Australian Coal Association: “Cut Emissions- not coal”

By Zane Alcorn

If you have heard the concerning rumours that the Copenhagen summit is not going to produce the type of strong international agreement needed to stop dangerous climate change, and were wondering why, look no further than Australia: the world’s largest coal exporter. Bear witness to the Australian Coal Association (ACA)’s ‘cut emissions- not jobs’ campaign, a poetic example of how the global coal industry (and indeed fossil fuel industry more broadly) is likely to react as dangerous anthropogenic warming becomes more obvious.

The ACA is spending tens of millions of dollars on a barrage of television and newspaper advertisements trying to convince coal workers and mining communities that the Australian Government’s proposed Carbon Pollution Reduction Scheme (CPRS) will cause Australian coal mines to close and thousands of workers to lose their jobs.

The scheme, which the Australian Greens have dubbed the ‘Continue Polluting Regardless Scheme’ proposes a pathetic emissions reduction target of 5% on 1990 levels with billions of dollars of free emissions permits for coal companies, aluminium smelters and coal fired generators. And yet the ACA is still attacking it; partly to try and extract yet more concessions from the government, but also to try and turn coal communities against the climate movement by telling coal workers the corporations are their best friends and that there can be no alternative livelihood for mining workers other than in coal.

Unions face off
The mining workers union, the CFMEU, has run a series of counter advertisements, saying that the ACA adverts are a scare campaign aimed at extracting yet more free pollution permits before the legislation is voted on in the Australian Parliament; and that the coal industry is set to expand massively even under the CPRS.

A September 28 media release by the union states “Central Queensland coalmine worker, Shane Brunker said that the [CPRS] was needed to protect the future of coalmining jobs and regional communities against climate change.”

“Real coalmine workers and their families know that we need to clean up our industry and cut carbon emissions to protect our jobs and our communities against the impact of dangerous climate change,” Mr Brunker said.

“The long term future of regional coal communities like mine depend on the acting against climate change now.”

Not consistent
The CPRS is nowhere near consistent with the depth of cuts required of big emitters like Australia if runaway warming is to be avoided, and yet even the weak cuts it proposes are coming under fire from the ACA. The Australian Labor Party government, which lacks a majority in the senate, could easily have tabled strong climate legislation which if voted down could have acted as a trigger for a ‘double dissolution election’ in which both houses of parliament are dissolved and elections held. This is in contrast to regular elections in which only half of the senate faces the ballot box; a double dissolution election allows the government to try and achieve a majority in both houses, and thus to pass legislation which had previously been blocked in the upper house.

Instead the Government is claiming its best course of action is to pass weak legislation by diluting it to a level satisfactory to the conservative opposition, in order to, in the words of Prime minister Kevin Rudd “step up to the plate” and “rise to the challenge” in Copenhagen.

False claims
One of the “cut emissions- not jobs” advertisements falsely states that Australia exports $50billion worth of coal per year, an absurd claim given that the ACA’s own website states coal export value totaled

• d $22.5billion in 2006-7.

But the central claim of the ACA campaign is that the mass layoffs the CPRS will supposedly cause (as dozens of Australian coalmines close) would all be for nothing, since “coal mines overseas will immediately produce more to fill the gap”.

This may be true if there were a few isolated closures, but not if we considered a major phasing out of Australian coal exports, in particular steaming coal for power generation. The Australian climate movement is campaigning both for local coal fired plants to be replaced with renewables, but also for coal exports to be phased out and alternative jobs provided for coal communities.

Phasing out Aussie coal exports
Just because the bulk of the worlds coal is produced in Russia, China, India and the USA, this does not mean that those countries are poised to abandon their (domestic) use of tens of millions of tons of the product in order to expand their exports. All four of those countries have an interest in value adding to the resource by using it to fuel an expansion of their own economy.

Likewise the Latrobe Valley in Australia, which has mines feeding adjacent power stations, could not immediately shift to exports, because the necessary rail and port infrastructure has not been built. So too it is folly to suggest that because other countries have large domestic use of coal they can therefore ‘immediately’ switch to exports. Domestic coal production does not equal instant export capacity.

Indonesia, the second largest coal exporter in the world, recently announced it was capping exports at current levels of arountd 150 mtpa in order to retain reserves for domestic use.

The entire arctic ice cap is projected to melt within the next few years, which is likely to have a truly earth shaking effect on the global climate debate. Full artic melt and the resultant albedo flip is truly the final canary in the coalmine of runaway warming. Stopping Greenland (and the methane rich clathrates of the arctic tundra and seafloor) from melting will indeed be a delicate operation once the arctic starts departing each northern summer.

But putting that aside for the moment, lets assume that Australia phases out its ~125mtpa of steaming coal exports by about 2015, instead of expanding to 180mtpa or more which is the current game plan.

