Forcing the coal industry on its environmental knees
Image: The Hunter Region's Lemington coalmine. Thanks to Hunter Valley Gliding Instructor Morgan Sandercock of www.sandercock.com
The judgment against Centennial Coal's Anvil mine by the New South Wales' Land and Environment court was a blow for the coal industry, but a giant - albeit potential - win for the planet.
Remarkably though, the issue of environmental damage of coal mining in the Hunter region brought together on the same side of the table some very unlikely partners: shock-jock Alan Jones in his role as an owner of a horse stud, a 26-year-old student from Newcastle Peter Gray, who brought the case against Anvil, environmentalists, and wine growers from The Hunter.
Below, a summation of the issues by Sydney Morning Herald's Environment reporter Wendy Frew, who also starts on the contentious issue of carbion sequestration to conclude the contents of this page.
11 March 2006: Burning Coal and burning the planet - The Australian Labor Party has just released its environmental policy blueprint, and on the face of it, the policy looks 'half decent', but, as always needs to be asked, is the ALP policy all it's stated to be? And, how vulnerable is the stated target of cutting greenhouse gas emissions by 60% by 2050?
15 September 2005: Friends of the Earth Australia: A Citizens Guide to Climate Refugees - While the Earth has always endured natural climate change variability, we are now facing the possibility of irreversible climate change in the near future. The increase of greenhouse gases in the Earth's atmosphere from industrial processes has enhanced the natural greenhouse effect.
5 January 2005 - Changing worlds: the coming of envirogees - In the last week of 2004, when undersea earthquakes followed by tsunamis seriously impacted on countless local communities, the entire world was given a wake-up call which none of us can afford to ignore. An article by Project SafeCom's Jack Smit.
Sydney Morning Herald
Wendy Frew, Environment Reporter
November 29, 2006 - 1:04PM
The climate-change impacts of new industries, including burning coal extracted from NSW mines, will have to be considered by the State Government following a landmark judgement on Monday.
While the decision, delivered in the Land and Environment court, does not block the mine's development entirely, Justice Nicola Pain ruled the Government will now have to take account of the greenhouse gas emissions from burning the mine's output - even though 80 per cent will be exported.
The environmental assessment of Centennial Coal's proposed Anvil Hill coalmine at the centre of this week's decision, was a Clayton's assessment; the assessment you do when you don't want to admit the project being assessed will lead to a lot of greenhouse gas pollution.
Centennial Coal wants to dig up 10.5 million tonnes of coal a year from Anvil Hill in the Upper Hunter, for the next 21 years. It will dig up that coal for the express purpose of selling it to power stations in NSW and Japan. Those power stations will burn the coal to generate electricity.
When you burn a tonne of coal you generate 2.4 tonnes of CO-2, the Australian Greenhouse Office says. Over 21 years, the coal from Anvil Hill will pump 529 million tonnes of greenhouse gas pollution into the atmosphere - regardless of where it is burnt or who burns it.
Britain's Stern report put a $US85 price on a tonne of CO2, taking into account climate change's effect on human health, the environment, agriculture, industry and infrastructure. On that basis, the coal from Anvil Hill will be responsible for $A58 billion worth of climate change damage in less than one generation.
The output of the mine will be one of many human activities that are already raising global temperatures and sea levels, changing rainfall patterns and, in this country, delivering more and fiercer droughts and bushfires. That's a pretty big environmental impact.
The NSW Government receives millions of dollars every year from coalmines in the form of royalty payments. The number of jobs created by coalmining has declined significantly in the past few decades because of mechanisation but the ALP is under pressure from unions to protect the remaining jobs.
So, its no surprise the Government did not want to draw attention to the link between coal exports and climate change when it accepted Centennial Coal's environmental assessment.
There is bipartisan support on this issue. Launching his environmental blueprint in March Federal Opposition Leader Kim Beazley endorsed coal as a long-term source of power.
"We have 300 years' worth of coal reserves in this country," he told reporters.
"There is always going to be a requirement for it so ... we have to make sure that industry can progress within an environmentally friendly context."
