tag:theconversation.com,2011:/id/topics/thermal-coal-4891/articlesThermal coal – The Conversation2021-01-19T19:08:03Ztag:theconversation.com,2011:article/1533002021-01-19T19:08:03Z2021-01-19T19:08:03ZForget about the trade spat – coal is passé in much of China, and that’s a bigger problem for Australia<figure><img src="https://images.theconversation.com/files/379389/original/file-20210119-28-11y8gmr.jpg?ixlib=rb-1.1.0&rect=0%2C0%2C1892%2C1274&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Greg Baker/AP</span></span></figcaption></figure><p>Australian coal exports to China plummeted last year. While this is due in part to recent trade tensions between Australia and China, our research suggests coal plant closures are a bigger threat to Australia’s export coal in the long term.</p>
<p>China unofficially banned Australian coal in mid-2020. Some 70 ships carrying Australian coal have <a href="https://www.smh.com.au/business/the-economy/beijing-rebuffed-pleas-from-chinese-steelmakers-to-lift-ban-on-australian-coal-20210114-p56u0c.html">reportedly been unable</a> to unload in China since October.</p>
<p>This is obviously bad news for Australia’s coal exporters. But even if the ban is lifted, there’s no guarantee China will start buying Australian coal again – at least not in huge volumes.</p>
<p>China is changing. It’s announced a firm date to reach net-zero emissions, and governments in eastern provinces don’t want polluting coal plants taking up prime real estate. It’s time Australia faced reality, and reconsidered its coal export future.</p>
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<img alt="Coal ship unloads at Chinese port" src="https://images.theconversation.com/files/379386/original/file-20210119-15-nbxmi3.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/379386/original/file-20210119-15-nbxmi3.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/379386/original/file-20210119-15-nbxmi3.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/379386/original/file-20210119-15-nbxmi3.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/379386/original/file-20210119-15-nbxmi3.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/379386/original/file-20210119-15-nbxmi3.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/379386/original/file-20210119-15-nbxmi3.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">China’s coal import quotas are hurting Australian exporters.</span>
<span class="attribution"><span class="source">Wang Kai/AP</span></span>
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<h2>First, the coal ban</h2>
<p>In May last year, China’s government effectively banned the import of Australian coal, by applying <a href="https://www.abc.net.au/news/2020-05-24/what-do-chinas-new-regulations-mean-for-australia/12280396">stringent import quotas</a>. As of last month coal exports to China from Newcastle, Australia’s busiest coal exporting port, had <a href="https://www.abc.net.au/news/2020-12-16/will-other-countries-replace-china-buying-australian-coal/12985956">ceased</a>. </p>
<p>In 2019, Australia exported <a href="https://www.abc.net.au/news/2020-12-16/will-other-countries-replace-china-buying-australian-coal/12985956">A$13.7 billion</a> worth of coal to China. This comprised A$9.7 billion in metallurgical coal for steel making and A$4 billion in thermal coal for electricity generation. </p>
<p>The latest official Australian <a href="https://www.abs.gov.au/statistics/economy/international-trade/international-merchandise-trade-preliminary-australia/nov-2020#exports">data</a> shows these export levels fell dramatically between November 2019 and November 2020. Comparing the two months, metallurgical and thermal coal exports to China were down 85% and 83% respectively.</p>
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Read more:
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<p>Several Chinese provinces experienced power blackouts in late 2020. China’s state-backed <a href="https://www.globaltimes.cn/content/1210355.shtml">media</a> said the shortages were unrelated to the ban on Australian coal. Instead, they <a href="https://www.globaltimes.cn/content/1210598.shtml">blamed</a> cold weather and the recovery in industrial activity after the pandemic.</p>
<p>We dispute this claim. While Australian coal accounts for only <a href="https://www.globaltimes.cn/content/1210355.shtml">about 2%</a> of coal consumption in China, it helps maintain reliable supply for many power stations in China’s southeast coastal provinces.</p>
<p>Coal mining in China mostly occurs in the western provinces. Southeast coastal provinces are largely economically advanced and no longer produce coal. Instead, power stations in those provinces import coal from overseas. </p>
<p>This coal is cheaper than domestic coal, and often easier to access; <a href="https://www.spglobal.com/platts/en/market-insights/latest-news/natural-gas/122420-china-takes-measures-to-resolve-power-shortages-but-impact-on-lng-limited">transport bottlenecks</a> in China often <a href="http://www.xinhuanet.com/english/2021-01/08/c_139652820.htm">hinder</a> the movement of domestic coal.</p>
<figure class="align-center ">
<img alt="Coal mine at Gunnedah in NSW" src="https://images.theconversation.com/files/379391/original/file-20210119-23-8sn7nm.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/379391/original/file-20210119-23-8sn7nm.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=403&fit=crop&dpr=1 600w, https://images.theconversation.com/files/379391/original/file-20210119-23-8sn7nm.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=403&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/379391/original/file-20210119-23-8sn7nm.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=403&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/379391/original/file-20210119-23-8sn7nm.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=507&fit=crop&dpr=1 754w, https://images.theconversation.com/files/379391/original/file-20210119-23-8sn7nm.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=507&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/379391/original/file-20210119-23-8sn7nm.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=507&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Australian thermal coal helps supplement China’s domestic supply.</span>
<span class="attribution"><span class="source">Rob Griffith/AP</span></span>
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<h2>Beyond the trade tensions</h2>
<p><a href="https://www.washingtonpost.com/business/energy/chinas-coal-import-ban-has-more-bark-than-bite/2020/10/12/48f7942a-0d07-11eb-b404-8d1e675ec701_story.html">Experience suggests</a> trade tensions between Australia and China will eventually ease. But in the long run, there is a more fundamental threat to Australian coal exports to China.</p>
<p>Data from monitoring group <a href="https://endcoal.org/global-coal-plant-tracker/">Global Coal Tracker</a> shows between 2015 and 2019, China closed 291 coal-fired power generation units in power plants of 30 megawatts (MW) or larger, totalling 37 gigawatts (GW) of capacity. For context, Australia decommissioned <a href="https://onlinelibrary.wiley.com/doi/abs/10.1111/1467-8489.12289">5.5 GW</a> of coal-fired power generation units between 2010 and 2017, and currently has 21 GW of coal-fired power stations.</p>
<p>The closures were driven by factors such as climate change and air pollution concern, excess coal power capacity, and China’s move away from some energy-intensive industries. </p>
<p>Our recently published <a href="https://www.sciencedirect.com/science/article/abs/pii/S0301421520307692?dgcid=author">paper</a> revealed other distinctive features of the coal power station closures.</p>
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Read more:
<a href="https://theconversation.com/the-paris-agreement-5-years-on-big-coal-exporters-like-australia-face-a-reckoning-151915">The Paris Agreement 5 years on: big coal exporters like Australia face a reckoning</a>
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<p>First, China’s regions are reducing coal power capacity at different rates and scales. In the nation’s eastern provinces, the closures are substantial. But elsewhere, and particularly in the western provinces, new coal plants are being built.</p>
<p>In fact, China’s coal power capacity increased by about 18% between 2015 and 2019. It currently has more than 1,000 GW of coal generation capacity - the largest in the world.</p>
<p>Second, we found retired coal power stations in China had much shorter lives than the international average. Guangdong, an economically developed region of comparable economic size to Canada, illustrates the point. According to <a href="https://www.sciencedirect.com/science/article/abs/pii/S0301421520307692?dgcid=author">our calculation</a>, the stations in that region had a median age of 15 years at closure. In contrast, coal plants that closed in Australia between 2010 and 2017 had a median age of <a href="https://onlinelibrary.wiley.com/doi/abs/10.1111/1467-8489.12289">43 years</a>. </p>
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<img alt="coal plant in China" src="https://images.theconversation.com/files/379385/original/file-20210119-13-15r7bz5.jpg?ixlib=rb-1.1.0&rect=0%2C0%2C3988%2C2221&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/379385/original/file-20210119-13-15r7bz5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=338&fit=crop&dpr=1 600w, https://images.theconversation.com/files/379385/original/file-20210119-13-15r7bz5.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=338&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/379385/original/file-20210119-13-15r7bz5.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=338&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/379385/original/file-20210119-13-15r7bz5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=424&fit=crop&dpr=1 754w, https://images.theconversation.com/files/379385/original/file-20210119-13-15r7bz5.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=424&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/379385/original/file-20210119-13-15r7bz5.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=424&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Coal plant closures have been most marked in China’s east.</span>
<span class="attribution"><span class="source">AP</span></span>
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<p>This suggests coal power stations in China are usually retired not because they’ve reached the end of their productive lives, but rather to achieve a particular purpose.</p>
<p>Third, our study showed decisions to decommission coal power stations in China were largely driven by government, especially local governments. This is in contrast to Australia, where the decision to close a plant is usually made by the company that owns it. And this <a href="https://link.springer.com/book/10.1057/9781137546258">decomissioning</a> in China is usually driven by a development logic. </p>
<p>Coal plant closures there have been faster and bigger than elsewhere in the country, as governments replace energy- and pollution-intensive industries with advanced manufacturing and services. </p>
<p>And as these regions become richer, the value of land occupied by coal power plants and transmission facilities grows. This gives governments a strong incentive to close the plants and redevelop the sites. </p>
<p>In coming years, southeast China will increasingly shift to renewable-based electricity and electric power transmitted from western provinces. </p>
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<img alt="Man covers mouth" src="https://images.theconversation.com/files/379393/original/file-20210119-21-1o2pl02.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/379393/original/file-20210119-21-1o2pl02.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/379393/original/file-20210119-21-1o2pl02.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/379393/original/file-20210119-21-1o2pl02.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/379393/original/file-20210119-21-1o2pl02.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=502&fit=crop&dpr=1 754w, https://images.theconversation.com/files/379393/original/file-20210119-21-1o2pl02.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=502&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/379393/original/file-20210119-21-1o2pl02.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=502&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Air pollution concerns are helping drive China’s move away from coal-burning for power.</span>
<span class="attribution"><span class="source">Ng Han Guan/AP</span></span>
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<h2>Securing our energy future</h2>
<p>Coal power stations in China’s eastern coastal regions will continue to close in coming years, and power generation capacity will be redistributed to western provinces. For reasons outlined above, that means power generation in China will increasingly rely on domestic coal rather than that from Australia.</p>
<p>China’s coal exit is in part due to its strategy to <a href="https://www.reuters.com/article/un-assembly-climatechange/china-pledges-to-achieve-co2-emissions-peak-before-2030-carbon-neutrality-before-2060-xi-idUSL2N2GJ105">peak</a> its carbon emissions before 2030 and achieve <a href="https://theconversation.com/china-just-stunned-the-world-with-its-step-up-on-climate-action-and-the-implications-for-australia-may-be-huge-147268">net-zero by 2060</a>. Australia must realistically appraise its coal export prospects in light of the long-term threat posed by shifts in China and other East Asian nations. </p>
<p>The Morrison government, and industry, should re-double efforts to rapidly expand renewable energy in Australia. Then we can leave coal behind, and emerge as a renewable energy superpower.</p>
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Read more:
