rss
22

Queensland “pissing money againt wall” with coal deal

Print Friendly

images-9The Queensland government’s decision to use taxpayer’s money to invest in the giant Galilee coal investments that have snubbed by major international and Australian banks has been ridiculed.

Campbell Newman’s Coalition government is set to invest hundreds of millions of dollars into the mine, and it’s associated infrastructure. This comes as many international banks refuse to back the upgrade of the Abbott Point coal terminal, and others baulk at the $3 billion cost of the rail link.

Even though it is conceivable that a coal mine could generate some short term profits from international sales, few believe that the coal market will be long standing, and fear that the associated infrastructure, with a life of 30 years or more, will end up as stranded assets.

“Many would consider this a Government simply pissing taxpayers’ money up against the wall,” Tim Buckley, Director of Energy Resource Studies Australasia at the Institute for Energy Economics and Financial Analysis (IEEFA) said.

He said Australia’s “coal addicted” politicians have stepped up with public cash “where international financiers wouldn’t dare to tread”, by proposing to use taxpayers money to fund “unviable and highly questionable” coal projects.

“The people of Queensland and Australia should be outraged at this idea of questionable politicians spending many billions of tax payer dollars to make an unviable, unwanted and dangerous mega coal project a reality,” Buckley said.

Buckley noted that Newman has historically been at pains to say that the state of Queensland is in dire financial straits with huge debt – $80 billion.

“The Galilee coal projects are totally, commercially unviable. Any project undertaken is highly likely to end up as a stranded fossil fuel asset as the rest of the world rapidly transitions to lower carbon solutions. Coal has entered structural decline – there is no two ways about that fact,” he said.

Australia – at federal and state level – is insisting that coal has a long term future, but the stand ignores both the cost of imported fuel for nations such as China and India, and their growing options in other energy sources.

China has already halved its coal imports and may cut them altogether. India has even indicated it may not need to import coal within a few years, although that does depend on getting its internal infrastructure into order.

An investment by the Newman government would come despite his railing against subsidies for rooftop solar and large scale renewables! and will come on top of the $600 million a year subsidy paid to keep down the cost of delivery of coal fired power to regional areas.

“We want a new coal basin to open,” Newman has repeatedly stated.

But Buckley said  Eight of the largest global financiers have already said they wont provide financing to the Galilee projects,” Mr Buckley said.

On Wednesday 12 November 2014 India’s Energy Minister Piyush Goyal said he plans for India to cease importing thermal coal within 2-3 years.

“This makes a mockery of the plan by Adani to export 2/3 of the Carmichael coal back to India. His own energy minister is making it clear India cant afford to solve energy poverty using hugely expensive imported coal.” Buckley said.

Goyal early last week cited distributed solar and microgrids, wind farms, energy efficiency, grid efficiency, plus domestic coal and hydro as the preferred domestic solutions.

“This is a taxpayer subsidy of a private foreign company who has to-date invested almost no equity capital into the Australian economy.”

   

Share this:

  • James Fisher

    This really is quite unbelievable. In spite of all the rhetoric, Newman is happy to waste millions!

    • Peter Billing

      -millions- billions

      FIFY!

  • Glen S

    Scary indeed, QLDers must be thinking “Yay, my taxes are paying to destroy the GBR in order to allow a foreign company to profit in the short term by exporting coal to their own country that won’t want it within 5 years!”

    What must Modi have been thinking as he signed that deal this morning?

  • David Osmond
  • Mark Maiden

    Scaling new heights in utter bloody mindedness that is going to put Queenslanders hugely out of pocket, when they could be riding a renewable energy revolution that not only is forward thinking and more than likely profitable (admittedly in the long run) on top of being good for our planet.

  • John P

    The recent ICAC hearings in NSW may have given thoughtful observers the idea that the Liberal party, as currently constructed, is culturally corrupt. This infatuation with coal in Canberra and Queensland now suggests intellectual incapacity as well.
    The Liberal party in Victoria is hung up on the state’s brown coal and wants to flog that overseas as well.
    Where will it all end?
    Hopefully, with the extinction of this version of the Liberal party.

  • If you have been in the solar industry over the past 10 years you understand supply and demand extremely well. Increasing supply on a product with falling international demand will only lead to more excuses in the future about how government modelling got it wrong and why we have to lift taxes to pay for that mistake, by the way the reef is not fit for tourists anymore either and who saw the 30 year drought coming?????
    Why is it that it is so clear to us common folk but still these stupid decisions make it through parliament?