Mr Beazley was referring to so-called clean-coal technology that, at best, might be commercially effective in 10 years' time, assuming all the carbon captured from gas and coal plants and then pumped underground, stayed there.
The Prime Minister made it clear earlier this month that he shared that view when he said that, although he was willing to consider a scheme to trade carbon in the hope it would direct investment to cleaner forms of power, he had no intention of damaging the Australian economy by making electricity more expensive for energy-intensive industries such as aluminium and cement.
"I have indicated in the past that I don't intend to preside over policy changes in this area that are going to rob Australia of its competitive advantage in the industries that are so important to us," he said.
He has stuck to that line of reasoning even in the face of evidence from the Stern report that the economic cost of not tackling climate change was far higher than taking action to reduce greenhouse gas pollution.
Peter Gray was one person sick of hearing these arguments. The 26-year-old classics student from Newcastle knows we can't close down the coal industry tomorrow.
However, he believes governments should, at the very least, assess, and tell the public about, the true cost of Australia's reliance on coal as a source of cheap electricity and an export earner.
That's what his case in the Land and Environment Court was all about. Justice Nicola Pain agreed.
On a number of points of law, she found that the view formed by the director-general of the Planning Department, that the environmental assessment lodged by Centennial addressed the director-general's own requirements, was "void and without effect".
She found the Government could not dismiss the climate change impact from the burning of the coal.
"Climate change/global warming is widely recognised as a significant environmental impact to which there are many contributors worldwide but the contributors globally does not mean the contribution from a single large source such as the Anvil Hill Project in the context of NSW should be ignored in the environmental assessment process," Justice Pain wrote.
"The coal intended to be mined is clearly a potential major single contributor to greenhouse gas emissions deriving from NSW given the large size of the proposed mine.
"That the impact from burning the coal will be experienced globally as well as in NSW but in a way that is currently not able to be accurately measured, does not suggest that the link to causation on an environmental impact is insufficient."
The judge also noted a failure by the director-general to take the principle of inter-generational equity into account (that is, the climate change pollution being generated now will hurt future generations), and said there was a role for the precautionary principle, "the need for careful evaluation to avoid serious or irreversible damage to the environment and an assessment of the risk weighted consequences of various options".
This decision won't stop Anvil Hill from going ahead. Nor does it blame Centennial Coal for going about its business. We all benefit from cheap coal to power our homes and businesses. But - among other things such as our cars, and land clearing - that cheap coal is poisoning our atmosphere in a way that threatens our climate, our environment and our safety. This decision makes it clear we can no longer ignore those consequences.
Australia's biggest export industry, under pressure over climate change, also faces attack on other fronts. Wendy Frew reports.
Sydney Morning Herald
December 2, 2006
The executives of Centennial Coal thought they had found the perfect place for their annual meeting, in the bowels of the Menzies Hotel in Carrington Street in Sydney central business district, away from public view and protesters. Australia's largest independent coal company had been attracting media attention because of its proposed giant mine at Anvil Hill, in the Upper Hunter Valley, and executives feared its meeting would be disrupted by environmental activists.
Police suggested the Menzies had the "most secure room in Sydney" and provided a handful of plainclothes officers in case there was any trouble. But it was to no avail.
The meeting hadn't been going long when 11 environmental activists burst through a fire door. "We are here because Centennial Coal has plans to massively increase its coalmining in the Hunter Valley," Greenpeace's energy campaigner, Mark Wakeham, proclaimed to a room full of startled investors.
The protesters were quickly bundled back onto the street while Centennial's executives recovered their composure.
The company is not the only coalminer under the spotlight.
In NSW there is a rising tide of public opposition to the industry because of the greenhouse gases generated when coal is burnt. There are also concerns about the threat to water supplies posed by open-cut and long-wall mining and the displacement of other industries, such as thoroughbred breeding, winemaking, farming and tourism, as mining encroaches into new territory.