<a href="https://theconversation.com/want-an-economic-tonic-mr-morrison-use-that-stimulus-money-to-turbocharge-renewables-137074">Want an economic tonic, Mr Morrison? Use that stimulus money to turbocharge renewables</a>
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<img src="https://counter.theconversation.com/content/153300/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Hao Tan receives funding from the Australia Research Council (ARC) Discovery Project 2019-2021; and funding from Enova Community Energy Ltd for its Shared Community Battery Project. He previously received funding from the Academy of the Social Sciences in Australia, and funding from the Confucius Institute Headquarters under the "Understanding China Fellowship" in 2017.</span></em></p><p class="fine-print"><em><span>Elizabeth Thurbon currently receives funding from the Australian Research Council (ARC) and the Academy of Korean Studies. She has previously received funding from the Academy of Social Sciences in Australia and the Korea Foundation. She is an elected member of the Executive Council of the Society for the Advancement of Socio-Economics (SASE) and a Research Committee and Board member of the Jubilee Australia Research Centre (JARC).</span></em></p><p class="fine-print"><em><span>John Mathews receives funding from the Australian Research Council</span></em></p><p class="fine-print"><em><span>Sung-Young Kim receives funding from the Australia Research Council (ARC) and has previously received funding from the Academy of Korean Studies (AKS). He is Chair of the Organising Committee for the 2021 Australian Political Studies Association (APSA) Annual Conference and is Treasurer of the Korean Studies Association of Australasia (KSAA).</span></em></p>China is changing, and it’s time Australia’s coal exporters faced up to this reality.Hao Tan, Associate professor, University of NewcastleElizabeth Thurbon, Scientia Associate Professor in International Relations / International Political Economy, UNSW SydneyJohn Mathews, Professor Emeritus, Macquarie Business School, Macquarie UniversitySung-Young Kim, Senior Lecturer in International Relations, Discipline of Politics & International Relations, Macquarie School of Social Sciences, Macquarie UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1415312020-07-02T20:09:40Z2020-07-02T20:09:40Z45,000 renewables jobs are Australia’s for the taking – but how many will go to coal workers?<figure><img src="https://images.theconversation.com/files/345191/original/file-20200702-2702-13hn8wv.jpeg?ixlib=rb-1.1.0&rect=38%2C0%2C5163%2C3470&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Dan Himbrechts/AAP</span></span></figcaption></figure><p>As the global renewables transition accelerates, the future for coal regions has become a big worry. This raises an important question: can renewables create the right jobs in the right places to employ former coal workers?</p>
<p>According to our <a href="https://www.uts.edu.au/research-and-teaching/our-research/institute-sustainable-futures/our-research/energy-futures/renewable-energy-employment-australia">new research</a>, the answer in many cases is “yes”. Renewable energy jobs provide a good match for existing coal jobs across a range of blue and white-collar occupations, including construction and project managers, engineers, electricians, site administrators and mechanical technicians. </p>
<p>But about one-third of coal workers, such as drillers and machine operators, cannot simply switch over to renewables jobs. So as our economy pivots to renewables, planning and investment is needed to help coal regions survive. </p>
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<img alt="" src="https://images.theconversation.com/files/345193/original/file-20200702-2692-2mr6f.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/345193/original/file-20200702-2692-2mr6f.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=369&fit=crop&dpr=1 600w, https://images.theconversation.com/files/345193/original/file-20200702-2692-2mr6f.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=369&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/345193/original/file-20200702-2692-2mr6f.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=369&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/345193/original/file-20200702-2692-2mr6f.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=464&fit=crop&dpr=1 754w, https://images.theconversation.com/files/345193/original/file-20200702-2692-2mr6f.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=464&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/345193/original/file-20200702-2692-2mr6f.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=464&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Some renewables jobs could be filled by coal workers.</span>
<span class="attribution"><span class="source">Tim Wimbourne/AAP</span></span>
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<h2>Renewables jobs: a snapshot</h2>
<p>Our research, commissioned by the Clean Energy Council, is <a href="https://www.uts.edu.au/research-and-teaching/our-research/institute-sustainable-futures/our-research/energy-futures/renewable-energy-employment-australia">the first large-scale survey of renewable energy employment</a> in Australia.</p>
<p>We surveyed more than 450 Australian renewable energy businesses, covering large scale wind, solar and hydro, rooftop solar and batteries. We wanted to find out how many people were employed, and in what jobs. </p>
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Read more:
<a href="https://theconversation.com/australias-devotion-to-coal-has-come-at-a-huge-cost-we-need-the-government-to-change-course-urgently-140841">Australia's devotion to coal has come at a huge cost. We need the government to change course, urgently</a>
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<p>We then projected employment until 2035 using <a href="https://www.aemo.com.au/-/media/Files/Electricity/NEM/Planning_and_Forecasting/ISP/2019/Draft-2020-Integrated-System-Plan.pdf">three scenarios</a> for the future of the electricity market, developed by the Australian Energy Market Operator (AEMO).</p>
<p>Our results suggest renewable energy can be a major source of jobs in the next 15 years. But the trajectories are very different depending on government COVID-19 stimulus measures and wider energy policy.</p>
<h2>Policy crossroads</h2>
<p>We found the renewable energy sector currently employs about 26,000 people. Temporary construction and installation jobs now comprise 75% of the renewable energy labour market, but as the sector grows, this will change (more on that later).</p>
<p>Australia’s renewable energy target was reached last year, and has not been replaced. According to the <a href="https://www.rba.gov.au/publications/bulletin/2020/mar/renewable-energy-investment-in-australia.html">Reserve Bank of Australia</a> this caused renewables investment to fall by 50% last year compared to 2018. Under a “central” scenario where these policies continued, 11,000 renewable jobs would be lost by 2022. </p>
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<img alt="" src="https://images.theconversation.com/files/345197/original/file-20200702-2674-ww84u5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/345197/original/file-20200702-2674-ww84u5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=382&fit=crop&dpr=1 600w, https://images.theconversation.com/files/345197/original/file-20200702-2674-ww84u5.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=382&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/345197/original/file-20200702-2674-ww84u5.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=382&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/345197/original/file-20200702-2674-ww84u5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=480&fit=crop&dpr=1 754w, https://images.theconversation.com/files/345197/original/file-20200702-2674-ww84u5.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=480&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/345197/original/file-20200702-2674-ww84u5.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=480&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Under the right policies, there could be an average of 35,000 renewables jobs annually in Australia until 2035.</span>
<span class="attribution"><span class="source">Michael Buholzer/Reuters</span></span>
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</figure>
<p>We then examined a “step change” scenario where Australian policy settings were in line with meeting the Paris climate agreement. This would create a jobs boom: renewable energy employment would grow to 45,000 by 2025 and average around 35,000 jobs each year to 2035. Up to two-thirds are in regional areas.</p>
<p>Under all scenarios, job growth is strongest in rooftop solar and wind. Most are in the construction and installation phase, comprising both ongoing and project-based jobs in trades, as well as technicians and labourers. But by 2035, as many as half of renewable energy jobs could be ongoing jobs in operation and maintenance. </p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/people-need-to-see-the-benefits-from-local-renewable-energy-projects-and-that-means-jobs-138433">People need to see the benefits from local renewable energy projects, and that means jobs</a>
</strong>
</em>
</p>
<hr>
<p>Renewable energy jobs will be higher than our projections. We excluded employment areas such as building electricity transmission networks, bioenergy, professional services, renewable hydrogen, growth in minerals needed for renewable energy, and jobs in heavy industry such as “green” steel.</p>
<h2>Renewables vs coal jobs</h2>
<p>All up, coal mining in Australia employs about 40,000 people. As mentioned above, renewable energy jobs could grow to 45,000 by 2025 – and more once other sectors are included.</p>
<p>Australia’s renewable energy industry already employs considerably more people than the 10,500 working in the domestic coal sector – mostly thermal coal mining and power generation. </p>
<p>About 75% of coal mined in Australia is <a href="https://www.rba.gov.au/publications/bulletin/2019/sep/the-changing-global-market-for-australian-coal.html">exported</a>. About 24,000 people work in thermal coal mining for both domestic use and export – slightly fewer than the current renewable energy workforce. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/344692/original/file-20200630-103673-yokyxv.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/344692/original/file-20200630-103673-yokyxv.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=327&fit=crop&dpr=1 600w, https://images.theconversation.com/files/344692/original/file-20200630-103673-yokyxv.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=327&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/344692/original/file-20200630-103673-yokyxv.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=327&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/344692/original/file-20200630-103673-yokyxv.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=411&fit=crop&dpr=1 754w, https://images.theconversation.com/files/344692/original/file-20200630-103673-yokyxv.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=411&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/344692/original/file-20200630-103673-yokyxv.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=411&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Employment in renewable energy and coal.</span>
<span class="attribution"><span class="source">Author supplied</span></span>
</figcaption>
</figure>
<h2>New renewables jobs in coal regions</h2>
<p>Around two-thirds of renewable energy jobs could be created in regional areas. These would be distributed more widely than coal sector jobs. </p>
<p>The leading coal mining states, NSW and Queensland, have the biggest share of renewable energy jobs under all scenarios. </p>
<p>AEMO has identified “renewable energy zones” where most large-scale renewable energy is expected to be located. In both NSW and Queensland, some of these zones overlap with the coal workforce. In NSW, the Central West zone could also create employment in the Hunter region. In general, though, many renewable energy jobs will be located in other regions and the capital cities.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/really-australia-its-not-that-hard-10-reasons-why-renewable-energy-is-the-future-130459">Really Australia, it's not that hard: 10 reasons why renewable energy is the future</a>
</strong>
</em>
</p>
<hr>
<p>In terms of occupations, there is overlap between coal and renewable energy. These include construction and project managers, engineers, electricians, mechanical trades, office managers and contract administrators and drivers.</p>
<p>The timing and location of these renewables jobs will influence whether they can be a source of alternative jobs for coal workers. Re-training of coal workers would also be required. </p>
<p>But there is no direct job overlap for the semi-skilled machine operators such as drillers, which account for more than one-third of the coal workforce.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/344685/original/file-20200630-103688-1fhvki.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/344685/original/file-20200630-103688-1fhvki.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=283&fit=crop&dpr=1 600w, https://images.theconversation.com/files/344685/original/file-20200630-103688-1fhvki.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=283&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/344685/original/file-20200630-103688-1fhvki.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=283&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/344685/original/file-20200630-103688-1fhvki.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=355&fit=crop&dpr=1 754w, https://images.theconversation.com/files/344685/original/file-20200630-103688-1fhvki.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=355&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/344685/original/file-20200630-103688-1fhvki.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=355&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Renewable Energy Zones and coal mining employment in Queensland.</span>