Other countries, immune from the community opposition which shut down the Australian industry, and unfazed by the arctic melt, embark on a massive rollout of new mines, new rail lines, new coal carriages and engines, and new coal loaders and port infrastructure.

How do we replace the ~180million tons of steaming coal Australia was to be exporting by 2015?

International steaming coal trade
According to the US government Energy Information Administration’s international energy outlook 2009, “From an 8-percent share in 2007, Eurasia (primarily Russia) is expected to supply 9 percent of the coal traded internationally in 2030”. Lets say Russia fast tracked its expansion and hit its 2030 export projections by 2015. That takes care of 23million tons per annum (Mtpa) of new coal exports.

According to the EIA China’s exports of steaming coal are projected to drop from 55mtpa now to 41mtpa in 2015 and staying there through 2030 due to increased domestic demand. But for arguments sake lets pretend China finds an extra 7mtpa to ship.

Lets also assume that Indonesia breaks its self imposed cap on exports and ships an extra 20million tons above its self imposed cap of 150mtpa, and the United states squeezes another 5mtpa even though they are projected to remain steady at about 25mtpa through to 2030.
So far in this (fairly optimistic) scenario we have replaced 55mtpa of the massive hole in steaming coal exports left by a phase out of the Australian industry. And we are left with just two major producers to replace the remaining 125mtpa: South America (mostly Colombia) and South Africa.

Southern coal boom?
The EIA predicts South America will be exporting 116mtpa in 2015, an increase of about 36mtpa on current levels; and that South Africa will be producing about 100mtpa, up from about 75mtpa currently.
South America and South Africa are the main areas projected to show significant growth in steaming coal exports in coming decades.

Lets assume that those countries add an extra 20million tons of exports each by 2015 on top of the quite vast expansion already planned, in order to, in the words of the ACA ‘immediately replace’ a shortfall in Australian coal exports.
Even under this very optimistic scenario, we have in total only replaced 136mtpa of the 180mtpa of Australian steaming coal that has been phased out by 2015.

We are saving 44million tons of coal per year from being burnt, which would have released some 120million tons of carbon dioxide into the atmosphere.

But it gets better. The overall drop in steaming coal supplies globally sent the price of coal through the roof and forced the big users (Japan, South Korea and Taiwan) to develop alternative energy sources. But if we compare this to the EIA’s business as usual projections for 2015, we have actually reduced global steaming coal exports from the projected 764million tons to just 623tons, because the vastly expanded exports of other countries have been used to fill the void left by Australian coal exports rather than add to a massive Australian expansion.

So in fact we have saved 141million tons of steaming coal from being burnt in 2015 compared to BAU projection, and in doing so prevented 380million tons of carbon dioxide being released.

Full of shit
So next time the Australian Coal Association tells you that a phasing out of Australian coal exports would produce “no reduction in global emissions” because “coal mines overseas will immediately produce more to fill the gap” just remember they are completely full of shit. It would take at least a decade, and probably longer, to fill the void left by a phasing out of Australian coal exports, and this would more than likely occur against a backdrop of the arctic melting each northern summer.

Are the people of Colombia and South Africa known for their political apathy? Would scores of new mines in each of those countries be easy to roll out? Do the governments of those countries have plenty of cash lying around to build new coal infrastructure? Or would the same multinationals behind the ‘cut emissions- not jobs’ campaign in Australia- like BHP Billiton, Rio Tinto, Xstrata, and Peabody- have to fund the south African and Colombian coal rush themselves?

Australia is the Saudi Arabia of coal exports.

A phasing out of our steaming coal exports, which would require the provision of quality alternative jobs for coal workers, and the creation of alternative industries to ensure coal communities can prosper without coal, would have a massive impact on the whole global climate debate.

And the Australian Coal Association- a mouthpiece of multinational coal companies- knows it.

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Zane Alcorn is a member of the organising collective of the Just Transition Tour, which is touring NSW coal communities via Canberra, Katoomba and Sydney from November 20—26. For updates and info visit transitiontour.wordpress.com

Refs:

Cfmeu press release- quote from worker
http://www.cfmeu.com.au/index.cfm?section=5&Category=42&viewmode=content&contentid=498

Aus coal exports-
http://www.australiancoal.com.au/the-australian-coal-industry_coal-exports.aspx

Rudd ‘step up to the plate’ quote
http://www.abc.net.au/news/stories/2009/11/18/2746583.htm?section=australia

Indonesia coal exports
http://in.reuters.com/article/oilRpt/idINJAK13450320091014

Energy Information Agency (EIA) world coal outlook 09 (main resource used for article):
http://www.eia.doe.gov/oiaf/ieo/coal.html