Coalition ministers seek to railroad CEFC into backing “clean coal”

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Turnbull government ministers rally to support PM’s vision of clean coal power generation in Australia, – financed by the CEFC.

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The federal Coalition has moved to cement its support of “clean coal” power generation, with two senior ministers confirming the party was considering using Australia’s green bank, the Clean Energy Finance Corporation, to back the controversial technology.

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In separate interviews on Thursday morning, Federal Treasurer Scott Morrison and energy minister Josh Frydenberg both said they would not rule out using money from the CEFC – a body designed largely to help finance large-scale renewable energy development and which the Coalition still intended to axe as recently as one year ago – to develop high efficiency, low emissions coal plants in Australia.

Talking to ABC Radio from South Australia, Frydenberg said the government was looking at all options on the matter of where to direct CEFC funds.

“But I do point out it’s called the Clean Energy Finance Corporation not the Renewable Energy Finance Corporation,” he added. “That’s an important distinction.”

Similarly, Morrison told the ABC on Thursday that coal was “a big part of the future under a Coalition government,” adding that this was “clearly …. not the case under the alternative.”

“It’s the Clean Energy Finance Corporation — it’s not the wind energy finance corporation,” Morrison said.

The comments follow the lead of the Prime Minister, who in his address to the National Press Club on Wednesday stressed that his party’s “technology agnostic” energy policy would include “state of the art clean coal-fired technology.”

“You’d think if anyone had a vested interest in doing smart things with clean coal it would be us wouldn’t it?” Turnbull said. “We really need to strip the ideology out of the debate.”

Of course, not everyone is picking up what the Coalition is putting down.

“Several authorities’ projections, including from the CSIRO, put the price of new coal at $80 a megawatt hour, and new wind and solar around the same level — but we are seeing lower prices achieved day by day [for wind and solar],” the Australian Industry Group’s principle national advisor Tennant Reed told ABC TV’s The Business.

Bloomberg New Energy Finance, meanwhile, has put the cost of a new coal power generator at closer to twice the above number – $160/MWh.

“The price of $80 a megawatt hour for clean coal power assumes a uniform cost of funding between wind, solar and coal and that’s simply not the case,” Bloomberg’s Kobad Bhavnagri said.

Interestingly, Labor’s shadow treasurer Chris Bowen, did not rule out supporting new coal power, but called for more detail on the proposed developments first.

“Cleaner coal can play a role but we need to see if there’s going to be a policy proposal to change the mandate of the CEFC or anything like that — we’d need to see a proposal,” he told Sky News.

Climate and energy spokesperson Mark Butler did, however, argue that a preference for coal over renewables would be both economically and environmentally more costly than going with renewables.

“While coal will remain part of our energy mix for the foreseeable future, everyone knows new investment in coal is ridiculously expensive and will push up power prices and push up pollution.”

South Australia’s state energy minister, Tom Koutsantonis, was less diplomatic, calling clean coal a “fairy tale” with no basis in reality.

“Clean coal is a myth being perpetrated by a Prime Minister who is clearly owned by the coal industry,” Koutsantonis said. “If clean coal was viable, then it would already be operating in the market – the fact is that it is not. Companies are not going to make a 50-year investment decision to build new coal-fired power stations when gas and renewable energy is cheaper and cheaper,” he said.

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32 Comments
  1. George Darroch 2 years ago

    Business as usual from the COALition.

    Bowen’s comments are concerning, because they don’t match the stated direction of the party. It’s disappointing to see him doing the ‘bi-partisan shuffle to nowhere’. Hopefully it represents nothing but waffle.

    • Peter F 2 years ago

      Butler is just not wasting his time on a fight of no consequence. $80/MWhr for new coal is a myth. All the generators have lined up to say they won’t build new coal and if Bloomberg is right about the costs and I think they are pretty close, and David Leitch is right about next year coal cost in NSW, there is going to be a mad rush by the retailers for wind and solar because it will be cheaper than even current coal. The fastest way for retailers to get more solar is to increase their solar FIT, particularly during peak times. If they increase the FIT to 9c they make solar installation a no brainer and don’t bear any of the capital costs

  2. Kevfromspace 2 years ago

    Good to see Tom Koutsantonis speak some truth to these fools. Shame he can’t see the light when talking about expensive gas in his own state. He’s got the gas blinders on.