<span class="attribution"><span class="source">Author supplied</span></span>
</figcaption>
</figure>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/344683/original/file-20200630-103668-1jclsd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/344683/original/file-20200630-103668-1jclsd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=283&fit=crop&dpr=1 600w, https://images.theconversation.com/files/344683/original/file-20200630-103668-1jclsd.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=283&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/344683/original/file-20200630-103668-1jclsd.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=283&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/344683/original/file-20200630-103668-1jclsd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=355&fit=crop&dpr=1 754w, https://images.theconversation.com/files/344683/original/file-20200630-103668-1jclsd.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=355&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/344683/original/file-20200630-103668-1jclsd.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=355&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Renewable energy zones and coal mining employment in NSW.</span>
<span class="attribution"><span class="source">Author supplied</span></span>
</figcaption>
</figure>
<h2>Planning for the decline</h2>
<p>Renewable energy can meaningfully help in the transition for coal regions. But it won’t replace all lost coal jobs, and planning and investment is needed to avoid social and economic harm.</p>
<p>Coal regions need industry development plans and investment to diversify their economies to other industries, including renewables. Almost half our coal workers are aged under 40, so Australia will not be able to <a href="https://theconversation.com/how-to-transition-from-coal-4-lessons-for-australia-from-around-the-world-115558">follow Germany and Spain’s lead</a> by relying on early retirement schemes.</p>
<p>At some point, demand for our coal exports will collapse – be it due to the falling cost of renewables, or policies to address climate change. If we don’t start preparing now, the consequences for coal communities will be dire.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/345195/original/file-20200702-2674-1i56fyz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/345195/original/file-20200702-2674-1i56fyz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/345195/original/file-20200702-2674-1i56fyz.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/345195/original/file-20200702-2674-1i56fyz.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/345195/original/file-20200702-2674-1i56fyz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/345195/original/file-20200702-2674-1i56fyz.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/345195/original/file-20200702-2674-1i56fyz.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Some coal workers can be retrained to work in renewables, but others cannot.</span>
<span class="attribution"><span class="source">Dan Himbrechts/AAP</span></span>
</figcaption>
</figure><img src="https://counter.theconversation.com/content/141531/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Chris Briggs receives funding from various government and non-government organisations. In 2019-20, funders for research included the Australian Renewable Energy Agency, the NSW and Victorian Government and the Clean Energy Council for renewable energy jobs research.</span></em></p><p class="fine-print"><em><span>Elsa Dominish receives research funding from various government and non-government organisations. In 2019-20 this includes the federal and NSW governments and the Clean Energy Council.</span></em></p><p class="fine-print"><em><span>Jay Rutovitz receives research funding from various government and non-government organisations. In 2019-20, this included the Australian Renewable Energy Agency, the NSW and Victorian Governments, the Future Batteries Industry Co-operative Research Centre, and the Clean Energy Council.</span></em></p>Some coal workers have the right skills and work in the right location to get a job in renewables. But many, such as semi-skilled machine operators, cannot.Chris Briggs, Research Principal, Institute for Sustainable Futures, University of Technology SydneyElsa Dominish, Senior Research Consultant, Institute for Sustainable Futures, University of Technology SydneyJay Rutovitz, Research Director, Institute for Sustainable Futures, University of Technology SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/578012016-04-14T05:47:15Z2016-04-14T05:47:15ZPeabody’s bankruptcy claim is a symbol of coal’s end<figure><img src="https://images.theconversation.com/files/118667/original/image-20160414-4703-ogo55s.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">The era of coal is coming to an end. </span> <span class="attribution"><a class="source" href="https://www.flickr.com/photos/weak_hope/7053347549/in/photolist-bKhfuv-Bgp95-4nCDV-pQToSa-eQRBYc-9f6zd8-cFKegY-4PLf81-aSMJsa-4PFYzX-8oVAWv-4yB5T3-fE5NPA-g2Sr7a-6Tc4n-9mQhSV-56Kw8f-nKRt-4YzA9J-bAi8Dd-nhWYLR-EudjC-4YzzU9-5mCLVX-cn1MNy-fdLKUk-JTBkK-EP68W-bEXTBx-LXRAK-bzMnsJ-bs5M5y-bCCtv6-4igNx-bCCtFe-evAEX6-gfjsQ-gfhSn-gfhVf-gfjAN-gfhV4-4YzApo-bEs4CH-bJyRec-3HqYy-4EDzs-6V7JC9-4sexXY-7Styh6-on8LN9">Alexander G/Flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a></span></figcaption></figure><p>The announcement that Peabody Energy, the world’s largest non-government coal company, is to <a href="https://t.co/J0UWVFn62j">file for bankruptcy</a> in the United States is one of more symbolic than substantive significance. In the US context, bankruptcy is a fairly routine form of financial reorganisation, rather than a prelude to liquidation.</p>
<p>Peabody sold about <a href="https://mscusppegrs01.blob.core.windows.net/mmfiles/files/investors/2014%20peabody%20annual%20report.pdf">250 million tonnes of coal</a> in 2014 from mines in Australia and the United States. </p>
<p>The most important substantive effect is that Peabody may be able to avoid paying some of its debts, notably obligations to retired and retrenched coalminers and the cost of rehabilitating abandoned mines.</p>
<p>The operation of Peabody’s Australian mines is unlikely to be affected immediately. It was the <a href="http://www.vox.com/2016/4/13/11420882/peabody-energy-bankruptcy-coal">purchase of these mines at inflated prices</a> during the coal boom that tipped Peabody over the edge, though the end was, in some sense, inevitable.</p>
<h2>Developed nations leaving coal</h2>
<p>In symbolic terms the Peabody bankruptcy, following those of the other leading US coal-mining companies, <a href="http://www.archcoal.com/restructuring/">Arch Coal</a> and <a href="https://cases.primeclerk.com/patriotcoal/">Patriot Coal</a>, is a striking example of the way in which the coal era, which began with the Industrial Revolution in Britain 250 years ago, is drawing to an end.</p>
<p>The end has already arrived in Britain, or nearly so. Britain’s <a href="http://www.theguardian.com/business/ng-interactive/2015/dec/18/the-demise-of-uk-deep-coal-mining-decades-of-decline">last deep coal mine</a> closed in December (although for the moment the country still imports coal). The UK’s <a href="https://www.gov.uk/government/news/government-announces-plans-to-close-coal-power-stations-by-2025">last coal-fired power station is due to close by 2025</a>. Steel production, using metallurgical coal, is also in serious trouble, with the <a href="http://www.bbc.com/news/business-35922046">announced withdrawal of Tata Steel</a>, the owner of most of the major UK steelworks.</p>
<p>In the United States, <a href="https://www.eia.gov/todayinenergy/detail.cfm?id=24472">coal production has already fallen dramatically</a> since its peak in 2008. The share of electricity generated by coal has also plummeted, <a href="http://www.reuters.com/article/us-usa-natgas-coal-idUSKCN0UY2LT">falling below that of gas</a> for the first time in 2015. This trend will only continue and it is likely that renewables will overtake coal by 2025.</p>
<p>Indeed, by 2025, reliance on coal-fired power will be the exception rather than the rule in the developed world. Much of North America and Europe will be entirely coal-free. Closer to home, <a href="http://www.smh.com.au/business/energy/genesis-energy-to-close-last-coalfired-power-stations-in-nz-20150805-giso0e.html">New Zealand</a> and <a href="https://theconversation.com/coal-closures-give-south-australia-the-chance-to-go-100-renewable-43182">South Australia</a> will be coal-free in the near future, though South Australia will still rely on trade with the largely coal-based National Electricity Market.</p>
<p>This outcome is inevitable if the world is to deliver on the <a href="https://theconversation.com/the-paris-climate-agreement-at-a-glance-50465">climate commitments made in Paris</a>, let alone to achieve the complete decarbonisation that is needed to stabilise the global climate. </p>
<p>Until recently, “hardheads” have assumed that such <a href="http://www.smh.com.au/federal-politics/political-opinion/tony-abbott-stifling-australias-climate-change-ambitions-20131113-2xfm3.html">commitments would be trumped by economic pressure</a>. But as often happens, the hardheads have proved to be deluded, while supposedly unrealistic environmentalists have been proved right.</p>
<h2>Don’t count on developing nations</h2>
<p>Coal advocates in Australia are holding out the hope that demand from rapidly developing countries will offset the end of the coal era in the developed world. But it is now evident that this hope is a mirage. </p>
<p><a href="http://ieefa.org/past-peak-coal-in-china/">China’s consumption of coal may have already peaked</a>. The recent <a href="http://www.reuters.com/article/us-china-power-coal-idUSKCN0WQ0ZD">cancellation of 250 coal-fired power plants</a> authorised by regional governments has made it clear that there will be no turning back. </p>
<p>While India is still increasing its use of coal, it is on track to <a href="https://theconversation.com/factcheck-qanda-will-india-no-longer-buy-australian-coal-46256">replace all imports with domestic production</a> in the next few years. More importantly the share of renewables is rising rapidly: <a href="http://reneweconomy.com.au/2016/india-energy-minister-says-solar-power-now-cheaper-coal-29756">large-scale solar plants are already cheaper than new coal</a> in India.</p>
<p>A handful of countries are still clinging to a coal-based strategy: these include Japan, Turkey, Poland, Bosnia and, under the Abbott and Turnbull governments, Australia. But the list is getting shorter all the time. </p>
<p>Vietnam announced a <a href="http://news.chinhphu.vn/Home/Plans-on-developing-power-coal-sectors-adjusted/20161/26495.vgp">review of its aggressive coal development plans</a> in the wake of the Paris agreements. Japan (which turned to coal after the Fukushima disaster) is under pressure to do likewise. Elsewhere, in Germany and Spain, for example, a generally positive trend is complicated by the hangover from previous policy failures.</p>
<p>Overall, however, the picture is clear. Coal mines and coal-fired power stations are closing in large numbers, and very few new ones will open in the future. The coal era is drawing to its end.</p><img src="https://counter.theconversation.com/content/57801/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>John Quiggin is a Member of the Climate Change Authority</span></em></p>Peabody, the world’s largest private coal company, has filed for bankruptcy, symbolising the world’s swing away from coal.John Quiggin, Professor, School of Economics, The University of QueenslandLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/380232015-02-25T19:31:38Z2015-02-25T19:31:38ZPeak fossil fuel won’t stop climate change – but it could help<figure><img src="https://images.theconversation.com/files/72984/original/image-20150224-25670-ekzf0p.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">What happens to coal in China will play a big role in deciding which climate road we're all on. </span> <span class="attribution"><a class="source" href="https://www.flickr.com/photos/67661012@N04/14658572287">Han Jun Zeng/Flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a></span></figcaption></figure><p>Fossil fuels are ultimately a finite resource – the definition of non-renewable energy. Burning of these fuels – coal, oil and gas – is the main driver of climate change. So could the peak of fossil fuels help mitigate warming?</p>
<p>The short answer is maybe … but perhaps not how you might think.</p>
<p>In a <a href="http://www.sciencedirect.com/science/article/pii/S0016236114010254">paper</a> published this month in the journal Fuel, my colleagues and I suggest that limits to fossil fuel availability might take climate Armageddon off the table, although we will still need to keep some fossil fuels in the ground for the best chance of keeping warming below 2C. </p>
<p>But more importantly, the peak of Chinese coal use is changing the face of global alternative energy industry development, and is soon likely to impact on international positioning for a low-emissions future.</p>
<p>Now for the long answer.</p>
<h2>Predicting climate change</h2>
<p>Predicting future climate change is dogged by two fundamental uncertainties: the dosage of greenhouse gas that human civilisation will add to the atmosphere, and how Earth’s climate and feedback systems will respond to it. </p>
