Households embrace new energy shift as waste fuels power revolution

There's something remarkable happening in Denmark that should make every Australian household sit up and take notice. Three experts from the Danish gas and electricity grid operator Energinet confirmed that the country has been completely reliant on biomethane for several days this summer and last, meaning an entire nation powered its gas needs using nothing but renewable energy made from organic waste.

What makes this even more impressive? In 2023 the share of biomethane in the Danish gas system reached almost 40 per cent, and by 2030 Danish gas consumption is expected to be 100 per cent green. They're not just talking about it—they're actually doing it.

Meanwhile, here in Australia, we're finally starting to catch up with our own exciting developments in this space.

Australia's Biomethane Breakthrough: Finally Getting Started

The good news is that Australia isn't just watching from the sidelines anymore. The Australian Gas Infrastructure Group (AGIG) has signed an agreement to connect the first biomethane project into its South Australian gas networks.

Under the agreement with local bioenergy business Delorean Corporation, up to 210 terajoules of biomethane generated from commercial and industrial organic waste will be injected into the existing gas network each year.

This marks a significant step forward from Australia's first demonstration project at Sydney's Malabar wastewater treatment plant.

The Malabar project has an initial capacity of 95 terajoules of renewable gas per annum. This is equivalent to the average annual gas usage of 6,300 NSW homes.

The potential is enormous. The Australian Renewable Energy Agency (ARENA) has projected that Australia could produce 371 petajoules of biogas annually, equivalent to 23 per cent of current fossil methane consumption, and biomethane could contribute $10bn to its economy by 2030.

What This Means for Your Gas Bill

For Australian households, particularly those watching their energy costs carefully, this development could be genuinely significant. According to Finder's Consumer Sentiment Tracker, the average gas bill in Australia is around $231 per quarter, with costs varying significantly between states.

Biomethane is interchangeable with natural gas, being mostly methane just as natural gas is, and can be blended into existing gas networks. It allows customers to continue using gas appliances in the same way they do today, but with the advantage of the source being renewable.

The beauty of this technology is that you won't need to change a single appliance in your home. Your gas cooktop, hot water system, and heating will work exactly as they always have—but they'll be running on renewable energy made from what used to be waste.

The Farmer's Gold Mine: From Waste to Wealth

Here's where the story gets even more interesting for rural Australia. The biomethane production process creates a valuable byproduct called digestate—essentially a nutrient-rich fertilizer that farmers are discovering is worth its weight in gold.

Biogas slurry contains 93 per cent water and 7 per cent solids, with vital nutrients: 1.5 per cent nitrogen, 1.1 per cent phosphorus, and 1 per cent potassium, making it an effective natural fertiliser that can cut chemical fertiliser costs drastically.

Australian farmers using digestate have reported impressive results. A dairy farm in Victoria achieved a 60 per cent reduction in their carbon footprint within the first year of biogas adoption.

The closed-loop system not only processes animal waste but also provides renewable energy for farm operations and creates nutrient-rich fertiliser as a by-product.

The numbers are compelling for farmers. Field tests show biogas slurry boosts crop yields significantly—rice yields increased by 30 per cent, while maize production went up by 25 per cent, with farms saving £200 per hectare on chemical fertilisers.

While these are international figures, similar benefits are being reported by Australian farmers adopting the technology.

Why We're Behind (But Catching Up Fast)

So why has Australia been slower to embrace this technology? The answer lies partly in our abundant natural gas resources and lower population density. Arriving back home in Australia, I was met head on with the false dichotomy of the Australian decarbonisation debate—a debate in which you're either for electrifying everything or branded as a fossil fuel apologist for suggesting alternatives.

A debate in which one jurisdiction, the ACT, is so committed to their gas ban that they rather tell all commercial and industrial gas users reliant on Type B gas appliances that they will have to move to specific industrial estates to continue operating their businesses. A debate in which another jurisdiction, Victoria, is (at the time of writing) consulting on policy that assumes gas bans are a given.

However, attitudes are changing rapidly. The AEMO forecasting process which asks CSIRO to model gas electrification has started to undertake its own investigation into the true cost and availability of biomethane. This analysis is expected to become a required input for CSIRO modelling from here on.

Our Infrastructure Advantage

One significant advantage Australia has is our existing gas infrastructure. At least 86 per cent of the biomethane plants currently active in Europe are known to be connected to the gas grid, demonstrating that this technology works seamlessly with existing networks.

AGIG is supportive of Australian government targets to reach Net Zero and has a goal to deliver 100 per cent renewable and carbon-neutral gas in its distribution networks by 2050. AGIG CEO Craig de Laine said projects like Delorean's were helping to demonstrate the pathway towards low-carbon gas networks.

'Renewable gases such as biomethane will play a critical role in delivering a secure, reliable and affordable low carbon energy transition for Australia. This will be essential for those customers that rely on gas today and want to continue to choose gas to meet their energy needs into the future'

What to Expect: A Realistic Timeline

While the technology is proven and working internationally, Australian deployment will be gradual. Mike Davis from Optimal Renewable Gas, mentioned in the original article, has plans for 10 sites across regional areas and hopes to inject renewable gas by late 2027.

The European experience shows what's possible with the right policy support. The European Biogas Association (EBA) released its yearly report showing that in 2023 biomethane production increased by approximately 20 per cent year on year, to 4.9 bcm across the EU.

The increased production comes on the back of a healthy rate of deployment in the market. Installed plant capacity by the end of 2023 was up 40 per cent year -on year, to 6.4 bcm/year. France and Italy have been responsible for much of the recent increases in plant number and production volume due to generous production support schemes.

The Industries That Need This Most

Not every part of Australia's economy can easily switch to electricity. Renewable gases such as biomethane will play a critical role in delivering a secure, reliable and affordable low carbon energy transition for Australia. This will be essential for those customers that rely on gas today and want to continue to choose gas to meet their energy needs into the future.

From steel manufacturing to glass production, many Australian industries depend on the high-temperature, reliable energy that gas provides. For these businesses, biomethane offers a pathway to decarbonise without completely restructuring their operations.

The Waste We're Currently Wasting

Perhaps the most compelling aspect of this story is how it transforms our relationship with waste. Australia produces around 48 million tonnes of organic waste per year from domestic and industrial sources. This accounts for a portion of national greenhouse gas emissions.

Every time you put those vegetable scraps, that wilted lettuce, or grass clippings into your green bin, you're looking at potential energy. When it comes to handling large volumes of waste, anaerobic digestion requires less space and much less time than large scale composting would.

And instead of the byproduct methane being released into the atmosphere, anaerobic digestion allows for it to be captured and re-used as biomethane.

The Danish example shows us what's possible when a country commits to this technology. They didn't achieve 40 per cent renewable gas overnight—it took consistent policy support, investment in infrastructure, and recognition that not everything needs to be electrified to be green.