Analysis of upstream gas network constraints for power generation in Queensland

The degree of structural and operational integration between gas and electricity markets has increased sharply in the last decade internationally and also in Australia. This paper investigates the optimal gas production profile for the state of Queensland (QLD) in Australia, with a view to analyzing the ramifications of gas network constraints for large-scale gas-fired power generation (GPG). GPG is projected to grow significantly as part of the Australian government´s strategy to reduce carbon emissions and wind down coal-based generation. This paper employs a least-cost optimization using a linear programming (LP) model to understand the level of expansion that pipeline infrastructure would need to cope with forecast power generation demand. Results show the QLD gas network will reach capacity limits by 2015 at significant cost to the economy, demonstrating a need for further investment. There are significant network constraints that would render meeting demand from the power sector a major challenge.