<p>In the absence of a crystal ball for the future of emissions, the <a href="http://www.ipcc.ch/">Intergovernmental Panel on Climate Change</a> (IPCC) has adopted a scenario-based approach which highlights four <a href="http://www.skepticalscience.com/rcp.php">representative concentration pathways</a> (or RCPs). These are named after how much extra heating they add to the earth (in watts per square metre). </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/72978/original/image-20150224-25659-1j9tur4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/72978/original/image-20150224-25659-1j9tur4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/72978/original/image-20150224-25659-1j9tur4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=339&fit=crop&dpr=1 600w, https://images.theconversation.com/files/72978/original/image-20150224-25659-1j9tur4.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=339&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/72978/original/image-20150224-25659-1j9tur4.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=339&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/72978/original/image-20150224-25659-1j9tur4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=426&fit=crop&dpr=1 754w, https://images.theconversation.com/files/72978/original/image-20150224-25659-1j9tur4.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=426&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/72978/original/image-20150224-25659-1j9tur4.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=426&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">The relationship between emissions, and temperature projections.</span>
<span class="attribution"><span class="source">IPCC</span></span>
</figcaption>
</figure>
<p>From these scenarios the IPCC has developed temperature scenarios. So the RCP2.6 scenario is expected to restrict climate change to below 2C, whereas RCP8.5 represents catastrophic climate change of around 4C by the end of this century, rising to perhaps 8C in the ensuing centuries.</p>
<h2>Fossil fuels forecast</h2>
<p>The key thing to note here is that the emissions scenarios are demand-focused scenarios that have been developed to reflect possibilities for potential fossil fuel consumption. They explore a range of scenarios that include increasing global population and living standards, as well as the possible impact of new alternative energy technologies and global emissions-reduction agreements.</p>
<p>Instead of examining demand scenarios for fossil fuels, our work has focused on supply constraints to future fossil fuel production. Our work is not a forecast of future fossil fuel production and consumption, but rather seeks to determine the upper bounds of the geological resource and how it might be brought to market using normal supply and demand interactions. </p>
<p>We developed three projections based on different estimates of these Ultimately Recoverable Resources (URR). URR is the proportion of total fossil fuel resources that can be viably extracted now, and in the future (this accounts for some resources that are technologically inaccessible now becoming extractable in the future). The low case used the most pessimistic literature resource availability estimates, whereas the high case used the most optimistic estimates.</p>
<p>We also included a “best guess” estimate by choosing country-level resource values that we considered most likely. We then compared the resulting emissions profiles for the three upper bounds to the published IPCC emissions scenarios, as shown in the figure below.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/72979/original/image-20150224-25698-gjr53t.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/72979/original/image-20150224-25698-gjr53t.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/72979/original/image-20150224-25698-gjr53t.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=607&fit=crop&dpr=1 600w, https://images.theconversation.com/files/72979/original/image-20150224-25698-gjr53t.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=607&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/72979/original/image-20150224-25698-gjr53t.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=607&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/72979/original/image-20150224-25698-gjr53t.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=763&fit=crop&dpr=1 754w, https://images.theconversation.com/files/72979/original/image-20150224-25698-gjr53t.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=763&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/72979/original/image-20150224-25698-gjr53t.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=763&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Our projections for fossil fuel supply (black) matched with emissions scenarios (colours). RCP8.5 is the worst, RCP2.6 the best.</span>
<span class="attribution"><span class="source">Gary Ellem</span></span>
</figcaption>
</figure>
<p>In comparison to the published emissions scenarios, we found that it was very unlikely that enough fossil fuels could be brought to market to deliver the RCP8.5 scenario and we would recommend that this be removed from the IPCC scenarios in future assessment reports. </p>
<p>Mining out the optimistic fossil fuel supply base could perhaps deliver the RCP6 scenario, however, our best guess limit to fossil fuel availability caps the upper limit of emissions exposure to the RCP4.5 scenario (roughly equivalent to a median estimate of 2C warming). </p>
<p>But even under the low resource availability scenario, it will be necessary to leave some fossil fuels untapped if we are to meet the conditions for the RCP2.6 scenario or lower (to have more than a 90% chance of avoiding 2C temperature rise).</p>
<p>To sum up, our supply side assessment suggests that even if the climate Armageddon of the RPC8.5 scenario were desirable, it is unlikely that enough new fossil fuel resources could be discovered in time and brought to market to deliver it. To be clear, there is still much to worry about with the RPC4.5 and RPC6 scenarios which are still possible at the limits of likely fossil fuel resources. </p>
<p>So a simple reflection on global fossil fuel limitation won’t save us … but nations don’t face peak fuels at the same time. A country-level analysis of peak fuels suggests the possibility of a very different future.</p>
<h2>How China could shake the world</h2>
<p>As part of our assessment we looked closely at the fossil fuel production projections for four countries including China, Canada, the United States and Australia. Of these, China is by far the most intriguing.</p>
<p>China has little in the way of oil and gas resources and so has established its remarkable industrial growth on exploiting its substantial coal resources. Our projections indicate that the rapid expansion in Chinese coal mining is rapidly depleting this resource, with Chinese peak coal imminent in the mid-2020s under even the high fossil fuel scenario, as seen in the projections below.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/72983/original/image-20150224-25674-1n097mr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/72983/original/image-20150224-25674-1n097mr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/72983/original/image-20150224-25674-1n097mr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=590&fit=crop&dpr=1 600w, https://images.theconversation.com/files/72983/original/image-20150224-25674-1n097mr.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=590&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/72983/original/image-20150224-25674-1n097mr.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=590&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/72983/original/image-20150224-25674-1n097mr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=742&fit=crop&dpr=1 754w, https://images.theconversation.com/files/72983/original/image-20150224-25674-1n097mr.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=742&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/72983/original/image-20150224-25674-1n097mr.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=742&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Various scenarios for China’s fossil fuel supply.</span>
<span class="attribution"><span class="source">Gary Ellem</span></span>
</figcaption>
</figure>
<p>China is well aware of this and is currently scrambling to cap coal consumption and develop alternative energy projects and industries. Its leaders understand that the alternative energy sector is really an advanced manufacturing sector, and have moved to position themselves strategically as the world leader in solar, wind, hydro, battery and nuclear technology construction and manufacturing. </p>
<p>As fossil fuels start to fail China as a path to economic and energy security, China will join other regions in a similar position, such as the European Union nations, which have largely depleted their fossil fuel reserves. </p>
<p>For these nations focused on alternative energy investment for energy and economic security, global action on climate change is strategically aligned with their industrial strength. We can therefore expect them to pressure for increasing global action as a method of improving their strategic global trading position. We may see the beginnings of this transition at this year’s <a href="https://theconversation.com/au/topics/paris-2015-climate-summit">international climate talks in Paris</a> this year, but it will take a few more years for the Chinese shift to play out as they exploit the remainder of their coal resource and gain confidence in the ability of their alternative energy sector to scale. </p>
<p>The question then becomes “can the USA manufacturing sector afford to be out of these global alternative energy markets?”. Our guess is “no” and a global tipping point will have been reached in the alternative energy switch. </p>
<p>This is perhaps the most profound way that peak fuels may contribute to a low-emissions future.</p><img src="https://counter.theconversation.com/content/38023/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Gary Ellem has previously received funding from the Federal Government Researchers in Business scheme to work in the biofuels sector.</span></em></p>Peak fossil fuel means it’s unlikely the worst climate scenario will come to pass. Gary Ellem explains.Gary Ellem, Conjoint Academic in Sustainability, University of NewcastleLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/349582014-12-03T19:33:48Z2014-12-03T19:33:48ZNuclear power isn’t ‘economically feasible’ in Australia, but …<figure><img src="https://images.theconversation.com/files/66144/original/image-20141203-15626-l1xdy3.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">If Australia's to have nuclear power, there'll have to be policies to support it.</span> <span class="attribution"><a class="source" href="https://www.flickr.com/photos/flokru/391053464">flokru/Flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by-nc/4.0/">CC BY-NC</a></span></figcaption></figure><p>No sooner had foreign affairs minister Julie Bishop <a href="http://www.smh.com.au/federal-politics/political-news/julie-bishop-reopens-nuclear-debate-as-route-to-cut-carbon-dioxide-emissions-20141129-11w17k.html">announced</a> that Australia should take a fresh look at nuclear power than Prime Minister Tony Abbott <a href="http://www.liberal.org.au/latest-news/2014/12/01/prime-minister-press-conference-canberra">responded</a> that nuclear power would only be supported if it was “economically feasible” and would not receive government subsidies.</p>
<p>Tony Abbott can rest easy in his position knowing this much to be true: thanks to an oversupply of incumbent, polluting electricity in the Australian market, nuclear energy is not economically feasible in Australia … but neither is any other new energy source without a policy to guide investment. </p>
<h2>We do it for renewables …</h2>
<p>Such a policy is exactly what the <a href="https://theconversation.com/au/topics/renewable-energy-target">Renewable Energy Target</a> is doing for renewable sources, and we are currently seeing what happens when you <a href="https://theconversation.com/why-has-investment-in-renewable-energy-projects-stalled-34197">introduce uncertainty</a> into the sector. </p>
<p>Cut the large-scale renewable energy target, and wind development will halt on a dime. </p>
<p>Cut the small-scale renewable energy scheme, and feed-in tariffs and rooftop solar will fall off a cliff. </p>
<p>Remove carbon pricing (as Australia did in July this year), and serious investment in carbon-capture and storage technology becomes a fantasy. </p>
<p>There is no policy-free pathway to replacing Australia’s established and highly polluting coal- and gas-fired power stations.</p>
<h2>Too much electricity</h2>
<p>Abbott’s position is reinforced by the <a href="https://theconversation.com/factcheck-does-australia-have-too-much-electricity-31505">current level of over-supply</a> in the National Electricity Market. </p>
<p>Thanks to the combination of an exodus of several large industrial customers in the industrial and manufacturing sector, influx of new wind and solar with the assistance of the Renewable Energy Target, and a greater emphasis on energy efficiency in households, we have seen in the last few years a waning demand for electricity while supply remains high. </p>
<p>So there is no market incentive for investment in new large generation such as nuclear power … or anything else for that matter. Even if there were, this would just be new clean generation on top of old dirty generation.</p>
<p>Whether one prefers the flavour of solar, wind, geothermal, wave or nuclear power, the fact is nothing much will change in the foundations of the Australian energy scene in the foreseeable future unless we demand change. We are not running out of cheap coal; we have to choose to DO something. </p>
<h2>Cleanest technologies</h2>
<p>However, if we decide that we want to generate electricity without increasing carbon emissions, the story is completely different.</p>
<p>According to the updated <a href="http://www.bree.gov.au/publications/australian-energy-technology-assessments">Australian Energy Technology Assessment 2013</a>, the five lowest-cost electricity-generating technologies, based on dollars per kilowatt hour, are, in ascending order:</p>
