Australia’s plumbing industry has raised concern about what it says are contradictory policy positions from the Federal Government in respect of gas.

Master Plumbers Australia & New Zealand (MPANZ) has expressed concern about the proposed classification of gas as a ‘phase down’ sector in a new rating system which is designed to help channel private capital investment into activities that will help to deliver upon Australia’s climate policy objectives.

This appears to contradict previous statements by the Albanese Government in its Future Gas Strategy about gas playing an important firming role in supporting renewable energy.

Such a contradiction may create uncertainty about the role of gas in the nation’s energy transition and may deter institutional investors who seek to enhance their sustainability credentials from investing in gas, Master Plumbers says.

“The Federal Government’s mixed signals regarding the role of gas in our energy transition are troubling,” MPANZ Save the Flame Committee Chair Nathaniel Smith said.

“On one hand, the Future Gas Strategy underscores the importance of gas in supporting renewable energy. On the other hand, the proposed green-ratings system discourages investment in this critical sector.”

The comments come amid the proposed treatment of gas in a green energy rating scheme being developed by the Federal Government which is designed to encourage investment in areas which are critical to Australia’s energy transition.

The scheme is being developed by the Australian Sustainable Finance Institute, which has been tasked by Treasurer Jim Chalmers in relation to its design.

Under the proposed scheme, sectors which are classified as being in either the ‘green’ or ‘transition’ categories are recommended as investments that will help Australia to deliver reductions in greenhouse gas emissions at a speed and scale which is needed in order for the nation to reach its decarbonisation goals.

However, The Australian reported last week that gas has been categorised as a ‘phase down’ sector in a consultation report released by the ASFI.

Whilst the paper has acknowledged the role of gas over the short to medium term as alternative firming sources such as batteries and pumped hydro are scaled up, it says that the firming role of gas in the 2050 economy remains uncertain.

The scheme is not intended to dictate investments which can and cannot be made.

However, it intends to provide guidance to those institutional investors who are keen to enhance their sustainability credentials about sectors which are considered to be critical to a sustainable economy.

The classification of gas as a ‘phase-down’ sector appears to contradict the Federal Government’s position in its Future Gas Strategy released in May.

Under that strategy, the Government acknowledged that Australia would need gas through to 2050 and beyond even in net zero scenarios – albeit with a need to find alternatives to gas and gas related emissions over time.

That strategy acknowledged that new sources of gas supply will be needed to meet demand during the transition.

The strategy also stressed the importance of Australia remaining a reliable trading partner for LNG and low emissions gasses to support energy security and decarbonisation efforts of key trading partners.

The role of gas in the energy transition is also supported by the Australian Energy Market Operator.

In its 2024 Integrated Systems Plan released in June, AEMO indicated that an optimal path to net zero by 2050 would actually involve a slight increase in gas production.

Gas will play a critical role in backing up electricity generation for sustained periods when renewables are unavailable, AEMO said.

Smith called on policy makers to ensure that investment frameworks support a balanced and realistic approach to achieving net zero.

“MPANZ is concerned that ideological opposition to carbon gas is being allowed to undermine the Federal Government’s previous stance that evidence-based policy will drive Australia’s energy transition,” Smith said.

“The Australian public and business community is already facing energy insecurity, and the plumbing industry, which is heavily involved in installing and maintaining gas infrastructure, needs clear and consistent policy direction.

“We urge the Federal Government to align its green-ratings system with the practical realities of our energy transition.”

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