas reflects that.

• Complexity and confusion – feedback from our members would suggest that for many
consumers, the complexity of various state and federal government rebate schemes, the
breadth of products and systems on the market, and the (sometimes) conflicting advice from
retailers, installers and others adds up to a sense of that it is “all too hard” and it is easier to
just stick with what they have.

• Apparent policy inconsistency – a relevant factor may also be that consumers are genuinely
confused about why they should – or are being pressured to – forego gas. Some may view
the fact that Australia is seeking to expand production and export of natural gas, at the same
time as they are being forced to stop using natural gas domestically, as illogical, confusing
and inconsistent.

11. How can governments, industry and households work together to manage impacts for
homes?

Collaboration and partnerships between governments, industries, training bodies, and communities will be key to a successful energy transition, and key to the success of the Future Gas Strategy. The
Plumbing and Fire Protection Industry has a strong track record in this regard and stands ready to work with governments and consumers to facilitate a safe and just transition to renewables.

Our Association and our Industry have, for more than a decade, been committed to developing the vocational skills required to transform the built environment to adapt to climate change, reduce

Master Plumbers and Gasfitters Association
Master
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greenhouse gas emissions, and create new jobs. By utilising its skilled and experienced team, as well as the skills, experience and connections of our industry partners, the Industry has the existing capacity to support and complement the development of appropriate hydrogen training.

Our Association and our Industry have, for more than a decade, been committed to developing the vocational skills required to transform the built environment to adapt to climate change, reduce greenhouse gas emissions, and create new jobs. By utilising its skilled and experienced team, as well as the skills, experience and connections of our industry partners, the Industry has the existing capacity to support and complement the development of appropriate hydrogen training.

MPANZ is a part of a comprehensive network of private and public training RTO’s that can quickly understand the training that would be required to enable a particular approach or change, or add, to the scopes of works or regulations etc. Through MPANZ’s extensive partnerships, we are leveraging all opportunities to test products and systems and identifying existing and emerging industry training needs.

Master Plumber Associations (MPA’s) across Australia have supported both industry and public RTOs in developing appropriate hydrogen training courses and facilities. For example, the MPA in the ACT has a very valuable partnership with the public RTO which trains 600 apprentices per year. MPA ACT is also collaborating with universities and governments in Victoria and Queensland to develop course information and provide training in relation to hydrogen.

Through the Plumbing Industry Climate Action Centres (PICAC) in Victoria and Queensland, of which
Master Plumbers and Mechanical Services Association of Australia (MPMSAA), Master Plumbers
Association of Queensland (MPAQ) are, together with industry partners including the Plumbing and
Pipe Trades Employees Union (PPTEU), National Fire Industry Association of Australia (NFIA) and the
Air Conditioning and Mechanical Contractors Association (AMCA), developing specific training in hydrogen and other renewable gasses, as well as in heat pump technologies and systems.

In Queensland, MPAQ in partnership with the Queensland Government (which has contributed $24M in capital funding), has developed a world class Hydrogen Centre of Excellence. The purpose-built centre in Beenleigh in Southeast Queensland is equipped to train or retrain practitioners to use blended hydrogen, or pure hydrogen – and to do so safely. It also has demonstration and training equipment to train students on all aspects of fuel cell technology and green hydrogen production
(electrolysers).

Questions 12 -27 relate to Australian LNG in the world’s transition to net zero.

No comments.

Questions 28 and 29 relate to Carbon Capture and Storage.

No comments.

Questions 30-33 relate to distributors and LNG import terminal project proponents.

No comments.

Questions 34-38 relate to LNG production and facilities development.

No comments.

Master Plumbers and Gasfitters Association
Master
of Western
Plumbers
Australia
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Questions 39-45 relate to the domestic gas supply.

No comments.

Master Plumbers and Gasfitters Association
Master
of Western
Plumbers
Australia
and Gasfitters Association o