    • Rod 2 years ago

      I’m afraid the Gentailers have us by the short and curly’s so not much SA can do other than try to encourage storage and or another interconnector.

      Our fate was sealed when ETSA was privatised without considering adequate competition

      • Kevfromspace 2 years ago

        What about encouraging Concentrating Solar Power? Their recent tender for new projects was effectively asking for new gas. You’re right though, there’s only so much they can do with the lack of competition and the current set AEMO market rules (which of course heavily favour entrenched interests like coal and gas).

        • Rod 2 years ago

          I think with all the heat they are getting they were forced into gas rather than concentrated solar. Pity because it sounds like Port Augusta wants it..
          Your average punter would think RE = more blackouts.

      • Peter F 2 years ago

        You don’t need another interconnector you need a new competitor plus more wind/solar + a bit of storage.
        National grid is installing 200 MW of storage for A$150m.
        Hawaii is installing solar + storage and supplying it for US$110MWhr. Solar Reserve is doing CST+ for about US$95/MWhr in Chile.
        Plus sized grid controlled hot water systems store heat for about $30/KWhr of capacity or $30,000 per MWhr.
        DC connected solar panels to hot water is cheaper an more reliable than gas or even heat pump electric.
        Rebates to encourage replacement of old A/C and fridges with new will also reduce demand
        A requirement for all new builds renovations to be seven star further slows demand.
        If the SA government rolled all these ideas into an energy saving package available to households, business and even distributors and generators with a subsidy of $150-200/kW. Installed over ten years for about $200-300m you could backup SA’s entire demand.

        • Rod 2 years ago

          Yes, an interconnector wouldn’t be my first choice. Electranet were doing a feasibility study SA-NSW. Rough estimate 2.2 Billion!
          My short term preference would be single axis tracking utility scale PV in places like Pt Augusta and on the Eyre Peninsular. Mainly due to the quick build time, value and the ability to shave the morning and early evening peaks.

        • Greg Hudson 2 years ago

          Just make PV mandatory on all new builds.

  3. Jason Van Der Velden 2 years ago

    Cefc cant finance an entire poject right? Even with a subsidy, whos gonna build such a power station?

    • MG 2 years ago

      In the AFR this morning AGL said they have a policy against building more coal, Origin said they have no interest in more coal assets, and EnergyAustralia said coal is a legacy technology that investors don’t want to fund.

      • Greg Hudson 2 years ago

        Superannuation fund managers are also divesting themselves of FF assets as well… The smart money is no longer supporting coal.

        • lin 2 years ago

          Not too many people put this government in the smart camp. They are happy to waste our money for political purposes.

  4. Robert Comerford 2 years ago

    If I didn’t hear it I would not believe such a statement could be made.
    Use the clean energy fund to build more polluting power stations !?
    If ever there was an inappropriate use of funds.
    If the opposition don’t attack this nonsense instead of worrying what Malfunction does with his own money they deserve to go the way of the dinosaurs too.

  5. DevMac 2 years ago

    I’ve got some clean underwear I’d like to sell to these fools.

    Also, this is from Wikipedia:
    “Of the 22 clean coal demonstration projects funded by the U.S. Department of Energy since 2003, none are in operation as of mid-2016, having been abandoned or delayed due to capital budget overruns or discontinued because of excessive operating expenses”

    “Clean Coal” sounds like “Polished Turd”.

    • Marko Simatkovich 2 years ago

      Haha, so polished it shines!

  6. Chris Fraser 2 years ago

    So, if ‘clean coal’ can’t compete with any renewable technology when comparing either costs or emissions per MWh, then their ideological preference for coal comes from their donors, or their preference for unswitchable coal over storage … they make the mind boggle.

    • Greg Hudson 2 years ago

      The sooner party funding is transferred from donors to the Govt, the sooner we would lose all these companies bribing ministers. And, while we are at it, make lobbyists illegal as well. At least in the US they are ‘registerd’ (not a spelling error) 😉

  7. Rod 2 years ago

    Wow Tom, way to call a call shovel a coal shovel.

