Less gas = more coal. And vice versa. It is a simple but effective formula.

AEMO recognises that in every Net Zero scenario, Australia needs more gas:

Without it, energy storage will not fill the gap left by coal, leaving policymakers with a gap that, so far, has been filled by public subsidies for…wait for it…coal:


The delays in the country’s energy transition meant Eraring would probably need to stay open into the 2030s and subsidies could extend beyond 2027, said Saul Kavonic, senior energy analyst at MST Marquee.

“Replacement green energy sources like the Central West Renewable Energy Zone are nowhere near on schedule, and the federal government remains unsupportive of gas generation,” Mr Kavonic said.

“So it’s almost inevitable that these Eraring subsidies will need to be extended beyond the current 2027 end date.”

It’s the same in VIC where secret deals between Labor and AGL keep Loy Yang running. QLD will be next.

Let us not forget the example of the US, which has used its gas so effectively to decarbonise that it is kicking Carbonstralia’s butt on a per capita carbon output basis (and much of our improvement is just immigration):


However, the East Coast gas cartel ships most available gas offshore, so we rely on public subsidies for…coal…to decarbonise…coal.

The only difference? Domestic gas reservation.

About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.