Gorgon CCS failures push Australia’s emissions higher, but renewables clean up the grid

A recovering economy, and failures at Australia’s only operational carbon capture and storage project, have seen Australia’s greenhouse gas emissions rise in the first three months of 2021, a new update to greenhouse gas emissions figures as shown.

While most sectors of the Australian economy continue to record declines in emissions – primarily due to the impacts of the Covid-19 pandemic – fugitive methane emissions from LNG production surged higher in the first three months of 2021, which the government partly attributed to failures at Chevron’s Gorgon carbon capture and storage project.

In the federal government’s latest quarterly update of Australia’s greenhouse gas emissions figures published on Tuesday, the reduced operation of the Gorgon CCS project – which has been plagued by delays and operational challenges – was blamed for increases in Australia’s fugitive emissions.

“Total gas and LNG production were unchanged in the March 2021 quarter. Reduced underground carbon dioxide injection at the Gorgon project and the restart of Prelude caused an increase in fugitive emissions from the crude oil and natural gas sub-sector,” the latest quarterly update says.

“Coal production grew by 5.3% in the March 2021 quarter, contributing to the overall increase in fugitive emissions after the decrease in December 2020.”

Emissions from the agricultural sector also increased in the year to March 2021, with the alleviation of drought conditions seeing cattle numbers begin to recover. Agricultural emissions jumped 2.1 per cent over the 12-month period and are expected to continue increasing as farmers rebuild their herds.

However, one bright spot is the growing supplies of wind and solar power that have made the largest structural reductions in Australia’s greenhouse gas emissions, pushing more expensive and emissions-intensive coal and gas generation out of Australia’s electricity market.

The amount of electricity supplied by renewable energy sources increased by 11.4 per cent in the first three months of 2021, driving a 4.4 per cent decline in coal generation. This combined to push emissions from the electricity sector down by 5.6 per cent, compared to the same period a year prior.

Climate Council senior researcher Tim Baxter said that the transition to cheaper and cleaner electricity supplies could be expected to delivered continued cuts to Australia’s emissions..

“Wind and solar energy are the cheapest way to add new capacity to the grid, and continue to generate clean, affordable electricity as unreliable coal and expensive gas decline,” Baxter said.

“Record rates of rooftop solar uptake and massive investments by state and territory governments in large-scale wind and solar are driving a bright outlook. By 2025, we should see the grid being able to handle 100 per cent renewable electricity at certain points in time.”

“Meanwhile, coal continues to be the electricity grid’s greatest liability, with Yallourn Power Station vulnerable to failure during an extreme rainfall event,” Baxter added

In an early sign of what a post-Covid recovery might mean for Australia’s emissions, transport emissions jumped 5.2 per cent higher in the first three months of 2021, as Australians began to travel more during a generally relaxed period of restrictions when Covid-19 case numbers remained low.

Interestingly, it was petrol consumption that took the largest hit due to Covid-19 travel restrictions, as many Australians switched to working from home, while the consumption of diesel fuels – consumed primarily in the resources and agricultural sectors – remained largely unchanged.

Overall, Australia’s greenhouse gas emissions rose 0.7 per cent on a seasonally adjusted and weather normalised basis during the first three months of 2021, as early stages of the Covid-19 recovery also worked to see Australia’s emissions bounce back to previous levels.

For the 12-month period to March 2021, Australia’s emissions fell by 5.3 per cent, largely thanks to strong growth in the market share of renewable electricity and the temporary impacts of the Covid-19 pandemic, with travel restrictions leading to a 13.2 per cent fall in transport emissions.

Australia’s total emissions fell to 494.2 million tonnes, which is down 20.8 per cent from 2005 levels, but the extent of this decline is likely to be temporary, with the Department of Industry, Science, Energy and Resources already flagging that annualised emissions could jump back to more than 500 million tonnes in the next quarterly update, to June 2021.

While the Morrison government has sought to take credit for recent falls in emissions, Australia's emissions remain defiantly high and are not reducing at a rate necessary to ensure Australia can achieve a net zero emissions target by mid-century.

The federal government is required to table each quarterly estimate of Australia's greenhouse gas emissions in compliance with an ongoing order of the senate.

While prime minister Scott Morrison praised the 'transparency of his government's practice of publishing quarterly updates of Australia's emissions data, as has become usual practice, the August update was again distributed to sympathetic media outlets before the report was provided to the senate and before it was released to the general public.