  8. Andy 2 years ago

    How can Turnbull say on one hand that they are ‘all about jobs, and innovation’ and then a day later Frydenburg make statements like ‘technology neutral’ with regard to energy generation, AND strip a fund that had as its intention, to promote new ways to generate/distribute power.
    The statement by Frydenburg (reported in ABC) ‘technology neutral’ is like ‘innovation negative’.
    What a massive opportunity for jobs and innovation has passed by Australia with this mob. (ie, we should be at the forefront of these renewable technologies, not the forefront of coal technologies)

  9. Andy 2 years ago

    Could Sophie please start a topic fully explaining “clean coal”, (as far as the LNP definition of the term, how is it clean, who /where else uses the tech, conversion of existing plant , etc) as its going to be LNP flavour of the year.

  10. howardpatr 2 years ago

    How will Turnbull’s children and grandchildren comprehend his hypocrisy on anthropogenic climate change?

    Day by day the LNP’s many RWRNJs make him look like an utter fool which of course he is not.

    Guess his ego and need for “power” and his payment of $1.75 million might help explain his embarrassing utterance on the renewable energy future and his new hope for “clean coal”..

  11. trackdaze 2 years ago

    Clean”er” coal! Mr frydenbog?
    Sounds like 97% fat free loaded with sugar talk to me.

    How can one be technology agnostic when all the coalition talk about is coal.

  12. brucelee 2 years ago

    Opposition need to start calling it what it is. Continuing to use the “Clean Coal” label perpetuates the myth. It needs to be denounced publicly as “Less Filthy Coal” or something equally as Catchy

  13. DevMac 2 years ago

    Quoting from a previous RE article (located here: https://reneweconomy.com.au/clean-coal-power-not-answer-australias-emissions-targets-92320/ )

    Energy Minister Josh Frydenberg told ABC radio on Tuesday that “ultra-supercritical coal-fired power plants actually drive down the carbon footprint by up to 40%”.

    So, let’s fund research into bolt-ons to centuries old power technology that, whilst expensive and as-yet relatively unproven, and even if it works as intended, still produces a minimum of 60% of the emissions as without the expensive, bolt-on, as-yet-unproven technology.

    And this is from the party with the (ironic) reputation of being better at managing Australia’s economy.

    Put the money into renewables and power storage for sanity’s sake.

  14. aussiearnie 2 years ago

    For the CEFC to invest in (not subsidise!) a project they need to comply with the Investment Mandate Direction (2) of December 2015. To do that, they need to “adopt an average return of at least the five–year Australian Government bond rate + 4 to + 5 per cent per annum as the benchmark return of the portfolio.” Bond rate is around 2.3% at the moment, so they need to achieve a return of at least 6.3% over five years. Good luck with that. Also, they must “must include a focus on supporting emerging and innovative renewable technologies and energy efficiency, such as large scale solar, storage associated with large and small-scale solar, offshore wind technologies, and energy efficiency technologies for cities and the built environment.” For all the crying that it is about “clean” not “renewable”, I don’t see coal included anywhere. But of course the Minister can go ahead and change the mandate…

  15. Radbug 2 years ago

    I think that the directors of the CEFC could be charged with breach of fiduciary duty if they funded USC only to find, a couple of years down the track, that renewables had rendered their massive investment stranded and a massive loss-maker, requiring the government to rig power prices upwards to maintain its profitability, and all this on top of the price rigging to render the “gold plating” of the grid profitable.

  16. Richie 2 years ago

    For my next climate protest I’m going to carry a placard.
    One side says
    CLEAN
    COAL
    IS
    CRAP
    And the other will say

    CARBON
    CAPTURE
    IS A
    CROCK

  17. larry w 2 years ago

    Coal is the dark satanic mill of the 18th century. Clean coal is like uranium for peace. The promotion of clean coal is obvious corruption of our democracy. As it confounds rational analysis. Clean coal is rejected by members of the status quo, not just hermits living in the wilderness, god bless them.

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