The Fortescue Metals Group CEO did ruffle some feathers at yesterday’s Committee for Economic Development of Australia Economic and Political Overview in Perth though with his suggestion that gas would just be a transition fuel.

Given the importance of natural gas to the Western Australian economy the “transition fuel” line had a few people harrumphing in indignation.

However, Power’s logic is sound.

He argued that diesel fuel was a major expense for iron ore miners.

It is used to power the large trucks and excavators they uses but also to generate the power needed for the massive mine sites themselves.

While there are moves to make more use of natural gas in mining equipment, the biggest saving comes from replacing the diesel used in power generation.

“We have one of the largest resources of gas in the world in WA,” Power said.

“Yet here we are having to import diesel through a very difficult supply chain.

“A very short pipeline can connect us to these gas fields.”

Not only is it expensive to bring diesel in, Power said he was not sure where the benefit for the diesel fuel went – other than it did not come to Australia.

Gas, however, is a different story.

Australia’s largest gas hubs are in the Pilbara, where all these mines also happen to be so the logistics of getting it to them is not too difficult.

It would also be fairly easy to track where the benefits of buying that gas goes.

However, Power believes gas will only be a transition electricity generation fuel.

“We know, long-term, that renewables will form an important part of our electricity generation,” he said.

 “Most of the gas in WA will never be developed.

“Eventually renewables and storage will displace it.

“But until then let’s use gas, even just as a transition fuel. We need to maximise the value of our gas.

When it comes to renewable energy the Pilbara has a veritable smorgasbord to choose from. It is blessed with plenty of sunshine, so solar is on the menu. There are strong regular breezes, particularly in coastal areas so add in wind power. And then there are the massive tidal shifts around the region. Those very tidal shifts that make Port Hedland a difficult port to manage can also be a boon for green power generators.

If storage technology can get up to a commercially acceptable stage then renewables will have a real shot in the region.