Coal is a four-letter word for Labor/Green governments in Australia where it can’t be used in polite company. Thank goodness it can still be exported and its royalties used to fill the Treasury coffers of our governments.

Queensland is the latest state to benefit from soaring global demand and sky-high prices for our high-quality thermal and metallurgical coal. The coal industry is the goose that is laying the golden egg but Queensland Treasurer Cameron Dick is doing his best to strangle the poor fowl, just like his fellow Queenslander Jim Chalmers running the federal Treasury.

Last year Mr Dick imposed a new coal royalty rate regime which is the highest in the world. Yes, it yielded a bumper return this year, but as surely as night follows day, it will deter new investment. As Mrs Gina Rinehart observed in The Speccie last month, despite very high commodity prices, the investment in mining is much less than in the last mining boom a decade ago. High royalties, high taxes, sovereign risk, and red and green tape as far as the eye can see explain why companies are far more hesitant to invest in Australia these days.

Mr Dick is happy to crow about delivering the largest surplus of any Australian state government in the history of this country. Revenue from coal royalties more than doubled, soaring from $7.2 billion last year to $15.3 billion this -financial year.

Like Mr Chalmers, Mr Dick will use some of that revenue to cut the cost of electricity bills with government rebates. This is a testimony to the cloud-cuckoo land in which they live. Electricity prices wouldn’t be soaring if Australia wasn’t engaged in a reckless race to shut down its coal-fired power stations as soon as possible.

Federal Minister for Energy and Climate Change Chris Bowen never tires of telling anyone who will listen that wind and solar provide the cheapest energy. We should have guessed that Mr Bowen puts climate ahead of energy. He needs to take a trip to Denmark where around 50 per cent of electricity is supplied by wind and solar power and ponder why Denmark has some of the most expensive electricity in the EU. Here’s a hint. Wind and solar energy isn’t cheap once you include the cost of the subsidy provided by the sale of renewable energy certificates, and the costs of backing up intermittent power with dispatchable power to balance the grid when intermittent energy vanishes. And it isn’t cheap when you include the cost of transmissions lines.

It’s a sad day when Chinese communist dictator for life, Xi Jinping talks more sense on energy than Australian ministers. In 2020, Xi Jinping vowed to make China carbon-neutral by 2060, a decade later than Australia’s quixotic commitment. Then in 2021, China suffered huge power outages because its central government, like Australia’s, capped power prices. When costs rose power plants did the logical thing and cut supply rather than operate at a loss. But unlike in Australia, the Chinese government did a radical reality check. China relies on coal for more than half of its energy. Heeding a report from the Centre for Research on Energy and Clean Air which advised that technologies for storing clean energy are simply not yet mature enough to be deployed at the scale necessary to expand the use of renewable energy, Xi said that coal would remain a mainstay of China’s energy mix that would be hard to change in the short term. So while Australia hurries to close down its coal-fired power stations, local governments in China approved more new coal-fired power stations in the first three months of 2023 than in the whole of 2021, with more than 20 gigawatts of new plants approved.

To put that in context, Eraring, the largest coal-fired power plant in Australia, provides less than 3 gigawatts of power and authorities are rushing to shut it down in 2025, seven years earlier than planned.

Whatever the imagined benefit might be to the environment, it will be drowned in the increased emissions in China. But the scarcity of baseload power in Australia will drive up prices and provide a profit bonanza for energy generators, many of whom are foreign-owned. Australian power bills will go up, imposing pain on consumers and driving businesses broke or offshore. What we no longer produce we will have to import from countries like China and India. It makes no sense but it seems our governments are determined that we learn this lesson the hard way.

Voice cat out of the bag

The slide in support for an indigenous Voice over recent weeks has been striking, with a poll showing the Yes vote falling below 50 per cent.

This is hardly surprising. In certain states, the cat is already out of he bag. In Queensland treaties between the government and indigenous groups have been estimated to cost hundreds of millions of dollars whilst in Western Australia the government is introducing the Aboriginal Cultural Heritage Act. From 1 July, landowners with properties larger than 1100 square metres (a typical family block)  will be plunged into a bureaucratic nightmare. as they will be forced to apply for a permit for work on their land that may impact an Aboriginal cultural heritage site.

In addition to any other approvals, a building, swimming pool, road, fence, dam or mine will require a management plan to be developed with a local Aboriginal group. Welcome to what lies head unless we all say No to the Voice.