Sustainable practices are a major focus for our business. We want to run things in a way that will enable us to meet the long-term expectations of both our owners and the community.
As Australia’s largest distributor of natural gas, AGN holds a key position in the nation’s fastest growing energy sector.
AGN delivers natural gas to over 1.2 million homes and businesses. Each year, around 25,000 new consumers are connected to AGN’s distribution networks. We generate revenue by charging energy retailers for transporting natural gas through its distribution networks and transmission pipelines to their customers.
Currently natural gas represents around 18% of Australia’s primary energy consumption. And this figure is predicted to rise, with the Australian Bureau of Resource Economics predicting that by 2020, around 24% of Australia’s energy requirements will be met by this environment-friendly fuel.
The natural gas industry explores for and extracts natural gas in remote locations, far from consumer markets. It's then sent via high pressure, large diameter and long distance pipelines (known as transmission pipelines) to capital and regional centres around Australia. From here, gas is sent to local distribution networks where it is delivered to our customers, who are charged for the gas they use by their energy retailer.
The Australian Energy Regulator (AER) is responsible for ensuring the interests of consumers and asset owners are appropriately addressed. This involvement by a Government-appointed Regulator means that once an Access Arrangement determination is made, usually for five years, AGN has considerable confidence about the revenue it will generate over this future period. The Access Arrangements set out the terms, conditions and tariffs to be applied to retailers when they use the Company’s distribution networks.
Natural gas offers a number of environmental benefits over other energy sources. It is the least carbon intensive fossil fuel and creates less particulates and other air pollution.
Natural gas from a distribution network delivers energy which is one-quarter to one-sixth of the emission intensity delivered from mains electricity. Despite significant investment in alternative technologies, the emissions intensity of the domestic electricity supply was 4.3% higher in the year to June 2015 than in the previous year due to a reduction in output from low emission, gas-fired power stations and an increased share of power coming from coal fired power stations.
As electricity generation from renewable sources increases, their intermittent nature means they need to be balanced by power generation systems that can rapidly adapt to differing energy supply requirements. Gas power generation is the only technology to offer the rapid response required to work with intermittent renewable energy generation. Gas can provide a cleaner more easily adjustable source of power than coal to support the growth of alternative power sources.
For households that have adopted solar energy to reduce their emissions, gas also plays an important role when the sun is not shining. Without gas fired generation in the Australian electricity system and a gas connection for cooking, Australian solar homes will generally be “cooking on coal”, because of the use of coal baseload power generation. In states which are heavily dependent upon coal fired electricity generation, such as Victoria, New South Wales and Queensland, using natural gas to heat (or cool) your home and provide hot water, can mean you are reducing your greenhouse gas emissions by up 84%.
Gas appliances are proven contributors to reducing Australia’s greenhouse emissions. In its 2014 report on progress of emissions reduction, the Climate Change Authority reported that:
"The most significant contributor to emissions reductions in the residential sector between 1990 and 2012 was gas heating. Gas replaced emissions-intensive electric heating as the gas network expanded. Gas appliances provide a great opportunity for households to introduce highly efficient and cost competitive comfort for their homes."
Gas is today’s low carbon option for cooking and heating. For households who take up solar to reduce emissions, gas also provides a low carbon solution when the sun is not shining and allows solar panel output to export to the grid when it is. Combining solar PV and gas appliances is the most practical and cost-effective way to achieve lowest carbon emissions.
Natural gas can deliver a hot water system that never goes cold, is one of the lowest cost options on the market and which has greenhouse gas emissions equivalent to a solar hot water system.
Gas hot water heaters deliver instantaneous supply with up to 83% less emissions than an electric resistance water heater – an abatement outcome which is on par with electric-boosted solar hot water systems. Approximately half of Australian households are still using emission intensive electric resistance systems which can produce up to six times the greenhouse gas of low emission alternatives.
(Source: Australia’s Bright Gas Future, Energy Networks Assoc, Dec 2015 .)
The range of activities undertaken by AGN which promote environmental responsibility and minimise the disturbance caused by the installation of gas mains and services on the surrounding environment and vegetation are:
- Job Impact Statement for all work conducted by field crews;
- HSE Management Plans developed for all major projects;
- Common trenching with other utilities to minimise disturbance;
- Directional boring to prevent damage to the root systems of trees located in nature strips and minimises disturbance to the surrounding environment;
- Leakage surveys conducted on regular programmed basis;
- Traffic management and control;
- Continual training and competency assessments;
- Long-life materials used for all gas assets to minimise disturbance from maintenance activities; and
- High standards for the clean-up of worksites to ensure that they are reinstated to near or better than original condition.
AGN also adopts measures to control the potential discharges to the environment from its activities. These measures have been incorporated into gas mains and services operating procedures, and include:
- Accelerated mains replacement project to upgrade and replace older cast iron mains in order to minimise leakage. More than 2,500 kilometres of mains have been replaced over the past ten years;
- Purging operations kept to a minimum, and where necessary, flaring is used to minimise the impact on the environment;
- Stockpiles of dirt from excavations are stored in a manner that minimises soil erosion and run-off into storm water systems;
- Sediment pollution traps and filters are used to minimise wastewater and sediment run-off into storm water systems;
- All wastes are disposed of at licensed landfill sites including disposal of hazardous materials e.g. ‘old’ asbestos cement meter boxes; and
- Waste reduction, re-use and recycling practices are promoted at all worksites and offices.
A comprehensive Safety Case governs each transmission and distribution network owned by AGN and managed by APA AM. These Safety Cases, which are approved by the Technical Regulator in each State, identify management responsibilities and the application of safe operational and facility management through strategic planning, workplace consultation and a systems approach to work practices and procedures.
In this way, the Safety Cases provide for the safe operation of AGN’s pipeline facilities in accordance with HSE best practice and license and regulatory requirements.
Key objectives of the Safety Cases for AGN’s gas distribution and transmission assets are to ensure that:
- A strong focus on safety is maintained;
- All risks are identified and effectively managed;
- Relevant information is communicated to those in need;
- Ongoing training and development to ensure required competencies are maintained;
- Adequate monitoring and controls are in place for gas pressure, quality and odorant to ensure safety levels are maintained; and
- Gas incident and emergency preparedness is maintained and tested to meet all probable eventualities.