Why is Australia building a $600m gas power plant as world experts warn against fossil fuels?

Morrison government says it will provide cheap energy but experts say renewables are already providing cheaper, cleaner alternatives. So who’s right?

The Morrison government says it will spend up to $600m on a new gas-fired power plant in New South Wales – the latest in a series of announcements dedicating taxpayers funds to greater fossil fuel use.

Meanwhile, the International Energy Agency has released a landmark report saying there should be no new investments in coal, oil or gas if the world is to keep open a narrow possibility of meeting the goals of the Paris climate agreement and reaching net zero global greenhouse gas emissions by 2050. It has laid out a pathway that could get the world there.

Related: Coalition quietly adds fossil fuel industry leaders to emissions reduction panel

Schott telling Guardian Australia, and the government, that the case for a gas plant in the Hunter Valley “doesn’t stack up” commercially given there is an abundance of cheaper and cleaner alternatives flooding the market.

The Australian Energy Market Operator (Aemo) finding there is no need to replace the exiting Liddell coal plant in 2023 because the gap to ensure grid reliability was only 154MW, and that has already been covered by other commitments.

A taskforce advising governments about the impact of the Liddell closure backing this up by finding NSW did not find an additional 1,000MW to keep the lights on, and listing a range of committed and probable projects that it found would be “more than sufficient”.

Aemo finding that while between 6 and 19GW of new dispatchable power would be needed over the next 20 years under an optimal future grid – ie, a grid that runs nearly entirely on solar and wind as coal is pushed off the field. It could come from a range of sources including batteries, pumped hydro and demand management. It said new gas was an option but – in apparent contradiction of Morrison’s claims that gas generation would bring prices down – that it was likely to be more expensive than other options.

That by directly interfering in the electricity market the federal government is likely to further discourage the private investment needed to deliver the huge amount of dispatchable generation needed over the years ahead. This argument suggests an overarching policy that sets an emissions trajectory – such as a carbon price – would be a cheaper and more effective approach that could guide private investment.

Last, but by no means least, gas is a fossil fuel that releases about half the emissions of coal when burned, and contributes even more to global heating once methane that leaks during extraction and piping is counted. The argument is backing the option to support the electricity grid that adds greenhouse gas emissions when there are cleaner and cheaper alternatives.

Most of the reduction is due to a substantial drop in land-clearing and native forestry in some states and has had little to do with restructuring a still mostly a fossil fuel-based economy.

About two-thirds of the 19% cut came when Labor was in power federally, not the Coalition.

A small chunk of the 19% is due to coronavirus-related shutdowns last year. Emissions from some sectors, such as transport, may increase this year.

Official government projections released in December forecast there would be only a 6.8% fall over the decade to 2030, with emissions from transport, mining and agriculture either flatlining or increasing under existing policies.

The Morrison government has taken steps to slow the shift to a clean energy grid by allowing federal support for large-scale renewable energy to lapse after the national renewable energy target was met two years ago.

Most comparable nations, including all members of the G7, have shifted gears in recent months and increased their commitments for the next decade to make much deeper cuts in emissions than Australia is planning.

Meeting some of the targets will be challenging, but they are increasingly introducing policies to meet them – see, for example, Joe Biden’s proposals in the US and what Boris Johnson is doing in the UK.

Related: The 2021 federal budget was light on climate and environment measures. But here’s what you should know