In the past the industry has been able to brush off the complaints. Employing tens of thousands of workers, providing hundreds of millions of dollars in state royalties revenues, supplying cheap power to industry and making a huge export contribution, it received bi-partisan political support.
But times are changing. Coal is widely recognised as a major climate change culprit that is contributing to rising global temperatures and sea levels, and more frequent and more fierce storms and bushfires.
The industry's economic credentials are looking weaker, too, after an analysis released by the British Government in October concluded that the economic cost of ignoring climate change was far greater than the cost of cutting greenhouse emissions.
Pressure is being applied to the industry from new and unlikely sources. The retailer Gerry Harvey, the ad man John Singleton and the broadcaster Alan Jones, for example, are angry about the threat from coalmining to the Upper Hunter's thoroughbred industry, in which they have invested millions.
On Monday - three days after Centennial Coal's managing director, Bob Cameron, told shareholders at the annual meeting Anvil Hill would be "a very environmentally friendly mine" - another bombshell landed on the industry. The NSW Land and Environment Court ruled the climate-change impacts of new industries, including burning coal extracted from NSW mines, would have to be considered by the State Government.
It was a landmark decision that threw industry and government into a spin, not because it would necessarily block the mine but because the greenhouse pollution from the coal, regardless of where it is burnt, must be taken into account.
This interpretation of coal's environmental damage sounded a warning bell to other industries that contribute to global warming, legal experts say. "You are digging up the coal and selling it with the express purpose of it being burnt," said the director of the Environmental Defender's Office of NSW, Jeff Smith.
"When you build an airport you are building it to facilitate the movement of aeroplanes, which create greenhouse gases," says Smith, explaining the broad implications of the Anvil Hill ruling.
Smith and others say the deeper significance of the ruling lies in its political implications. "The State Government can appeal the decision but would they? Because that would send a very odd message to the public," he says. "They would have to look the public in the eye and say, 'I have looked at the climate change impact but I am going ahead anyway."'
There is a broader implication about Australia's energy sources, says the executive director the Australia Institute, Dr Clive Hamilton. "People have to accept they have to pay more to have cleaner forms of energy. I think they will get used to that idea but there are a lot of historical ideas and prejudices to overcome," he says.
Weaning Australia off the coal nipple will not be easy. "It would be a big structural change to our electricity industry, perhaps the biggest structural change in Australian history," Hamilton says. "When you get involved in this issue one of the things you learn is just how deeply involved in government these major industry sectors are. They are so intimately engaged in public decision-making. To make progress on climate change you have to break 1000 personal connections between business and government."
The nature of some of those connections is being examined in Queensland where the Crime and Misconduct Commission is investigating a $300,000 private loan from Macarthur Coal's chief executive, Ken Talbot, to a former health minister, Gordon Nuttall.
Hamilton says the Anvil Hill ruling may have finished stage one of putting pressure on the coal industry but there could be several more to go.
But the palaeontologist and author Tim Flannery says there might not be time to go through those stages. "The biosphere is changing very rapidly in a negative way," says Flannery, who has been keeping track of scientific research on the melting of the world's ice caps and ice sheets.
"We are already seeing unusual events here, the historically low flow in the Murray-Darling being the most obvious. These are unusual events but they are exactly what the computer models predicted."
The high-profile scientist, who drew attention to climate change with his book The Weather Makers, says there is increasing pressure on the coal industry because of its greenhouse gas pollution. However, he believes governments will fail to act in time, forcing Australia to walk away from some of its energy assets.
"You have Queensland developing a new coal-fired power station and expanding its Gladstone port [for coal exports] ... I think these things are going to look like Easter Island statues - stranded."
NSW is also gearing up for a bigger coal industry. A $530 million coal terminal planned for Newcastle port will be able to handle another 30 million tonnes of coal on top of annual exports now of 80 million tonnes. The expansion is needed to accommodate more than a dozen coalmining projects on the drawing board for the Hunter.
Anvil Hill is among the bigger mines planned for the Upper Hunter. BHP Billiton has its sights set on hundreds of millions of tonnes of high-quality coal in the Caroona Basin, under the Liverpool Plains, south-west of Tamworth. This year it paid the NSW Government $100 million for the rights to explore the basin.
