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Columnists Australia

Business/Robbery etc

It’s time for ‘unethical’ coal to fight back

1 August 2015

9:00 AM

1 August 2015

9:00 AM

At last Australia’s beleaguered coal industry has something going for it. After being labelled unethical by Sydney’s Anglican church and a couple of equally precious universities that have decided to divest themselves of shares in this dirty fossil fuel, under constant attack from the Greens, vilified for wanting to mine some non-cultivated hills near the fertile Liverpool Plains and maybe disturbing the water table (another good populist platform for Alan Jones), damned for its CO2 emissions that (‘the science is settled’) cause global warming, criticised for wanting to export coal to India from Abbott Point (the name is bad enough!), assailed by gas and oil rivals as ‘the enemy’ while mocking the concept of ‘clean coal’ and its death knell being sounded by the ABC in welcoming, in what passed for analysis in its opinionated 4 Corners program, ‘The End of Coal’, it is time for coalmining to fight back.

The ABC’s reports of coal’s death are premature; its wishful thinking that technological change risks Australia ‘backing a loser’ by sticking with coal as ‘our biggest customers are turning to alternative energy’ does not fit comfortably with the reality that even with the end of the mining boom, coal production and exports continue to rise—and are officially forecast to continue to do so.

Coal is no ‘dying energy source whose use is being phased out’. The ABC’s requiem for coal has been rudely interrupted by the latest statistics from the Department of Industry and Science which show not only a respectable 4.2 per cent rise in production of metallurgical coal (which goes to make steel) to 188 million tonnes in 2014-15, but also predicts a further rise of almost 3 per cent in the current financial year. And for thermal coal (that is burned for electricity and is the real subject of ABC/Green philosophical hatred), a modest rise of almost one per cent to 246 million tonnes is forecast to increase by 1.4 per cent in 2015-16.


So despite falling world prices, Australia continues to export more coal than ever before. And the composition of those exports dramatises why the coal debate in Australia is so ill-informed. While the ABC dealt with coal as if its only task was to generate power, the reality is that steel-making ‘metallurgical’ coal, which cannot be replaced by wind, solar or other ‘renewables’, earns 40 per cent more export income ($22 billion) than the steaming coal that its supporters, like Tony Abbott, say is needed to provide the cheap source of power necessary to ease third world poverty. Yet the ABC focussed, in its ill-researched 4 Corners, entirely on the thermal product, because that is the enemy of the renewable energy dogma.

But it is not only Australia that faces continuing increases in coal production despite the (heavily subsidised) growth of renewable energy. Massive increases in Asian demand for coal are forecast by the International Energy Agency. Within 10 years, India’s electricity generation is projected to exceed the combined current output of Japan, South Korea and Australia, with a tripling of modest wind and solar but with coal providing the great bulk of the rise. And while Indonesia is currently India’s main supplier, Australia’s higher quality lower-emissions thermal coal is the reason Indian power suppliers are keen to invest in Australian coal. Much of the smog that shrouds Asian cities at present comes less from carbon dioxide than from sulphur and ash emissions from the low-grade coal Australia could replace.

While China’s overall coal consumption will slow to a more modest rise, other Asian countries like Malaysia, Thailand, Taipei, Bangladesh and Pakistan are together expected to be bigger importers than China. And now that Australian coal prices have retreated from their boom peaks that priced them out of so many Asian markets (like India), the opportunities for coal exports in the region would not suit the ABC’s prejudices.

It’s time to resist the anti-coal verbal bullying that now infests social media. A strong coal industry adapting itself to changing technology, will continue to be in Australia’s best interests for many years: Tweets like ‘Coal was a necessary evil, but now it is no longer necessary’ is a prime example of how programs like 4 Corners distort what should be a debate of real substance for all Australians.

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