<ul>
<li>Wind, on-shore</li>
<li>Fixed solar photo-voltaic (no tracking of the sun’s movement)</li>
<li>Gigawatt-scale nuclear light-water reactor</li>
<li>Other biomass waste power plant (wood)</li>
<li>Single axis tracking solar photo-voltaic (tracking the sun in one axis).</li>
</ul>
<p>These costs are projected for 2020, based on recent trends in electricity costs using the metric “levelised cost of electricity” (LCOE). All of these technologies produce zero carbon emissions at the point of generation, and we would expect all of them would do well under a policy that sought a major increase in zero-carbon electricity. </p>
<h2>The problem of supply</h2>
<p>But these very different technologies also come with a range of economic advantages and disadvantages.</p>
<p>For instance, solar panels and wind turbines have the advantage of incremental expenditure (you add relatively small amounts of new generation at a time) which is easier to finance. </p>
<p>But the electricity they generate is at the whim of climate: without storage, they depend on the sun shining and the wind blowing. </p>
<p>This is the difference between capacity and generation, which the LCOE costs we refer to above don’t account for. While we can install a certain capacity of wind and solar, we can guarantee it will not generate electricity at that level all the time. </p>
<p>As we explore in an upcoming paper (along with co-author Corey Bradshaw), this is not a big deal when variable generators such as wind and solar are only used at low levels (currently, variable renewables provide less than 5% of total supply in the market). In this situation, there is always spare capacity from other sources such as hydro, coal and gas waiting to take up any slack. </p>
<p>At high levels (literature suggests more than 20-25% of total generation), however, the tables turn very quickly. There comes a point when adding more variable energy sources just won’t make economic sense. Nor will it increase the reliability of the overall system. </p>
<p>To fill the gap, we need a source with a large capacity factor that depends on a storable fuel rather than favourable weather.</p>
<p>On these criteria, nuclear power stands out in the top five. It is <a href="http://bravenewclimate.com/2013/03/14/81000-truckers-for-solar/">more sustainable and is more scalable than biofuels </a>that brings with it major negative impacts in land-use and air quality. And it doesn’t depend on the weather like solar and wind. Nuclear power stations in Australia could provide close to full power at all times. </p>
<p>Another way of saying this is that nuclear offers a complete “plug-in” replacement for the role that coal-fired power stations play in the electricity system, both in the amount of electricity supplied, and its reliability. </p>
<p><a href="http://www.onlineopinion.com.au/view.asp?article=11356">Earlier work</a> from one of us (Barry, along with Tom Biegler and Martin Nicholson) confirmed that nuclear is the most cost-effective substitute for coal that would respond earliest to a carbon price. </p>
<p>More <a href="http://www.sciencedirect.com/science/article/pii/S0306261914010101">recent work</a> from Barry, Sanghyun Hong and Corey Bradshaw at the University of Adelaide found that an optimal scenario of zero-carbon electricity for Australia included nuclear providing more than 40% of total electricity.</p>
<h2>Zero carbon, technology neutral</h2>
<p>So, what’s the best way to level the playing field? </p>
<p>First, we need to rescind the arbitrary prohibition of nuclear energy in Australia. To that extent we welcome the statements of foreign affairs minister Julie Bishop. </p>
<p>Second, we need a technology-neutral clean energy target. One of us (Ben) <a href="http://decarbonisesa.com/2014/10/27/nuclear-and-renewables-in-the-name-of-national-interest/">argued recently,</a> that a 95% Clean Energy Target that is open to all technologies (not just renewables), which offered differentiated payments between variable and non-variable electricity sources, would likely make big winners out of solar and wind in the early stages, followed by a swing toward nuclear in the near future. Such a policy would put the arguments of economic viability to the only test that really matters: the market. </p>
<p>But, to go back to where we started, in the absence of that type of policy for change in our energy sector, any such future is stalled. </p>
<p>Nuclear, in the current context, is uneconomic in Australia. But so are large-scale renewables that will meet demand. </p>
<p>The marketplace is a societal construct, not a natural law. Provided the atmosphere is treated as a free dump, and climate stability is treated as inconsequential to our well-being, the market winner in Australia is incumbent coal. That won’t alter unless we demand change. </p>
<hr>
<p><em>Editor’s note: Ben and Barry will be answering questions between 2 and 3pm AEDT on Thursday December 4. Ask your questions about nuclear power’s economic feasability in Australia in the comments below.</em></p><img src="https://counter.theconversation.com/content/34958/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Ben Heard is Director of ThinkClimate Consulting, a private consultancy providing analysis and advisory services to government, private sector and not-for-profit clients.</span></em></p><p class="fine-print"><em><span>Barry W. Brook receives funding from the Australian Research Council and the US National Science Foundation. He is a member of the International Awards Committee of the Global Energy Prize and is on the Advisory Board of the Breakthrough Institute.</span></em></p>No sooner had foreign affairs minister Julie Bishop announced that Australia should take a fresh look at nuclear power than Prime Minister Tony Abbott responded that nuclear power would only be supported…Ben Heard, Doctoral student, University of AdelaideBarry W. Brook, Professor of Environmental Sustainability, University of TasmaniaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/330122014-10-15T19:27:56Z2014-10-15T19:27:56ZCarbon capture and storage — reality or still a dream?<figure><img src="https://images.theconversation.com/files/61810/original/vjdgmffh-1413353731.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Could carbon capture and storage be the way to clean up coal power stations, such as this one in Australia's Latrobe Valley? </span> <span class="attribution"><a class="source" href="https://www.flickr.com/photos/monashuni/8219241614">Monash University/Flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by-nc/4.0/">CC BY-NC</a></span></figcaption></figure><p>To have any chance of avoiding dangerous climate change we’ll have to reduce the carbon emissions from our energy sectors — currently the largest human source of greenhouse gas emissions globally. And we’ll have to do it quickly. </p>
<p>Renewable energy is one solution. But given ongoing debate about supplying enough energy for a growing population, and replacing old fossil fuel energy generators, options such as carbon capture and storage have been hailed as another. </p>
<p>Recently the largest carbon capture and storage program yet began operation at SaskPower’s Boundary Dam project in Saskatchewan, Canada. The project retrofitted a 138 megawatt coal power station into a 110 megawatt station, and is expected to <a href="http://sequestration.mit.edu/tools/projects/boundary_dam.html">capture 90% of the carbon emissions</a> produced through burning the coal. </p>
<p>Carbon capture and storage, or CCS, gained attention as far back as 1995, when the Intergovernmental Panel on Climate Change speculated that yet-to-be-developed CCS technology might be applied to large fossil fuel generators.</p>
<p>The Canadian project demonstrates that the technology can be used, but we now know it comes at considerable cost, and may not even reduce overall carbon emissions. </p>
<p>Many of these issues have been presented in a <a href="http://bze.org.au/discussions/pdf_files/CCS_20141013.pdf">CCS Information Paper</a> by Beyond Zero Emissions, of which I am the CEO. </p>
<h2>Why CCS?</h2>
<p>The rationales supporting CCS include the technical, economic and political obstacles in the transition to a zero carbon energy system such as one reliant on renewable energy.</p>
<p>From a physical construction point of view, replacement of existing emission intensive generation capacity, on top of the additional capacity required in developing economies, is a daunting prospect. Particularly when considering the ever tightening time-frame for change for preventing dangerous climate change. </p>
<figure class="align-right zoomable">
<a href="https://images.theconversation.com/files/61803/original/xg9tbn6b-1413352408.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/61803/original/xg9tbn6b-1413352408.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/61803/original/xg9tbn6b-1413352408.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=466&fit=crop&dpr=1 600w, https://images.theconversation.com/files/61803/original/xg9tbn6b-1413352408.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=466&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/61803/original/xg9tbn6b-1413352408.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=466&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/61803/original/xg9tbn6b-1413352408.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=586&fit=crop&dpr=1 754w, https://images.theconversation.com/files/61803/original/xg9tbn6b-1413352408.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=586&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/61803/original/xg9tbn6b-1413352408.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=586&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">How CCS works.</span>
<span class="attribution"><a class="source" href="http://commons.wikimedia.org/wiki/File%3ACarbon_sequestration-2009-10-07.svg">LeJean Hardin and Jamie Payne derivative work: Jarl Arntzen/Wikimedia Commons</a>, <a class="license" href="http://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a></span>
</figcaption>
</figure>
<p>In addition, a political minefield awaits the regulated obsolescence of a large utility asset portfolio of mixed public and private shareholders as greenhouse gas emissions cease to be ignored.</p>
<p>It’s no wonder that the possibility to adapt these assets to operate without emitting carbon dioxide invites temptation — a circuit breaker of sorts.</p>
<h2>CCS doesn’t work if you’re digging up more fossil fuels</h2>
<p>The Canadian CCS project will use the captured carbon to help extract crude oil. This is partly to offset the cost of capturing carbon, but what does it mean for carbon emissions? </p>
<p>The CO<sub>2</sub> injected into oil-bearing rock mixes with the oil and allows that oil (now mixed with CO<sub>2</sub>) to move to the surface, via wells, for recovery. </p>
<p>After separating the CO<sub>2</sub> from the recovered oil, CO<sub>2</sub> (valued by the industry between US$25-$40 per tonne) is cycled back into the ground again and again.</p>
<p>Ultimately some CO<sub>2</sub> will remain permanently stored. But CO<sub>2</sub> enhanced oil recovery can produce between 0.2 and 1.1 tonnes of oil <a href="http://www.neori.org/NEORI_Report.pdf">for every tonne of CO<sub>2</sub> permanently stored</a> (see also <a href="http://neori.org/Melzer_CO2EOR_CCUS_Feb2012.pdf">here</a> and <a href="http://www.netl.doe.gov/file%20library/research/oil-gas/small_CO2_EOR_Primer.pdf">here</a>). </p>
<p>Nearly all of the oil will be burned to produce 0.6 to 3.4 tonnes of CO<sub>2</sub>. Therefore, the ratio of CO<sub>2</sub> stored to CO<sub>2</sub> released due to oil burning ranges from 0.6-to-1 to 3.4-to-1. That’s either slightly climate-positive (with an overall storing of carbon) or very climate-damaging (with carbon released overall).</p>
<p>In order to maximise profit, oil producers will inevitably target the most climate-damaging reservoirs where the greatest amount of oil can be recovered by using the least amount of CO<sub>2</sub>. </p>
<p>On top of emissions from oil, in North America where most of the new CO<sub>2</sub> injection activities are planned, any CO<sub>2</sub> permanently stored is not expected to be monitored and verified. No legal mechanisms have been established. So in this case the permanent storage of any CO<sub>2</sub> should be considered incidental.</p>
<h2>High cost — for what gain?</h2>
<p>So why use CO<sub>2</sub> to retrieve oil at all? One reason is to offset to considerable costs of retrofitting the coal power station, and countering the 21% drop in power output. </p>
<p>The essential goal behind CCS is to preserve capital assets while transitioning to zero carbon emissions. But this argument doesn’t hold up under scrutiny.</p>
<p>We can de-carbonise electricity by replacing fossil fuel power with renewable, or retrofitting fossil fuel power with CCS, or a mix of both. But no matter which path we choose, it will come at the expense of emissions-intensive power generators, and then passed on to society. </p>
<p>This can come through devalued share holder capital from closing power stations early, or through additional investment for CCS. </p>
<p>In the case of the latter, the capital returns of fossil fuel generators renewed by CCS would be clipped by a wholesale electricity market in which renewable generation is already proving competitive. Any room in the wholesale market for price increases would be borne by electricity customers. </p>
<p>Additional investment not generating additional revenue dilutes returns, effectively consuming the pre-existing capital. Any shareholder of a company experiencing an unproductive equity raising is aware of this reality. The only capital preserved therefore would be the balance of existing and new capital – if any.</p>
<p>The Canadian CCS project is the first chance to test this point. A <a href="http://www.saskpowerccs.com/ccs-projects/boundary-dam-carbon-capture-project/carbon-capture-project/">reported CA$1.35 billion</a> (AU$1.56bn) including a CA$240 million government grant has been invested to retrofit the coal power station with CCS — converting 139 megawatts to 110 megawatts. </p>
