NSW energy minister says ‘the business case for gas is on the clock’

Breaking ranks with some of his Liberal party colleagues, NSW energy minister has told a meeting a pro-climate action conservative group that “the business case for gas is on the clock.”

The comments, from a Liberal party state minister, puts Kean at odds with his federal counterparts, who have been doggedly advocating for a ‘gas led recovery’ to the Covid-19 triggered recession.

Kean made the comments in a speech at the launch of the ‘Youth for Conservation’ group on Tuesday night, a group that has been created within the Coalition for Conservation, to bring together young members of the Liberal and National parties who support stronger action on climate change.

Kean told the event that he did not think that gas would play a long-term role in Australia’s energy mix, and that those who had been advocating for more investment in coal and gas were in effect advocating for higher energy prices.

The Coalition for Conservation has been established primarily by members of the Liberal and National parties, as a response to the role that some party members, particularly those on the federal Coalition backbench, have played in disrupting the development of stronger federal policies on climate change and clean energy.

In his comments, Kean suggested that he did not think that gas would remain economically viable into the long term, and that governments and businesses should be preparing for the emergence of lower cost energy technologies.

“We should be making decisions based on the economics and gas is a hugely expensive way of generating electricity,” Kean said.

“As we get cheaper technologies, we should be moving towards that, not making decisions based on how we generate the electricity, but making decisions based on if we get the electricity when we need in the cheapest form possible and if we stick to those principles, let me tell you, gas is not part of the mix.”

“My view is that government should be supporting technology which will deliver the cheapest form of reliable energy possible and right now that’s not gas, that’s not coal, it’s certainly not nuclear. It’s wind and solar backed up by pumped hydro and batteries,” Kean added.

“Those people arguing for coal, for nuclear, for gas, they’re actually arguing for more expensive, dirtier forms of energy.”

Kean’s comments came just hours before the Independent Planning Commission issued its approval to the controversial Narrabri Gas Project.

In separate comments, Kean has said that he thought the Narrabri project would be a ‘big gamble’ for project developer Santos, in light of both the higher costs of producing gas at the project, and the global contraction in gas investment currently underway due to a collapse in global gas demand.

Kean questioned whether Santos would in fact develop the Narrabri project, given the investment risk, and following Santos recently writing down the value of its existing gas investments by more than $1 billion.

Kean has been a much more open supporter of ambitious policies in support of reducing greenhouse gas emissions and for the adoption of clean energy sources in New South Wales. Kean has helped secure a commitment by the Berejiklian government to achieving a target of zero net emissions by 2050, and the creation of several Renewable Energy Zones across the state.

Kean’s position has often attracted the ire of conservative critics both inside and outside of the Berejiklian government.

“Climate change is the biggest challenge that will face our society and our economy in our lifetime,” Kean told the Youth for Conservation launch event.

“We know that Climate change will lead to more extreme weather events – and that these are already happening now. Last summer’s bushfires were the worst bushfires in the state’s history.”

“The approach we take on climate change defines the sort of country we live in and the type of people we are,” Kean added.

Kean pointed to the conservative governments of Germany, France and the United Kingdom as examples of how the conservative side of politics could embrace more ambitious climate change targets, with success.

“If we leave it to the left, taking action on climate change will be about redefining the role of capitalism in society,” Kean said.