Divisive gas plan for coronavirus recovery

Prime Minister Scott Morrison has launched the government's plans to boost Australia's gas sector.
Prime Minister Scott Morrison has launched the government's plans to boost Australia's gas sector.

Powering Australia's economic recovery from coronavirus with gas has sparked mixed reactions, with the plan labelled a betrayal, hot air and a good first step.

Prime Minister Scott Morrison on Tuesday launched the government's plans to boost Australia's gas sector, including a promise to build a gas power plant in the NSW Hunter Valley if the private sector does not step in.

He also wants to fast-track interconnectors and build more gas pipelines to ensure electricity can be moved around the east coast.

The Australian Energy Council says the government's threat of intervention may be counterproductive as it gives the sector further uncertainty.

"There are no material reliability concerns that would warrant this kind of interventionist approach, and there are already mechanisms in place to address any shortfall identified," chief Sarah McNamara said.

"The Australian Energy Market Operator's most recent assessment identified a potential shortfall in NSW of only 154MW."

Labor's energy spokesman Mark Butler says the plan doesn't create a single job for Australia when it's needed most, now.

"Australia needed a jobs plan from the prime minister today. All we got was hot air."

Independent Warringah MP Zali Steggall wants the government to focus on renewables.

"The Morrison government has captain's picked the technology of gas, whilst blackmailing private companies on an economic decision that is widely condemned by scientists, economists and investors," she said.

"This is completely against any kind of free market liberalism and shows how far Scott Morrison is willing to go to support fossil fuels over sound economic management and jobs."

Oxfam Australia has also blasted the government over the announcement.

"The prime minister's deeply concerning move to put gas, a fossil fuel, at the centre of our recovery from COVID-19 is a serious betrayal of our Pacific neighbours, whose very existence depends on us taking serious action against climate change."

But the petroleum industry is pleased.

"Today's announcement is a good first step to reinvigorate Australia's oil and gas industry, which will be important to help power Australia's economic recovery," the Australian Petroleum Production and Exploration Association said in a statement.

"Reliable and competitively priced energy is crucial to the health of our nation's economy."

The gas plan was recommended to the government by its National COVID-19 Commission, chaired by Nev Power.

Mr Power is a non-executive director of Strike Energy and former chief of Fortescue Metals Group.

Australian Associated Press