Coalition wants to build 1.2GW coal plant, using climate funds

The Turnbull Coalition government has kicked off its informal re-election campaign by repeating its desire to build a massive coal fired power station in north Queensland, only this time it proposes to use climate funds to help pay for the project.

In confirmation that little has changed in the switch from the Abbott to the Turnbull regimes, Queensland MP Ewen Jones became the latest member of the Coalition to outline the federal  government’s plan for future energy innovation: more fossil fuels.

On the same day as a compelling economic case for shifting Australia to 100 per cent renewable energy is published, and just days ahead of Australia signing the Paris climate agreement, Jones suggested that the government could use funds from Direct Action, as well as the Clean Energy Finance Corporation and the northern Australian infrastructure fund, to support development of a 1.2GW coal-fired generator in north Queensland.

Ignore for a moment the fact that Australia already has a surplus of nearly 7,000MW of coal-fired capacity, and the carbon emissions impact of adding yet more, Jones argued that a coal-fired power station was critical to address unemployment issues around Townsville.

“The one thing we can’t do in North Queensland is develop our industrial base, because the cost of power is just so huge,” Jones told the Q&A audience on Monday night.

“If, through using Direct Action …and the clean energy finance corporation and private money we can develop a power plant or a power station (to power the planned Adani Carmichael coal mine) of 1.2GW and make it a super efficient, or an ultra-efficient, ultra-critical power plant, we can then bring the $5 billion concessional loan facility on developing the north of Australia that can build the poles and wires, which will be a saleable asset, to bring that power to the national energy market.”

Leaving aside the obvious contradiction of using federal government funds allocated to fight climate change and to finance renewable energy to build a coal plant to power a coal mine, it sounds like a great plan – just not one for this century.

For a more 21st Century approach to the problems of future energy supply in a world that is committed to curbing dangerous global warming, the Coalition need only take a look at the Institute for Sustainable Futures in Sydney report, released on Tuesday.

The report, which was commissioned by GetUp and Solar Citizens, models a scenario where not just electricity, but also all transport and heat used by Australian industry, is transitioned to 100% renewable energy by 2050.

The study found that making this shift would cost about $800 billion between now and 2050. And while that amounts to about $650 billion more than continuing with the status quo, this cost is more than cancelled out by removing the need for fossil fuels, and thus saving the economy up to $740 billion; a total saving of $90 billion over the period to 2050.

In short, fuel cost savings would cover 110 per cent of the capital investment required to transition the economy.

At least John Hewson, a former leader of the Liberal Party leader and an economist, gets it. As he told the Q&A audience on Monday night, “the Adani Carmichael mine is a massive mistake for this country” – both economically and from the point of view of climate change.

“The climate change numbers are that about 75 per cent of known coal reserves today cannot ever be mined (if we’re going to meet climate targets),” Hewson said.

“So to contemplate opening a large new mine simply for the benefit of exporting that coal to India, it boggles my mind.

“Having said that I think there are some interesting projects around in North Queensland,” he added, pointing to a project in the region he had been working on for the last couple of years, which was helping the sugar cane industry diversify, by keeping the waste the gas from the sugar cane and using it to generate 100 per cent renewable electricity.

“You can have a game changer in the sugar industry by a simple application of technology. I think that’s where a big future exists for northern Australia, is applying technology. And you can have a lot of renewable energy generated in the sugar industry all the way down the coast if you just apply that simple model.

“The model we have is you build a plant a mill that’s about a 100-year life, you pay back all the debt and equity under that model in 25 years and the family get to own it…for the next 75 years, pass it on to your family.

“These are solutions that have got economic benefit, obviously jobs and growth, but equally very significant social benefits, and they keep families together, they keep the industry going, they rejuvenate a town like Townsville.”

And just to top of the issue about a market for Camichael coal, the Indian energy minister this week repeated his intention to bring an end to coal imports into India. He says doing so would save the country $8 billion a year.