A massive $1.93 billion in gas and coal development subsidies promised by the ousted Australian Liberal Party coalition should be realocated in October’s federal budget, and redirected by the Labor Party to the renewables sector to help meet the country’s climate goals, environmentalists say.
The Parliamentary Budget Office analysis of former Liberal Party gas subsidy announcements under former Prime Minister Scott Morrison has revealed $1.9 billion in public funds that were not formally committed for 24 projects in varying stages of development.
The analysis, commissioned by the Greens Party based on investigations by 350.org will form the basis of campaigns by the Greens and environment groups calling on Labor Party Prime Minister Anthony Albanese to reallocate the remaining funding to renewable investment in the budget.
For now, these “zombie” subsidies remain allocated to opening up new coal and gas basins, new plants, import terminals, new petrochemical factories and carbon capture and storage programs.
“Public money should not fund coal and gas,” Greens leader Adam Bandt said.
“Labor’s first Budget must kill off Morrison’s $2 billion coal and gas zombie handouts, including the $23 million remaining to open up the NT’s Beetaloo basin,” Bandt said, referring to the massive gas fracking project gearing up for development in the Northern Territory.
Gas subsidies already spent include $7.5 million allocated to Tamboran Resources which, RenewEconomy this week reported has agreed to buy out Origin Energy’s majority financial stake in Beetaloo.
Origin has pitched its exit from Beetaloo as a major step in the greening of the energy giant, though the sale to Tamboran would see Origin purchase up to 36.5 petajoules of gas from the project annually for 10 years.
Development of Beetaloo alone could lift Australia’s total emissions by up to 11 percent at a time when the country is striving to meet its net zero commitments, critics warn.
“Origin’s decision yesterday to withdraw from fracking projects in the Northern Territory is further evidence of the speculative and volatile nature of Australia’s gas industry,” Lock the Gate national co-ordinator Ellen Roberts said.
“Gas companies are holding out their hands for subsidies for gas projects that will yield only a handful of jobs and damage water and land.”
The upcoming budget is seen as a chance for the Albanese government to further distance itself from the legacy policies of the previous administration and put a fresh stamp on Australia’s future energy strategy.
“The Albanese government has an opportunity to put an end to this wasteful spending and make sure no further handouts are given to gas billionaires,” said Shani Tager, senior campaigner at 350.org.
Australia has committed to slash carbon emissions by 43 per cent under a climate bill this month that passed its final parliamentary hurdle this month.
Still, government-backed fossil fuel subsidies remain deeply embedded in Australia’s resources sector.
The Australia Institute estimates that in the 2021-22 budget period, existing Australian federal and state governments’ total fossil fuel subsidies cost A$11.6 billion — up $1.3 billion on the previous year.
In the waning days of the Morrison government, the total value of future fossil fuel subsidies already committed in federal, state and territory budgets stood at $55.3 billion – more than 10 times the balance of Australia’s Emergency Response Fund.