  • michael

    Wasn’t Modi quoted in the paper today as assisting in trying to get the project up?

  • Thylacine

    Pure incompetence and total inconsistency with all this rhetoric about debt. Let’s see if Queensland itself becomes a stranded asset and if it does, perhaps the Indian or Chinese government will buy them out?

  • Alen T

    Giles, I got to say I just love the title!

  • Ron Horgan

    I cant quite grasp that the conservative government of Queensland is taking action to effectively nationalize the Queensland coal industry just in time to close it down and take the inevitable losses.
    Of course making a similar commitment to funding renewable energy would be unthinkable! What’s in the tea at the mad hatters party?

    • wideEyedPupil

      follow the money… federal ICAC now.

  • RobS

    Who would have thought that Liberal parties all over the country in 2014 would become the most voracious free market meddlers in Australian political history.

  • Barry

    isn’t the reason the LNP give for shutting down the Clean Energy Finance Corporation because it would fund projects that normal commercial banks wouldn’t touch with a barge pole? Looks like the Qld Govt are happy to fork out money for such projects when it suits them.

  • onesecond

    A question to the Australians: Does this stupidity at least affect how the COALition polls? Or does the public simply not get it? I mean, someone must have voted these idiots into office, but how on melting earth did that happen?

    • AJS

      Sadly. The current government decided to test the gullibility of the population. Appealing to the likes of farmers and low income earners with sensationalist propaganda. The majority voted how they thought was required and now we’re here. Scratching our heads about our decision.

    • Peter Billing

      Hard to say, really. A combination of factors. In opposition the current government had played a deliberately obstructionist hand, doing everything they could to prevent the government from achieving anything, so they could then turn around and call them a “do nothing” government.

      The previous government added more than a few own goals in there, too. For a start, they couldn’t sell a message if their life depended on it. They are fucking appalling communicators. They are utterly controlled by their factions, so a few powerful individuals basically control the leadership. There is very little correlation between their choice and a desirable choice for the rank and file of their own party, or for the public at large.

      The previous government also had a lot of internal problems, not least brought about by the fact that the leader and PM at the time, was trying to remove the power of the aforementioned factions. They got rid of him as soon as he lost some of his popularity with the public. The new PM was, shock horror, a woman. And an unmarried atheist to boot. The conservative right had conniptions. And, as a result of securing the support of the green party to form government she then agreed to implement an ETS, which she had, stupidly, ruled out before the election.

      Which brings us to the final reason. The labor party in Australia, who are supposed to be the progressive ones but just fucking aren’t, are so damn scared of saying anything meaningful that they allowed Abbott as opposition leader, to wedge them on everything. They supported the shameful treatment of asylum seekers and opposed marriage equality because they were too scared to stand up for what is right.

      TL:DR, Abbott didn’t win, Labor lost.

  • Chris Fraser

    This is worrying. Unlike Adani, GVK, Hancock, I can’t divest my shares in the Newman Government !

  • Alex

    The only possible conclusions that can be drawn are either gross corruption or gross stupidity. And I find it hard to believe that so many MPs could be THAT stupid.

    • wideEyedPupil

      ideology can substitute for both. when something has been done a certain way for a long time it becomes an unquestionable truth for most people, especially when lots of your mates have the question if livelihood at stake.

  • Miles Harding

    Another classic headline, worthy of the Mudrock press, Giles !

    Desperate, deeply in debt, morons are a lot more dangerous than ordinary morons. It would seem that this idiocy is an extension of the Newman government’s long held position of coal as their savior.

    This government is displaying an astounding level of ineptitude and incompetence by completely failing to take any heed of the present world conditions and direction that their beloved coal is going.

    Coal seems to be a major hangup for the COALition, no matter where they are located. I hope Victoria isn’t still intent on trying to sell their unsaleable brown (sooty rubbish) coal.

    In the same light, WA will have to do something about the worsening situation in Collie. Any forward thinking individual would see this as a clear signal to move to much more renewable generation in the WA grid, as this will extend the coal and ultimately allow it to be eliminated. But it’s more likely the (monumentally inept) Barnett government will choose to import Indonesian coal.

  • Grant Spork

    Our coal resources should be bundled with efficiency measures such as turbo charging fumes, and with carbon sequestration, algae farms. We are not bringing these technologies to the front which can make coal as competitive as gas and other energy forms.