Energy, resources and environment update - July 2022

The South Australian State Budget contained several initiatives relating to these sectors, and a few are set out below:

• The Hydrogen Jobs Plan was announced with $593 million in funding over four years, which includes establishing a new hydrogen facility including electrolysers, a combined cycle turbine plant and a hydrogen storage capacity in the Whyalla region of South Australia.
• The Clean Hydrogen Industrial Hub at Port Bonython was announced with $30 million of State funding as part of an estimated $140 million partnership with the Commonwealth and the private sector.
• Confirmation that the previously announced funding for the Accelerated Discovery Initiative
  (ADI) is funded over forward estimates. The ADI supports the potential discovery of new mineral and groundwater resources by co-funding several explorations activities including (but not limited to); exploration drilling, geophysical programs, groundwater identification and testing, research collaboration and/or technology development.
• Funding of $6.4 million over four years for a new Mining Exploration Regulation System to digitise and automate exploration and mining-related approvals.
• Support for a Critical Minerals Strategy with funding of $2.5 million over two years to deliver the new geological critical minerals datasets.
• Support to the environment and biodiversity sector with $25.4 million of funding announced in several areas, including recruitment of 15 new Aboriginal park rangers, native vegetation grants to private landowners, support to the Conservation Council and Friends of the Parks, and establishing a biodiversity unit within the Department for Environment and Water.

• On 19 July 2022, the Australian Energy Market Operator
  (AEMO) activated the Gas Supply Guarantee mechanism to secure additional gas supplies from Queensland-based gas producers to support gas-powered electricity generation in the National Electricity Market (NEM).
• AEMO stated that the challenging generation conditions experienced in early June resulted in a greater reliance on gas-powered generation and larger than forecast inventory reduction at the Iona gas storage facility. AEMO’s system security notification attempted to reduce the depletion rates at Iona by requesting participants to cease purchasing gas from Victoria’s Domestic Wholesale Gas Market for supply to other jurisdictions. This notification was followed by a notification to cease purchase from Victorian electricity generation. AEMO indicated that the producers and pipeline operators responded positively to the requests.
• AEMO indicated that it expects the gas supply guarantee and threat to system security mechanisms to remain in effect until 30 September 2022 or until supplies and the threat to gas supply caused by Iona storage inventory depletion have subsided.

• On 19 July 2022, the Hon Tanya Plibersek MP, Minister for the Environment and Water, released the State of the Environment Report https://soe.environment.gov.au/.
• The State of the Environment Report, released every five years, combines scientific, traditional, and local knowledge, indigenous and non-indigenous people working together to create a holistic assessment of the state of Australia’s environment. The Minister indicated that it is one of the most important documents in environmental science.
• The report aims to help shape policy action, influence behaviours, and assess Australia’s environmental performance. The report assesses 12 themes; air quality, Antarctica, biodiversity, climate, coasts, extreme events, heritage, indigenous, inland water, land, marine and urban.
• The 274-page research was completed by a team of scientists in 2021 who found at least 19 Australian ecosystems showed signs of collapse or near collapse, indicating that our environment is under extreme pressure. The report indicates that the current environmental state and trends seen in Australia are poor and deteriorating because of increasing pressures from climate change, habitat loss, invasive species, pollution, and resource extraction. The report indicates that immediate action with innovative management and collaboration can turn things around but states that “Australia currently lacks a framework that delivers holistic environment management to integrate our disconnected legislative and institutional, national, state and territory systems”.

On 6 July 2022, the Australian Renewable Energy Agency (ARENA) announced that more than 3 gigawatts of battery storage projects with a combined value of $3.7 billion are competing for government funding through ARENA. The acting CEO Chris Faris said interest in the funding round had exceeded ARENA’s expectations. ARENA announced that 12 projects had been invited to submit full applications to the $100 million large-scale battery storage funding round. The funding round aims to support grid-scale batteries to be equipped with advanced inverter technology. “The 12 shortlisted projects represented the strongest of an impressive field, and we’re looking forward to seeing their full applicants”, said Mr Farris.

Mr Barry Goldstein, Executive Director of Energy Resources at the Department for Energy & Mining in South Australia, sadly passed away on Friday 15 July 2022 after battling a long illness. Barry was renown in the oil and gas sector, championing the industry and safeguarding the environment through a regulatory framework that has repeatedly been held up as a model to other jurisdictions. His achievements in the sector are numerous and wide-ranging, and the sector has certainly benefited from his devotion to the industry. DMAW Lawyers sends its condolences to his family, friends, and colleagues.

This article provides general commentary only. It is not legal advice. Before acting on the basis of any material contained in this article, seek professional advice.


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