East Gippsland is not the next Pilbara

Martin Ferguson just loves brown coal. Would have it with lunch, if he could. Thinks we’ll be shipping it out of the Latrobe Valley by the megatonne. The current Victorian government is equally excited about the idea, as was the previous one. But don’t worry about those pesky greenhouse emissions, because it’ll be green, too!. New technology will mean that emissions from brown coal will be “less than 0.2 tonnes of CO2 per megawatt-hour”, or less than half that of modern gas-fired baseload plants, according to the Brown Coal Innovation Network.

Wonderful. Great aspiration – and I support money being invested in CO2 capture and storage. Even if it arrives too late to clean up coal, we’ve still got to do something about steelmaking, and most likely we’ll have to do some air capture of CO2 in the long term future to get us back to a safe climae.

But let’s look at reality for a moment, and particularly as it applies to brown coal. Victoria’s brown coal has precisely one virtue as a fuel – it’s available in abundance in Victoria. It’s also virtually free – for a very good reason. Nobody else would want to buy it, because it’s too dangerous to ship anywhere.

The “new technology” proposed to export Victoria’s brown coal – “the next Pilbara”, though the next Newcastle might be a more accurate description – is essentially to heat-dry it. Once that’s done, it’s proposed to use coal gasification technology in new power stations, possibly combined with carbon capture and storage, to generate electricity with much-reduced greenhouse impacts.

However, there’s two issues here. Firstly, even in the current market where developing country customers are not particularly concerned about greenhouse impacts, why the hell would you buy Victorian brown coal when there’s plenty of black coal on the market, and plenty more sitting in the ground waiting for mining in Queensland and Indonesia – both closer to those markets?

And as for brown coal gasification, let’s just note that despite large piles of government money, HRL has just suspended its plans to build one of the things here, due to a VCAT decision that makes approval for the plant contingent on the federal government signing contracts to shutter some of the state’s older brown coal plants.

For what it’s worth, I’m not convinced that the policy outcome of the tribunal decision is optimal here, but the fact is foreign customers aren’t going to invest in unproven brown coal shipping and gasification technology when it can’t even be shown working on a commercial scale in its home state – particularly as there’s likely to be a glut of very cheap natural gas coming on the market in the next couple of years when the United States becomes a net natural gas exporter.

You should never say never, but I find it very, very, very hard to see how brown coal will ever be a viable export commodity even ignoring the moral dimensions. The Victorian government, however much it pines for mining royalties like Queensland and WA, needs to get over the delusion that brown coal is going to become a tradeable commodity in any relevant timescale.

Advertisements
This entry was posted in Economics, politics, Science and tagged , , , , , . Bookmark the permalink.

5 Responses to East Gippsland is not the next Pilbara

  1. Foreign buyers might take treated brown coal if it were cheaper than alternatives. I have no idea whether that is likely or not. A couple of other points however:
    Firstly – The industry states that it expects the greenhouse gas burden of this squeaky ‘clean’ new fossil fuel to be “less than 0.2 tonnes of CO2 per megawatt-hour”. Those emissions are regarded as belonging to the country where the stuff is burned. Well perhaps they can achieve these emission levels at point of combustion (Talk is cheap and I’ll believe that when I see it) However it’s noticeable that no-one talks about the emissions that would accrue here in Australia as a result of the energy intensive processes needed to create this ‘clean coal’. In other words what are the life cycle emissions of this fuel. As with all the unconventional gas ‘products’ the snake oil salesmen are peddling, consideration of the life cycle emissions reveals that gas is most definitely not a clean fuel. For more on this you might like to look here http://duggyvans.blogspot.com.au/p/gas-combustion-is-not-clean-energy.html
    I bet that when total emissions are considered we will find that doctored brown coal is not ‘clean’ at all.
    Secondly – drying the lignite to produce this you beaut new product results in very large volumes of irremediably polluted water. Dealing with that would be an Australian problem – the Gippsland Lakes as an industrial waste storage?

    I think this Crikey post said it pretty well at the time. http://blogs.crikey.com.au/rooted/2011/09/06/is-brown-coal-really-the-planets-saviour/

  2. Good post. The technology that’s required seems a long way away, and given that Vic has 9% of the world brown coal I can’t see there being a particularly strong global effort to develop the required technology.

    CCS is quite vexing. As with so many energy policy issues, proponents and detractors seems to speak at cross purposes. Most mainstream emission reduction projections rely on CCS coming online, but the failure to commercialse when there’s so much at stake makes you wonder. Coal interests seem to be making a very minimal contribution to the technology’s development, a sign I think of their lack of confidence in it ever being viable.

    I can’t help but think this is all about the politics and proving that Baillieu would love a coal future. The reality of making it happen barely rates a mention.

  3. wilful says:

    (The La Trobe Valley is not East Gippsland, which starts at Bairnsdale).

    This is pure horse-shit this idea. I don’t know how any sensible people in DPI can believe that this is more than a mere fancy. I can only suspect that some dumb Ministerial adviser has had a boozy lunch with a brown coal booster (do these people really exist?) and come back and tol;d the department that this is going to happen.

Comments are closed.