The district has some of the richest soil in Australia. A fifth-generation farmer, Tim Duddy, helped form the Caroona Coal Action Group of farmers who are upset the exploration and subsequent mining could cause land subsidence and damage aquifers that they rely on for water. They are incensed that, at a time when farmers have suffered large cuts to their groundwater licences, BHP is contemplating drilling into the aquifers to test the reserves. "Like a cup that is cracked, once an aquifer is damaged it can never hold water again," says Duddy.
Precious water supplies are also on the minds of Australia's leading thoroughbred breeders. Around Scone in the Upper Hunter, tens of millions of dollars have been sunk into horse studs.
Opposition to coalmining in this district is focused on a proposal by Bickham Coal Company for an open-cut mine, 25 kilometres north of Scone. The site is close to the upper reaches of the Pages River, a tributary of the Hunter, and sits above a valuable source of groundwater.
Australia's second-biggest horse breeder, Gerry Harvey, has little confidence the mine operator or the State Government will put water ahead of the money to be made from coal. "If the Government could give us a 100 per cent guarantee it won't contaminate the water table, then fine," he said. "But they can't do that. It doesn't matter what report they get, they cannot be sure."
The journalist Patrice Newell, now an organic farmer at Gundy, said credit should be given to the Government for making Bickham Coal undertake a comprehensive water resource assessment before any development application could proceed. But she said there was a lot riding on it.
"If you wreck that underground supply of water, which is what coalmining does ... then you could have a massive impact on the surface flow."
The Minister for Natural Resources, Primary Industries and Mineral Resources, Ian Macdonald, says it is sustainable for the State Government to keep approving coalmines and rejects claims the mines could cause substantial damage to rivers and aquifers.
"Problems can arise and they can be rectified. We have [financial] bonds from the company," Macdonald says. "The coal industry provides an enormous economic benefit to NSW in the order of $600 million in royalties, 20,000 jobs, and hundreds of millions of dollars on top of that stays in the state."
He is confident technology being developed around the world will capture the carbon emitted when coal is burnt and store it underground. In line with its federal counterpart, the NSW Labor Party supports signing the Kyoto Protocol, an international treaty on climate change, and wants to see a price on carbon that would encourage investment in cleaner energy sources such as wind and solar power.
In the meantime the Government is happy to ride on the back of the coal truck and does not believe it should be held responsible for the greenhouse emissions generated when coal originating in Australia is burnt overseas. "I don't see why we should not make money out of it," says Macdonald.
It is a view shared by the industry. It dismisses calls from groups such as Greenpeace and the Greens to place a moratorium on new mines as irresponsible.
"Withdrawing our coal exports to crunch supply in the hope of encouraging the use of alternative sources of energy wouldn't even rate a hiccup," says the chief executive of the NSW Minerals Council, Dr Nikki Williams. "World coal consumption is roughly 5 billion of tonnes per year. Our state exports around 89 million tonnes per year, so it is a drop in the ocean compared to the global demand and consumption...
"It's important to point out that when the industry says, 'If we don't dig it up, someone else will', it is not to ignore the problem or our role in the solution.
"What we're saying is, 'Look, what we do is not perfect but we're working on the solution. In the meantime we're keeping the lights on, driving the economy, creating jobs and attracting investment to our state."'
The solution state and federal governments and the industry are betting on is so-called clean coal, and billions of dollars have been committed to a range of research projects and demonstration plants.
A spokesman for the Australian Coal Association, Doug Holden, says the industry's confidence in the technology relies on work being done by groups such as the International Energy Agency.
The agency says the technology now being developed could play a significant role in reducing the release of greenhouse gases but it would have to be deployed on a massive scale to make any difference and would add at least US1.5 cents (1.9 cents) per kilowatt hour to the cost of electricity generation.
However, even this agency admits, "In the long-term the world's energy system may have to be based on non-fossil energy sources."