<p>Compare this with the <a href="http://www.agl.com.au/about-agl/media-centre/article-list/2014/september/agl-completes-sale-of-macquarie-generation-and-announces-leadership-change">recent sale</a> of the NSW owned MacGen to AGL — 4,640 megawatts for the sum of AU$1.5 billion. Clearly any attempt to refit Macquarie Generation with CCS would prove far more costly than foregoing such a sale value.</p>
<p>It is clear that it would be less costly to simply replace emission intensive generators — a cost that would be offset by avoided future fuel expenditure.</p>
<h2>More cost and less abatement</h2>
<p>Quite aside from greenhouse gas emissions which CCS seeks to resolve, other problems remain with the continued use of fossil fuels. </p>
<p>Mine site land-use conflict with agricultural production and protected areas of bio-diversity, fire risk of exposed flammable material, combustion waste solids and other pollutants not addressed by carbon capture, as well as water intensity of thermally inefficient generators to name but a few. </p>
<p>It must be questioned why infrastructure which entails such significant external costs would be adhered to so determinedly, even if CCS could be proved as a slightly commercial proposition. </p>
<p>When it’s clear that CCS is not even close to a commercial prospect and when net CO<sub>2</sub> emissions may actually increase when combined with oil recovery we must accept reality and swiftly move on to proven and affordable solutions to reducing carbon emissions such as renewable energy, energy efficiency and reforestation to name but a few.</p><img src="https://counter.theconversation.com/content/33012/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Stephen is CEO of think tank Beyond Zero Emissions. Beyond Zero Emissions receives funding from philanthropic sources.</span></em></p>To have any chance of avoiding dangerous climate change we’ll have to reduce the carbon emissions from our energy sectors — currently the largest human source of greenhouse gas emissions globally. And…Stephen Bygrave, Adjunct Professor, Faculty of Science, UNSW SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/317832014-09-24T05:18:36Z2014-09-24T05:18:36ZChina’s war on pollution could leave Aussie coal out in the cold<figure><img src="https://images.theconversation.com/files/59846/original/xzxn5rt9-1411527726.jpg?ixlib=rb-1.1.0&rect=1%2C0%2C766%2C509&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Australian coal needs to find some new customers.</span> <span class="attribution"><span class="source">Stephen Codrington/Wikimedia Commons</span></span></figcaption></figure><p>China’s recent move to <a href="http://www.smh.com.au/business/risky-business-china-dumps-our-dirty-coal-20140916-3fvpf.html">limit imports of the dirtiest coal from 2015 onwards</a> is a scary prospect for Australian miners.</p>
<p>The proposed restrictions will ban the burning of coal with high levels of ash or sulphur in areas around major cities, as the Beijing government battles its pollution crisis. <a href="http://www.platts.com/latest-news/coal/singapore/australian-suppliers-likely-to-be-hit-hard-by-27639794">Analysts say</a> that as much as half of the thermal coal currently shipped from Australia to China could run afoul of the new measures.</p>
<p>The exact effects on Australia’s coal export market are hard to predict, and will doubtless vary between different companies and coalmining regions. But what is clear is that unless it can find some new customers, the sector is likely to find itself in trouble.</p>
<h2>Aussie coal</h2>
<p>Australia is the world’s fourth-largest coal nation, with a <a href="http://www.abs.gov.au/ausstats/abs@.nsf/mf/8415.0">A$16.9 billion industry</a> that produces <a href="http://bree.gov.au/publications/resources-and-energy-statistics">401 million tonnes a year</a> – almost <a href="http://www.minerals.org.au/file_upload/files/resources/coal/Coal_Hard_Facts.pdf">8.9% of the world total</a>. </p>
<p>Industry groups have <a href="http://www.australiansforcoal.com.au/coal-4-the-economy.html">claimed</a> that coal mining contributes some A$60 billion a year to Australia’s economy – roughly the same as the iron ore and agricultural sectors – while supplying A$3 billion in total yearly royalties to the Queensland, New South Wales and Victorian state governments. </p>
<p>Like other resource exports, Australia’s thermal coal sales – worth A$16 billion worldwide according to the <a href="http://www.bree.gov.au/sites/bree.gov.au/files/files/publications/req/REQ-2013-12.pdf">Bureau of Resource and Energy Economics</a> – are at the mercy of the world market.</p>
<p>The Australian coal industry is already reeling after two years dogged by job losses, increased costs and rapidly eroding profitability. Nearly <a href="http://www.abc.net.au/news/2014-05-16/coal-outlook/5462226">10,000 coal workers lost their jobs</a> in 2013, and more lay-offs are expected in the future.</p>
<h2>Prices tumbling</h2>
<p>With coal prices <a href="http://www.indexmundi.com/commodities/?commodity=coal-australian&months=60">already falling</a>, Australian exporters could also face the extra prospect of having to “wash” their product to bring ash and sulphur within China’s new guidelines – which will add costs and damage profit margins. The potential extra cost has been estimated at anywhere between <a href="http://reneweconomy.com.au/2014/coal-industry-in-deep-denial-over-chinese-crackdown-on-coal-88731">A$1 and A$27 per tonne</a>.</p>
<p>Since 2004 there has been a continuous slowdown in mining sector productivity (the output relative to capital and/or labour input), mainly because both labour and capital costs have been consistently <a href="http://www.afr.com/p/markets/market_wrap/high_costs_put_our_mining_future_xMDLwFuMFRILTCu2HX5qhM;%20http:/www.rba.gov.au/publications/bulletin/2012/jun/pdf/bu-0612-3.pdf;%20http:/www.bree.gov.au/sites/bree.gov.au/files/files/discussion-papers/australian-mining-productivity-paper.pdf">above the global average</a>. </p>
<p>Yet despite these productivity issues, and the growing worldwide expectation that coal mining and coal-fired power generation should meet higher environmental standards, the Australian coal sector is focusing on increasing its production. Recently, despite contention about the environmental impacts, federal environment minister Greg Hunt and the Queensland government approved the <a href="https://theconversation.com/carmichael-mine-is-a-game-changer-for-australian-coal-29839">Carmichael coalmine</a> in the Galilee Basin. </p>
<p>One of the largest coal projects in the world, the new mine will cover 200 square km and add up to <a href="http://www.smh.com.au/business/mining-and-resources/adanis-giant-galilee-basin-coal-mine-gets-federal-government-approval-20140728-zxm8w.html">60 million tonnes annually</a> to Australia’s existing coal production. In an increasingly competitive market, Australia will need to find more buyers for its new coal supplies.</p>
<h2>New customers needed</h2>
<p>Indonesia already competes with Australia to export to China, and it is anticipated that the United States will increase its coal exports from the <a href="http://en.wikipedia.org/wiki/Powder_River_Basin">Powder River Basin</a> in Wyoming and Montana over the next few years. Meanwhile, other emerging producers including Mongolia and Mozambique are expected to create significant competitive pressure in the world’s coal export market.</p>
<p>At the same time, many Asian economies are increasing their electricity generation capacity – some of it through renewable energy, but significant amounts through fossil fuels – which may open new avenues for Australian coal exports. </p>
<p>China has recently shown interest in investing in coal-fired power plants in Pakistan, and Pakistani power minister Khawaja Muhammad Asif <a href="http://www.pakistantoday.com.pk/2014/09/09/business/we-were-talking-about-chinese-investment-not-loan-asif">said earlier this month</a> that one of the sources of coal could be Australia.</p>
<h2>What will China’s new rules mean?</h2>
<p>It is not yet clear how much Australia’s coal industry stands to lose from China’s new rules. The costs of processing it to the required standard are not clear, particularly because much of Australia’s coal is well above the Chinese requirements anyway. </p>
<p>But the move nevertheless represents another new problem for a sector that is facing many other challenges, including deterioration in terms of trade (the ratio of export prices to import prices), low coal prices, exchange rate appreciation, declining productivity, and the emergence of overseas rivals with lower production costs. </p>
<p>That is why Australia’s coal sector is now focusing on ramping up production, to try and gain a competitive advantage over emerging Asian and African miners and capture a greater market share for sustained export earnings.</p>
<h2>The climate challenge</h2>
<p>The other major challenge facing Australian coal, highlighted by this week’s <a href="https://theconversation.com/au/topics/un-climate-summit-2014">UN Climate Summit</a> in New York, is fact that much of the world is aiming to wean itself off it. </p>
<p>China’s thermal coal use is <a href="http://www.businessspectator.com.au/news/2014/9/22/energy-markets/china-coal-demand-may-peak-2016">forecast to peak in just two years</a>, and UN climate chief Christiana Figueres has <a href="http://www.abc.net.au/news/2014-09-23/unabated-coal-has-no-future-in-energy-mix-un-warns/5761950?WT.mc_id=newsmail">advocated the replacement of fossil fuels with alternative energy sources</a>. </p>
<p>China’s investment in up to 200 gigawatts of wind energy is just one sign that it is aiming to reduce its dependence on coal. There is a growing sense that China is <a href="https://theconversation.com/leaders-skip-un-talks-as-china-looks-to-go-it-alone-on-carbon-32023">getting serious about cutting its greenhouse emissions</a>. </p>
<p>China’s new coal regulations are a warning to Australian miners that they won’t survive either without exploring other export markets besides their traditional customers, China and Japan. </p>
<p>And if Australia wants to remain an energy exporter far into the future, it should focus on exploiting its admirable technological abilities to develop renewable energy products that could diversify its exports still further.</p>
<p><em>The author acknowledges comments on this piece from Dr Jo-Anne Everingham and Professor Saleem Ali at the University of Queensland.</em></p><img src="https://counter.theconversation.com/content/31783/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Shabbir Ahmad does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>China’s recent move to limit imports of the dirtiest coal from 2015 onwards is a scary prospect for Australian miners. The proposed restrictions will ban the burning of coal with high levels of ash or…Shabbir Ahmad, Postdoctoral Research Fellow, Centre for Social Responsibility in Mining, The University of QueenslandLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/308682014-08-25T09:36:38Z2014-08-25T09:36:38ZRoss Garnaut: China to reach ‘peak coal’ for electricity by 2015<figure><img src="https://images.theconversation.com/files/57280/original/4b6v92ww-1408952207.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">As early as 2015 China's use of thermal coal for electricity could peak. </span> <span class="attribution"><a class="source" href="https://www.flickr.com/photos/bretarnett/97352331">Bret Arnett/Flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by-nc-sa/4.0/">CC BY-NC-SA</a></span></figcaption></figure><p>China’s use of coal for electricity could peak as early as next year, then decline until 2020 in a turnaround of “global importance”, according to economist Ross Garnaut in a <a href="https://theconversation.com/chinas-energy-transition-effects-on-global-climate-and-sustainable-development-30883">lecture</a> presented at the Melbourne Sustainable Society Institute, University of Melbourne. </p>
<p>The shift means the world has a much better chance of keeping global warming below 2 degrees C — the internationally-agreed guardrail against dangerous climate change. </p>
<p>Slowing economic growth, increasing energy efficiency and growth in low-carbon electricity sources are driving the trend.</p>
<p>The Chinese economy grew strongly between 2000 and 2011 by 11% each year, but has slowed to around 7% each year since. Combined with increasing energy efficiency, this is driving down growth in energy demand — to around 4% each year. </p>
<p>At the same time, low-emissions electricity sources — hydro, wind, nuclear, solar and gas — have grown strongly, by around 4% each year. Because these sources are cheaper to use than coal, this has led to a “dramatic decoupling” of coal from economic growth, said Garnaut.</p>
<p>Solar energy has recorded the fastest growth since 2010 — generation capacity of solar increased by over 140% between 2012 and 2013. But solar is difficult to predict, and Garnaut expects growth to slow up to 2020. Even so, low-carbon sources will continue to grow strongly until 2020.</p>
<p>Wind power grew by nearly 40% between 2012 and 2013, and is forecast to grow by 18% each year until 2020. Over the same period nuclear grew by 14% and hydro by nearly 5%, and both are expected to grow at similar rates each year until 2020. </p>
<p>Gas was more difficult to predict, due to uncertainty over domestic gas finds, but is forecast to grow by 25% each year. </p>
<p>“Non-coal sources of energy account for virtually all the growth in electricity demand,” Garnaut said. </p>
<p>While Garnaut based his “conservative” projections on the electricity sector, he said he would not be surprised to see total carbon emissions in China peak by 2020. “It makes it possible to think realistically about the world reaching a 2C target.”</p>
<p>While China would need to do more between 2020 and 2030, the projections suggest China has turned the corner. </p>
