The Queensland Budget: Coal versus Climate Change

The release of the Queensland budget yesterday provides an important insight to the government's credibility on the climate change - particularly when you compare their investments in renewable energy and climate adaptation against their continuing subsidisation of the coal industry.

We've done a bit of a comparison, and the figures stack up this way: even on a conservative account,subsidies to the coal industry in the budget is 23 times greater than the TOTAL climate change initiatives (including renewable projects, adaptation, energy efficiencies and disaster preparation).

Climate Change Investments

There are a number of initiatives and new spending outlined in the Treasurer's speech, the budget highlights and the various budget papers. The total array of climate change spending, including investments in renewable energy, adaptation and mitigation, announced yesterday were emphasised by the Treasurer as part of the integrated program: 

to assist in meeting the other great challenge of our time—moving to a low carbon economy... [including ]a range of initiatives that will form part of our future agenda on dealing with, and adapting to, the reality of climate change.

So, what is the extent of the Government's real commitment to "the great challenge of our time"? 

Let's look at the detail. The initiatives announced were: 

• $15 million over five years in the Geothermal Centre of Excellence
• $4.3 million to Ergon Energy for a new geothermal power station
• $7 million towards the development of a 10MW solar thermal power station at Cloncurry
• $47.7 million to ENERGEX and Ergon Energy to initiate a range of demand management and energy conservation measures in Queensland
• $9 million to Mackay Sugar Co-operative Association Ltd for the Mackay Sugar Cogeneration Project
  $7.5 million to the Commonwealth Scientific and Industrial Research Organisation for SolarGas One
• $5 million for the Coastal Geothermal Energy Initiative
• $5 million for Ergon Energy to trial an energy conservation program in Queensland's isolated communities
• $15 million over four years for the Climate Smart Business Service
• $8 million over 4 years for energy efficiency in government buildings
• $7.7 million over 5 years for disaster preparedness in vulnerable communities
• $3.4 million for disaster management equipment over 3 years

On first glance, this looks like a committed investment of $134.6 million in climate change initiatives. But  taking into consideration the time frames and funding commitments for these initiatives changes the story somewhat:

• Of the $25.8 million promised from the renewable energy fund, only $10.3 million will be allocated in 2009-10.
• The ClimateSmart Business Service, the energy efficiency for government buildings program and the disaster management equipment purchases each have a zero budget allocation in 2009-10.

Taking these figures into consideration, that's a sum total of $74.32 million in funding for all of the Queensland Government's climate change initiatives for 2009-10.

Coal Subsidies

By way of comparison, let's look at the funding commitment for 2009-10 made to the coal industry in the form of subsidies. Yesterday's budget pledges: 

• $862 million on a range of purchases and upgrades to support the haulage of coal in Central Queensland
• $148.5 million for new and upgraded coal rollingstock, including additional electric and diesel locomotives and coal wagons
• $17 million will be spent to finalize the X25 expansion of the Abbot Point Coal Terminal to increase the capacity of the terminal to 25 million tonnes per annum.
• A further $287.9 million is provided for the Abbot Point X50 Expansion, which will increase capacity to 50 million tonnes per annum
• A further $23.5 million for refurbishment of stacker-reclaimers 1 and 2 in relation to the
  Abbot Point Coal Terminal Expansion project.
• $38.2 million of ongoing works at the RG Tanna Coal Terminal
• $27.4 million for general works around the Port of Gladstone (whether you see this as a coal subsidy is a question for debate, admittedly) 

Do the maths. That’s $1.404 billion on coal infrastructure subsidies for this financial year alone. 

You can add to that a further $19 million allocated from the $300 million from the Clean Coal Technology Fund. But that's only looking at the production side of the greenhouse equation. What about the continuing investment in our coal-fired powered stations?

Coal Power Generation

The budget commits: 

• $56.8 million on improvements to the Callide power station, including overhauls and major refurbishment work on the B station mid-life refit
• $39.6 million and $54 million respectively on improvements to the Swanbank and Kogan power stations
• $61.6 million on comprehensive maintenance works and plant upgrades of Stanwell, Barron Gorge and Kareeya power stations
• $123.2 million on maintenance and improvements at the Wivenhoe, Tarong and Tarong North power stations.

So that's $335.2 million in maintaining our existing dependence on coal fired power, compared with $10.3 million in developing new and renewable energy sources. 

Check Our Maths... Please!

If you have time to go through the Budget papers (available here), please check our maths on this. Is there anything we've not included? Have we underestimated the government's supposed commitment to climate change? Are we over-exaggerating the subsidies that are going to the coal industry? 

We certainly hope so.

Because the way we figure it, the balance sheet looks like this: $74 million for climate change versus $1,758 million for coal. Even on a conservative account,subsidies to the coal industry in the budget is more than 23 times greater than the TOTAL climate change initiatives (including renewable projects, adaptation, energy efficiencies and disaster preparation).

After all, this is from a government that purports to be concerned this issue. Imagine if the Queensland government wasn't committed to action on climate change...