The NSW Central Coast is looming as the next David-and-Goliath battle on the coal front. A group of influential and well-organised locals who managed to drive methane gas miners out of the Dooralong and Yarramalong valleys last year is now targeting a South Korean Government-owned coalminer, Kores.
Kores wants to dig up 5 million tonnes a year of export thermal coal for the next 40 years, at a site not far from The Entrance. The company would use longwall mining techniques and build a coal handling plant, storage facilities, a rail loop and loading infrastructure.
Tony Davis, a Dooralong Valley resident and former barrister who provides legal advice to the action group, claims the mine could put the Central Coast's water catchment at risk. He also says the mine's greenhouse gas emissions should be taken into account.
"The present system for approving of mining operations is a joke," says Davis, whose previous battle against Sydney Gas enlisted the help of high-profile residents such as the former NSW premier Neville Wran and the broadcaster John Laws.
"What happens in practice is that the mining company produces, at their own expense, and with their own chosen people, an environmental impact statement," he says.
"Anybody with an iota of intelligence would comprehend that when you pay enough, you will get the results that you want, and even if you got a result you didn't like you put it in the rubbish and try another person."
Davis claims that at a meeting with the NSW Minister for Mineral Resources, Ian Macdonald, he was told the State Government did not have enough money to conduct independent assessments.
"A ridiculous answer as, of course, all one needs to do as a government is have a suitable application fee lodged with each application and then for the environmental reports to be prepared by one of a panel of independent experts," Davis says.
Macdonald says the Government has confidence in its environmental assessment process. "The requirements on the company to prepare assessment reports are quite rigorous and these reports are considered by appropriate experts within government," he says.
A spokesman for Kores Australia, Peter Smith, said the company had promised to safeguard the local water supply.
"We will keep going back to the drawing board until we get it right," he told ABC radio on Thursday. "We are taking less coal than we would like to protect the water."
On its website, Kores says the underground mine will not affect groundwater supplies.
It also says the company will be responsible and liable for any temporary or permanent loss of bore water as a result of mining.
Australia earned $25 billion from coal exports in 2005-06, making it the single biggest commodity export by value.
Australia is the biggest coal exporter in the world, holding 30 per cent of the market. Most of that coal goes to Japan.
Australia's open-cut and underground coal mines employ about 30,000 people.
In NSW mining consumed 63 billion litres of water in 2004-05, 62 per cent of that in coalmining. Manufacturing used 126 billion litres, while cotton farming took up 964 billion litres.
A third of all CO-2 emissions due to human activity come from burning fossil fuels to generate electricity.
A Queensland Government project is likely to be the first demonstration of carbon storage on a commercial scale.
Sydney Morning Herald
Wendy Frew, Environment Reporter
December 2, 2006
TECHNOLOGY to capture and store carbon pollution from a coal-fired power station on a large scale will be operating at only a handful of sites around the world by 2020, a coal industry report says.
There are nine large carbon capture and storage experiments under way, according to an international coal lobby group, the World Coal Institute. But even if they all stay on schedule, they will only be able to dispose of carbon generated from the equivalent of about four large coal-fired power plants.
"The race is on to have the first coal-fired carbon capture and storage demonstration project operating at a commercial scale," said the institute in a report issued on Tuesday. "A number of projects are vying for the honours in Australia, Canada, Germany, the UK and the USA."
None of the nine projects is in China, where coal consumption for electricity is expected to grow sharply in coming decades.
Australian governments and the coal industry believe rising levels of atmospheric greenhouse gases cannot be cut without carbon capture and storage.
But environmental groups and some geologists have questioned the viability of the unproven technology. They say the world cannot afford to wait and see if carbon capture and storage works.
The Queensland Government-backed ZeroGen project, expected to come on line by 2010, aims to build a demonstration plant producing baseload electricity. The carbon dioxide will be injected into deep salt-water aquifers.
A spokesman for ZeroGen said yesterday that the technology would probably not be applied to existing power stations but could be sold to the builders of new coal-fired plants.