<p>Garnaut based his projections on targets and policies already in action. He acknowledged that vested interests in coal, as in Australia, could slow the transition from coal to other energy sources, but said that the new model for economic growth was currently winning. </p>
<p><em>You can read Ross Garnaut’s full lecture <a href="https://theconversation.com/chinas-energy-transition-effects-on-global-climate-and-sustainable-development-30883">here</a> on The Conversation</em></p><img src="https://counter.theconversation.com/content/30868/count.gif" alt="The Conversation" width="1" height="1" />
China’s use of coal for electricity could peak as early as next year, then decline until 2020 in a turnaround of “global importance”, according to economist Ross Garnaut in a lecture presented at the Melbourne…James Whitmore, Deputy Editor: Arts + Culture, The ConversationLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/298392014-07-29T05:16:55Z2014-07-29T05:16:55ZCarmichael mine is a game-changer for Australian coal<figure><img src="https://images.theconversation.com/files/55138/original/vxcqmf7v-1406610224.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">The Saraji coal mine in the Bowen coal basin produces around 5 million tonnes of coal each year. Adani's Carmichael mine could produce up to 60 million. </span> <span class="attribution"><a class="source" href="https://www.flickr.com/photos/beyondcoalandgas/9296032205">Image Library/Flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by/4.0/">CC BY</a></span></figcaption></figure><p>The Carmichael coal project, <a href="https://theconversation.com/approval-of-australias-largest-coal-mine-ignores-climate-and-water-29780">approved this week by environment minister Greg Hunt</a>, is unprecedented in its scale, and also represents a significant shift in Australia’s coal industry. </p>
<p>If the mine goes ahead — Adani is yet to make a final commitment — it will be Australia’s largest, and represents the start of the opening up of Australia’s Galilee Basin, one of Australia’s richest coal reserves. </p>
<p>Most of the <a href="http://www.abc.net.au/environment/articles/2014/07/28/4025069.htm">environmental concerns</a> have focused on climate, groundwater, and indirect impacts on the Great Barrier Reef. The mine was approved with 36 conditions, many to offset damage to water; potential impacts on the Great Barrier Reef and climate were considered in the approval process but not included as development conditions. </p>
<p>However it is likely that the greenhouse emissions are a zero-sum game; even if the carbon emissions generated from burning the coal in India were included in the assessment, India would source coal from somewhere else.</p>
<h2>Australia’s largest coal mine</h2>
<p>The most notable feature of the new project is its sheer scale. If constructed, it will become the biggest mine in Australia, and one of the biggest in the world, producing an estimated 60 million tonnes of steaming coal each year over an estimated life of 60 to 90 years. </p>
<p>This dwarfs most existing mines nearby. There are currently almost 50 coal mines operating in the Bowen Basin, most producing between 5 and 10 million tonnes per year, and most with relatively short life spans of 10 to 30 years. The proposed mine is 6 to 12 times bigger than most operating mines, and will operate for at least twice as long. </p>
<p>Along with the change in the scale of operation come significant economic impacts. Queensland produced 284 million tonnes of coal with a total operating workforce of almost 29,000 people in 2013. This mine alone is set to have an operating workforce of 3,920 jobs, meaning that coal output and coal-mining employment would increase in Queensland by 21% and 13.5%, respectively. </p>
<p>The economic benefits will multiply back through regional, state and national economies. The varied location of coal employees and business suppliers, and the flow-on impacts to Government revenue, including royalties to the Queensland Government and company and income tax receipts to the Australian government, mean that the positive economic benefits will not only accrue to mining areas but much more widely across Queensland and Australia. </p>
<p>The proposed mine is remote from established communities in central-western Queensland, and development would be a welcome respite to businesses and workforce grappling with the recent downturn in the fortunes of the mining sector. </p>
<p>The big questions will focus on where the <a href="https://theconversation.com/topics/fifo">fly-in/fly-out (FIFO)</a> workers will be sourced from and how much economic stimulus can be injected into regional communities. While the regional cities of Rockhampton, Mackay and Townsville are closest to the mine site, trends towards sourcing FIFO workers from further afield and capital cities do not guarantee that employment be sourced from the closest regional areas.</p>
<h2>Linking Australian coal to Indian power</h2>
<p>The Carmichael coal project is a proposal of Indian energy company Adani. Unlike most of Australia’s coal producers, Adani is essentially a power generator that is looking to secure energy sources into the longer term and to meet the growing demands for electricity in India.</p>
<p>This explains why, when prices for steaming coal are depressed internationally, Adani appears committed to the new mine and the scale of the infrastructure development needed, even though <a href="http://www.abc.net.au/am/content/2014/s4055969.htm">raising capital is challenging</a> in the current environment. Currently <a href="https://theconversation.com/australias-coal-industry-needs-to-prepare-for-global-climate-action-28547">exports to India</a> at about 27 million tonnes each year from Queensland account for about 10% of the State’s coal production, so the new project would more than triple that level.</p>
<p>Most of the coal producers in Australia are content to specialise in their mining operations and then deal with the vicissitudes of market prices, as compared to investments by countries like China into Africa where control of supply chains is a primary driver. </p>
<p>Adani is yet to make the final investment commitment to the project, but if it does, it will signal the emerging importance of supply chain integration in the Australian mining sector.</p>
<h2>Opening up the Galilee</h2>
<p>The scale of the project is tied to another notable feature of this development; it will establish mining in the Galilee Basin. Unlike the Bowen Basin further to the east, the Galilee Basin has remained undeveloped because of its remoteness and because its vast reserves of coal are suitable for power generation (steaming coal) rather than the more valuable coking coal used for steel production. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/45949/original/b42pvsn8-1397024043.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/45949/original/b42pvsn8-1397024043.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/45949/original/b42pvsn8-1397024043.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=424&fit=crop&dpr=1 600w, https://images.theconversation.com/files/45949/original/b42pvsn8-1397024043.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=424&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/45949/original/b42pvsn8-1397024043.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=424&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/45949/original/b42pvsn8-1397024043.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=533&fit=crop&dpr=1 754w, https://images.theconversation.com/files/45949/original/b42pvsn8-1397024043.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=533&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/45949/original/b42pvsn8-1397024043.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=533&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Australia’s coal reserves, including the vast, untapped areas of the Galilee basin in inland Queensland.</span>
<span class="attribution"><a class="source" href="http://www.ga.gov.au/corporate_data/74097/74097.jpg">Geoscience Australia</a>, <a class="license" href="http://creativecommons.org/licenses/by/4.0/">CC BY</a></span>
</figcaption>
</figure>
<p>To develop the mine requires associated development of a rail corridor through to the coast for an additional A$2.1 billion, as well as the extension of the Abbott Point coal export at Bowen. </p>
<p>To meet the costs of these major infrastructure needs, there has to be enough coal. The size of the Carmichael proposal, and other proposed mines in the Galilee Basin by <a href="http://www.gvk.com/ourbusiness/resources/coal.aspx">GVK Hancock</a> (the Alpha Coal Project) and <a href="http://www.waratahcoal.com/galilee-coal-project.htm">Clive Palmer</a> (China First Coal Project) are at the scale needed to justify the huge infrastructure costs required.</p>
<h2>Benefits outweigh the risks</h2>
<p>This change in the scale of development also has implications for the environment. </p>
<p>These can be separated into four main groups: the impacts on terrestrial biodiversity of mine and rail corridor development, the potential impacts on groundwater from the mining operations, the impacts of the port development, including the dredging activities, and the greenhouse emissions associated with extra coal development and combustion.</p>
<p>Although the latter is the focus of criticisms from many environmental groups, emissions are essentially a zero-sum game if Indian power companies such as Adani simply source their coal from other sources. </p>
<p>A generation ago, the potential impacts on terrestrial biodiversity would probably have been the key environmental concern in Australia for a development of this kind. There are some substantial biodiversity impacts identified for the Carmichael Coal project, but the careful impact assessment process that is now required, the conditions imposed by both the Queensland and Australian governments, and the system of offsets that have to be established addresses these much more thoroughly than in the past. </p>
<p>It is notable that the headline environmental concerns now seem to be more focused on the issues where the impacts are much harder to predict with certainty — the groundwater and port development impacts. Again, the Queensland and Australian Government approvals come with strings attached. Adani has to comply with major conditions and offset the predicted impacts. </p>
<p>Ultimately both government approvals processes have judged that the risks of environmental impacts can be managed and that the large economic benefits outweigh those risks.</p><img src="https://counter.theconversation.com/content/29839/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Professor John Rolfe’s work on the resources sector has focused on improving the assessments of the economic and social impacts of mining on communities in Queensland. This has included: Assessment of social and economic impacts conducted for industry in 2003, 2006 and 2011; Research on mining community impacts, labour force and housing issues, funded by the Australian Coal Association Research Program in 2004 and 2007; Research on regional planning and mining developments, funded by the Queensland Government in 2008; Research funded through CSIRO in the Minerals Down Under National Research Flagship from 2009 to 2012. Currently John Rolfe has no projects that relate to or are funded by the resources sector. He has never had any involvement or research with projects in the Galilee Basin, including the Carmichael Coal Project.</span></em></p>The Carmichael coal project, approved this week by environment minister Greg Hunt, is unprecedented in its scale, and also represents a significant shift in Australia’s coal industry. If the mine goes…John Rolfe, Deputy Dean of Research, School of Business and Law, CQUniversity AustraliaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/257152014-05-01T20:44:29Z2014-05-01T20:44:29ZCalling people NIMBYs won’t stop development arguments<figure><img src="https://images.theconversation.com/files/47548/original/nbcgcr6y-1398938126.jpg?ixlib=rb-1.1.0&rect=620%2C419%2C3717%2C2258&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Automatically labelling people as NIMBYs if they have concerns about local power projects is not a constructive way to proceed.</span> <span class="attribution"><a class="source" href="http://commons.wikimedia.org/wiki/File:Royalla_Solar_Farm_2.JPG">Grahamec/Wikimedia Commons</a>, <a class="license" href="http://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a></span></figcaption></figure><p>From coal seam gas to wind farms, new resource projects seem to be pitting communities against corporations, and people against their neighbours. We often see, in such cases, community concerns labelled as “not in my backyard” – the dreaded “NIMBYism”. But calling someone a NIMBY misses the point — if development decisions were really made with community concerns in mind, there would be less conflict. </p>
<p>Some decisions have left unhappy and anxious communities in their wake. In the tiny town of Uriarra, near Canberra, residents have <a href="https://www.facebook.com/uriarrasolarfarm">complained about what they say is a lack of procedural fairness</a> in the way the ACT government has apparently decided on a nearby <a href="http://www.elementusenergy.com.au/Elementus_Energy/OneSun_Capital.html">solar farm development</a>. It got so rancorous that solar power firm Elementus Energy has even <a href="http://www.canberratimes.com.au/act-news/company-behind-uriarra-solar-farm-plan-hires-pr-firm-to-win-debate-20131011-2vcj8.html">hired a PR firm to try and win the locals over</a> before it is formally approved.</p>
<p>Could some of this discontent be avoided? Yes, if we restore a sense of fairness to decisions on resource projects. Difficult decisions do need to be made, despite widely differing positions and attitudes. This is not about achieving full consensus, or persuading people with impossibly trenchant views – it’s about making fair decisions through fair processes in which people’s concerns are taken seriously.</p>
