CQ Today – The energy crisis in Australia

Australia has more resources per person than any country in the world except for Saudi Arabia. Yet we are entering the worst energy crisis since the 1970s as one of the most vulnerable countries in the world. Our vulnerability is a choice, not our destiny. Under Labor’s obsession with net zero emissions, we have made a choice not to use our abundant energy resources, most of which are contained in our massive coal reserves. Australia has 6.3 million petajoules of proven energy resources. This is enough energy to meet Australia’s energy needs for more than 1000 years. (There is no doubt we have much more, this is just what we have found thus far.) So why do we face running out of petrol and diesel? Our problem is that 95 per cent of our energy resources are in coal and uranium. Neither of these resources can easily substitute for our use of petrol, diesel, LPG and other petrochemical products. Australia does not have an energy production problem, we have an energy conversion problem. Because we do not produce large quantities of liquid fuels, we have had to find a way to convert what we have into what we need. In recent years we have solved this problem through a conversion process known as trade. We ship the energy we do have, primarily coal and gas, and we import the energy resources we do not have, petrol and diesel. Often the same countries we export the coal and gas to, like Korea, Singapore and Japan, are the ones that we import the liquid fuels from. This trade has served us well, but it does make us vulnerable to an interruption in trade, such as what we have seen following the Iran conflict. A new report this week released by the Page Research Centre, a Nationals Party aligned research body, highlights the extent of this vulnerability. Half of Australia’s imports by weight are in the form of liquid fuels. Another 10 per cent are petrochemicals that are made from oil. This means that in the event of conflict, Australia faces the mammoth defence task of having to devote naval assets to protect over half of the ships arriving in Australia just for the most basic of essential commodities. Some claim that Australia can reduce our dependence by moving to electric vehicles. But even if all of Australia’s cars went electric then we would reduce our oil demand by only 30 per cent. Most defence assets, like tanks, ships and planes, will continue to rely on oil for the foreseeable future. There is also too much focus on stockpiles rather than production. While more stockpiles can help, they are only a bridge to a more permanent solution. If all we rely on are stockpiles, any adversary knows that they need to smoke us out and wait. Another way we can solve our energy conversion problem is through coal to liquids technologies. You can burn our abundant coal, turn it into gas and then use a catalyst to create carbon chains of all different types, including petrol and diesel. This technology is proven and used around the world. South Africa produces about 40 per cent of its liquid fuel needs from this process and China has been increasing its coal to liquids production. There have been Australian companies that have wanted to produce liquid fuels from coal too. But green regulations and carbon taxes have killed all of these projects. After spending its first four years in Government in a war on fossil fuels, Labor has belatedly realised that we need fossil fuels. This week they rushed through emergency legislation to subsidise the importation of fossil fuels into Australia. We tried to move amendments that would allow us to invest in the domestic production of oil and gas, including things like coal to liquids technologies. But Labor refused to support these. So the Australian Labor Government is happy to subsidise the creation of oil industry jobs in overseas countries but not to support the creation of Australian oil jobs. Labor’s approach may be a band-aid for our current situation, but it will only entrench our dependence on other countries. We instead need to back the Australian production of oil again.