What is Natural Gas?

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What is natural gas?

What do we use natural gas for in daily life?

Is LPG a form of natural gas?

Hazards and safety concerns with natural gas

What should I do if I smell gas?

Is natural gas renewable?

Why is gas getting more expensive in Australia?

How is gas usage measured?

Is natural gas being phased out in Australia?

Find an energy plan that does more than blow hot air

Long story short

Natural gas powers more than just your cooktop

It might power your oven, heater, hot water, or BBQs, but it’s also the energy behind buses, factory processing, and some electricity generation.

Natural gas isn’t risk-free

Natural gas is prone to leaks, carbon monoxide, and fire hazards, so regular servicing and precautions like odours are there to keep your home safe.

Change is on the horizon for our energy

Natural gas is a non-renewable source that’s climbing in cost. While it’s still sticking around, there are cleaner sources like renewable hydrogen moving into Australia’s energy mix.

What is natural gas?

Natural gas is Australia’s third biggest energy source. Despite its name, it doesn’t come bubbling out of the ground ready to cook your dinner. Natural gas is odourless and colourless, forming over millions of years as heat and pressure squash plant and animal fossils under layers of rock formations. At first, these hydrocarbon sources are oil, but with more heat and pressure, they start to transform into gas pockets (mainly methane gas). This is why oil and gas deposits are usually found in the same place.

Once mined, natural gas has two paths. It’s either chilled at extreme temperatures into liquified natural gas (LNG), for storage or export, or transferred through Australia’s 23,000 km of underground pipes. Before it reaches your house, it’s processed and mixed with an odorant, which gives it that familiar rotten egg smell, so gas leaks can’t go unnoticed.

What do we use natural gas for in daily life?

Chances are natural gas energy powers your home in more ways than you realise. At home, it might fire up your stove, oven, heater, hot water system, BBQ, dryer, outdoor heater, or even your pool or spa.

But its reach goes well beyond the average home. Natural gas fuels buses and trucks, powers turbines for electricity processing, and drives industrial processes like manufacturing and food processing. While you might not see these uses first-hand, they all still play a part in our energy usage.

Is LPG a form of natural gas?

LPG (liquified petroleum gas) and natural gas are hydrocarbon gases, which means they both come from fossil fuels. Even though they’re derived from the same natural gas processing, this doesn’t mean they’re identical twins.

Natural gas is mostly methane, while LPG is propane or butane. When gas is processed, the ‘dry’ natural gas is separated from the ‘wet’ gas (which becomes LPG), as well as water and other impurities. So technically, LPG is a natural gas co-product.

Natural gas is lighter than air and flows through pipes into homes, while LPG is heavier and stored in gas bottles, cylinders or tanks. You most likely would’ve used LGP for your summer BBQ, while piped natural gas is the go-to for household appliances like your oven. To transport them, they’re both liquefied: LPG is put through intense pressurisation, while natural gas is cooled cryogenically, like turning steam into water with extremely cold temperatures.

Hazards and safety concerns with natural gas

While gas is one of the most common power sources, there are some safety concerns to consider when it comes to use in your home.

What should I do if I smell gas?

If you smell gas:

• Put out all flames and cigarettes.
• Don’t use any electrical appliances or switches (sparks can ignite gas).
• Turn off your gas appliances and make sure the pilot light is out.
• Open windows and doors, if it’s safe, to reduce any gas build-up.
• If it’s safe, go outside and turn off the main gas tap at your meter.
• Contact your gas provider on their faults and emergency number.

Helpful tip

Having your gas appliances serviced isn’t just a smart move for your safety, it could also help you save on energy costs from inefficient appliances. A professional servicing will make sure your gas appliances are working efficiently and safely. This can help reduce wasted energy and extend their lifespan. Fewer breakdowns and better efficiency can mean more savings for you in the long run.

Julia Paszka

General Manager – Utilities

Is natural gas renewable?

Natural gas is a cleaner energy alternative than other fossil fuels. But at the end of the day, it’s still a fossil-burning power. Yes, it does create fewer emissions than coal (about 50% less carbon dioxide), and oil (around 30% less), but it’s still very much a non-renewable source. Just because it’s called ‘natural’ doesn’t mean it’s eco-friendly.

Like other fossil fuels, natural gas reserves can’t be replenished as quickly as they’re used. Greenhouse gases are released when they’re burned, which contributes to air pollution and climate change. But it’s not just burning it that causes this pollution. Storing and transporting gas through wells and pipelines can release methane, a greenhouse gas much more harmful than carbon dioxide.

But there are some alternatives that are sourced a little more responsibly. Biogas – created by fermenting organic matter like food scraps, wood, and agricultural waste – is one option. It still produces emissions, but at a lower level than traditional gas. There’s only so much we can produce, so it can’t completely replace natural gas. That means it’s not something we can rely on long-term like renewables.

Renewable hydrogen is another gas replacement option that goes a step further, being fully renewable. Using solar or wind power, an electrolyser converts water into gas, producing a great substitute for natural gas that’s cleaner and cheaper to run.

For now, natural gas still has a key role to play in the global move to renewables. Because it can be turned on or off in a matter of minutes, it’s an important backup when solar or wind aren’t quite enough. Think of it like easing your foot off the brake rather than slamming it down. We need a transition fuel to keep things running smoothly until we reach net zero.

Why is gas getting more expensive in Australia?

Looking back, gas used to be one of the cheapest energy sources around. But that changed dramatically when the energy crisis sent rippling effects across global markets in 2022.

Even though Australia produces plenty of gas, around 80% is being exported overseas, which means we have to compete with international prices to buy it. Aussies have seen our gas prices triple since 2015, due to exports alone. Unless we reduce these exports, leaving more natural gas for Australians to use, these prices are unlikely to move much.

How is gas usage measured?

Gas usage is measured by megajoules (MJ), which you’ll spot on each gas bill you get. Even though natural gas and LPG are linked to your property in different ways, they’re both tallied up in the same way. Behind the scenes, your actual consumption is recorded in cubic meters (m³), then converted into MJ, to keep everyone’s bill standardised. It sounds complicated, but luckily, it’s all done for you, making it easier to understand your gas bill.

Is natural gas being phased out in Australia?

Moves towards phasing out natural gas are already happening. Victoria, for example, introduced a 2024 ruling that all new homes and buildings must be fully electric. (But if your home already uses gas or LPG, don’t worry; you can still access it.)

Australia’s net zero targets require stronger renewable power, which means reducing our natural gas energy consumption. This involves replacing it with low-emissions gas alternatives, to make sure any remaining usage is as low as possible. So, while no more bans are being laid down in the near future, gas needs to step to the side for us to be able to reach these targets. That doesn’t mean it’ll disappear overnight. It’s still considered a transition fuel that’ll support renewables and remain a critical part of the energy landscape beyond 2050.

But as households look for ways to future-proof their energy use, many are already weighing up whether gas or electricity would work better for their homes. So, while gas still plans on sticking around, it’s an important question to ask as the face of the energy market changes.

Find an energy plan that does more than blow hot air

If you’ve noticed your bill creeping up lately or want to make sure your current plan still works for you, it could be time to compare what else is out there. With iSelect’s online tool, you can compare from a range of energy providers and plans or call our energy comparison experts on 1800 664 532 to see how your plan stacks up.