<h2>An unhelpful label</h2>
<p>The NIMBY label, as well as other derogatory names like zealot or Luddite, is a double injustice to those on the receiving end. </p>
<p>The first is that the NIMBY description fails to take into account people’s genuine issues and questions about a variety of potential impacts. These include noise, air and visual pollution, increased traffic, effects on health, future social and economic impacts on the lives of local inhabitants and short- and long-term damage to the environment. </p>
<p>It seems facile to label people as NIMBYs for opposing coal mines such as <a href="http://gvkhancockcoal.com/assets/thermal-coal-developments/alpha">GVK Hancock’s Alpha project</a> in Queensland, or the proposed expansion by <a href="http://www.riotinto.com/energy/rio-tinto-coal-australia-4713.aspx">Rio Tinto Coal Australia</a> of its Warkworth open cut mine in New South Wales. Both projects went to court; the Alpha project has been <a href="https://theconversation.com/alpha-coal-ruling-breaks-new-ground-for-protecting-water-25426">recommended for rejection or stringent groundwater conditions</a>, and the Warkworth mine proposal was <a href="http://www.businessspectator.com.au/article/2014/4/7/resources-and-energy/rio-loses-appeal-over-warkworth-mine">rejected outright</a>.</p>
<p>The second problem is that the term NIMBY is a disdainful put-down, which comes with an inbuilt sense of derision. People are seen as selfishly putting their own interests ahead of the rest of society.</p>
<p>We need to understand that being called a NIMBY and having one’s genuine concerns ignored is disrespectful and unfair. People are concerned about the security of their family, their community and their livelihood. Labelling these concerns as purely self-interest is not a constructive way to proceed. </p>
<h2>Doing better</h2>
<p>Let’s take wind energy as an example. Proposals for wind farms across the nation have resulted in divided local communities becoming the norm, rather than the exception. Division is also apparent in the media where much of the debate has coalesced around those who are strongly in favour of renewable wind energy and those who are opposed to it.</p>
<p>So what can be done? In making decisions and policy, we need to bring communities with us. If we don’t, these projects have no hope of achieving social acceptance locally, or even broadly in society. </p>
<p>The chain of fairness works something like this: a fair decision-making process is more likely to lead to a fair decision and consequently greater community acceptance of a decision.</p>
<p>Communities can demand fairness in decision-making processes. Those who believe that they will carry the local burden of a development in their district can legitimately expect a full explanation of the rationale for the project if they are to support it as a benefit to society at large. </p>
<p>People have many expectations from decision-making processes about matters that may affect them. These include being able to participate in the process and being given enough information, discussing the potential impacts and how adverse ones might be resolved, having their questions answered, and having a say in the final decision. </p>
<p>Importantly, they also expect to be treated with respect. This means that opinions should be valued, that people should be dealt with honestly, and that they are recognised as having a legitimate interest in the final outcome.</p>
<h2>Three pillars of fairness</h2>
<p>While there are many ideas and theories about fairness and justice there are three important pillars of fairness that are of practical value here. These are:</p>
<ul>
<li><p>fairness in how people are treated (<a href="http://en.wikipedia.org/wiki/Interactional_justice">“interactional” justice</a>) </p></li>
<li><p>fairness in the process by which a decision is made (<a href="http://en.wikipedia.org/wiki/Procedural_justice">“procedural” justice</a>)</p></li>
<li><p>fairness in how a resource, benefit or burden is distributed (<a href="http://en.wikipedia.org/wiki/Distributive_justice">“distributive” justice</a>).</p></li>
</ul>
<h2>Finding the middle ground</h2>
<p>Of course, the ultimate decision is not going to please everybody. People at the extremes of an issue – those with an overriding support for it, or those who implacably oppose it – are unlikely to change their attitudes, irrespective of the process.</p>
<p>Those with loud voices can drown out the majority in the middle, from whom social acceptance is sought and gained. It is this group that decision-makers need to bring along with them, not those on the fringes. </p>
<p>A fully informed debate that seeks to understand perspectives from all angles can help people find the middle ground and a workable solution. Everyone has a responsibility to listen to other perspectives, understand them, and take part in a debate in which people are treated with respect. </p>
<h2>Fairness to help communities decide</h2>
<p>An unfair process is one where a decision is imposed on a community. When this happens, communities become resentful, relationships are strained, and divisions appear. Introducing a community consultation process after a decision has been made, as seems to have been the case with the Uriarra solar farm, is akin to closing the stable door after the horse has bolted. The damage has been done and people feel insulted. </p>
<p>Governments and corporations should not make decisions behind closed doors, even if they are “apparent decisions”, and still expect to bring the community with them. </p>
<p>People in communities can demand from those responsible a fair decision-making process, so that a reasonable and well-informed discussion can take place. </p>
<p>Communities should demand fairness in these three areas: in the way they are treated, in decision-making processes, and in the sharing of resources and burdens.</p>
<p><em>Catherine Gross is the author of <a href="http://www.routledge.com/books/details/9780415833899">Fairness and Justice in Environmental Decision Making: Water Under the Bridge</a>.</em></p><img src="https://counter.theconversation.com/content/25715/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Catherine Gross does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>From coal seam gas to wind farms, new resource projects seem to be pitting communities against corporations, and people against their neighbours. We often see, in such cases, community concerns labelled…Catherine Gross, Visiting Fellow, Fenner School of Environment & Society, Australian National UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/122902013-02-28T03:18:20Z2013-02-28T03:18:20ZDuelling dynasties: Nat Rothschild is no king coal in the boardroom battle for Bumi<figure><img src="https://images.theconversation.com/files/20751/original/krj8ty38-1362016761.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Aburizal Bakrie and Nathaniel Rothschild have been engaged in a protracted battle for control over Indonesian mining giant Bumi plc.</span> <span class="attribution"><span class="source">Flickr\I am Rudy</span></span></figcaption></figure><p>Last week saw a <a href="http://www.ft.com/intl/cms/s/0/546175f4-7c25-11e2-bf52-00144feabdc0.html">shareholders’ meeting of the mining company Bumi plc</a> in London.</p>
<p>Shareholders meetings are hardly unusual events. But this was no ordinary shareholders meeting. It involved a major Indonesian coal mining concession, and pitted two powerful businesspeople against each other.</p>
<p>One was <a href="http://www.forbes.com/profile/nathaniel-rothschild/">Nathaniel Rothschild,</a> a member of the Rothschild dynasty, well-established in the commercial worlds of Europe and North America, where the very name Rothschild stirs up images of wealth and power.</p>
<p>The other player is less well-known internationally: the Indonesian businessman <a href="http://www.forbes.com/sites/laurahe/2012/11/28/presidential-contender-aburizal-bakrie-drops-off/">Aburizal Bakrie.</a></p>
<p>Bakrie is one of Indonesia’s most powerful men. He is a major shareholder in (and former chair of) the Bakrie Group, a massive family conglomerate with interests in mining, plantations, education and the media, amongst others. He is also the chair of <a href="http://www.golkar.or.id/">Golkar</a>, the political party founded during the Suharto regime and for many years the electoral flagbearer for the former president. He is currently Golkar’s candidate for the presidential elections due next year, and already running hard in campaign ads on television.</p>
<p>He is a controversial figure for many Indonesians, and the combination of his political and business interests frequently draw adverse comment. Two years ago, for instance, he effectively brought down the best finance minister Indonesia had seen for decades, Sri Mulyani, in what was widely seen as a dispute over his payment – more accurately, non-payment – of taxes. Not a man you should lightly cross.</p>
<p>How did Bakrie and Rothschild get into business together?</p>
<p>In 2011, Bakrie moved his shareholding of the Indonesian-registered company Bumi Resources, owners of a major coal mining concession, into an investment vehicle set up by Nathaniel Rothschild, and subsequently renamed Bumi plc. Bakrie’s idea was to tap European sources of capital for Bumi Resources, without having to go though the difficult process of listing on the London Stock Exchange. Rothschild would gain access to a valuable coal mining concession in Indonesia, the world’s largest exporter of thermal coal.</p>
<p>Initially, the partnership seems to have worked well. But within a year of its establishment, tension between Bakrie and Rothschild over control of the enterprise became public.</p>
<p>Eventually, Rothschild moved to dismiss the Bakrie-appointed directors from the Bumi board, and Bakrie declared that he had had enough of the whole affair, and had decided to pull out, and to buy back Bumi Resources from Bumi plc.</p>
<p>This conflict was further fuelled when the British Takeovers Panel ruled that Bakrie and two other Indonesian corporate shareholders in Bumi plc were <a href="http://www.thetakeoverpanel.org.uk/wp-content/uploads/2012/01/2012-9.pdf%5D">acting in concert,</a> and therefore in violation of the Takeovers Act. </p>
<p>The shareholders meeting in London last week came out in favour of Bakrie: only two of Rothschild’s resolutions were passed, and Bakrie remained in control of the majority of directorships of the company. His <a href="http://online.wsj.com/article/SB10001424127887324503204578318121438857926.html%5D">divestment plan is moving ahead.</a></p>
<p>Is the conflict fundamentally about corporate governance and “emblematic of institutional investors’ worries about governance of foreign resources firms listed in London” as at least <a href="http://www.cnbc.com/100454787">one commentator has suggested</a>– as if only “foreigners” (presumably, non-Brits) are ever guilty of dubious business practices? Or is it really simply a clash between two very wealthy, very strong-willed businessmen over control of a valuable mining asset? </p>
<p>A bit of both, probably, but I suspect primarily the latter.</p>
<p>Any businessperson worth their salt knows that investing in Indonesia is a risky business. Relying on the courts to enforce contract conditions is foolhardy. Contracts stand and fall on the basis of the personal relationships the parties have, with each other and with other business and political players.</p>
<p>Rothschild is an experienced businessman. It is possible that he went in to the deal with Bakrie without knowing the nature of the person he was dealing with. Possible – but unlikely. In any case, it would have taken only a few minutes research to find out that Bakrie has a reputation for being a very canny operator.</p>
<p>Ironically, Rothschild demonstrated he is perfectly well aware of the links between business and politics in Indonesia when he proposed replacing Bakrie in Bumi plc with fellow Indonesian businessman <a href="http://www.forbes.com/profile/hashim-djojohadikusumo/">Hashim Djojohadikusumo.</a></p>
<p>Hashim has business interests <a href="http://www.thejakartaglobe.com/coverstory/hashims-new-horizons/495099">ranging from mining to agriculture to nature conservation</a>, and a net worth reputedly just shy of $1 billion.</p>
<p>But he also just happens to be the brother of Prabowo Subianto, former son-in-law of the late President Suharto and currently leader of the Gerindra party and its <a href="http://www.thejakartaglobe.com/business/hashim-talks-business-politics-and-crisis/300649">declared candidate for the 2014 presidential election</a>. Hashim was a co-founder of Gerindra, and still sits on its Board of Trustees.</p>
<p>Perhaps Rothschild simply wanted to bring Hashim’s business experience to Bumi plc.</p>
<p>Perhaps he gave no thought to Hashim’s political connections.</p>
<p>Perhaps.</p>
<p>But Rothschild might actually have faced an even bigger problem had he won control of Bumi. There is <a href="http://theconversation.com/challenges-for-investors-amid-indonesias-foreign-ownership-regulations-5882">growing economic nationalism in Indonesia,</a> directed largely at the mining industry. How long a foreign-registered company such as Bumi plc could have continued to mine Indonesian coal is a moot point.</p>
<p>Possibly, in the long term, Rothschild may benefit financially from his loss of control of Bumi.</p>
<p>Coal’d comfort?</p><img src="https://counter.theconversation.com/content/12290/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Colin Brown does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Last week saw a shareholders’ meeting of the mining company Bumi plc in London. Shareholders meetings are hardly unusual events. But this was no ordinary shareholders meeting. It involved a major Indonesian…Colin Brown, Adjunct Professor, Griffith Asia Institute, Griffith UniversityLicensed as Creative Commons – attribution, no derivatives.