New expert analysis has uncovered a perverse outcome of the Albanese Government’s Safeguard Mechanism Reforms which will allow ten large coal mines to increase their emissions. Report available here.
The mines could also potentially generate windfall credits for themselves under the scheme without taking any action to reduce emissions, meaning the mining companies could be paid to pollute.
The Energy Resource Insights briefing, released today and commissioned by Lock the Gate Alliance, finds that the anomaly arises from the Safeguard Mechanism’s application of industry averages to determine facility-level emissions baselines.
That means while underground mines which tend to produce more direct greenhouse emissions per tonne of coal produced will face appropriate limits under the mechanism, ten open cut coal mines will be able to increase their emissions, and could reap a financial benefit in the form of Safeguard Mechanism Credits at a potential value of $180 million dollars even if they take no action at all to reduce their emissions. See below for a list of the ten projects.
The ten large mines represent around 30 percent of Australia’s coal production and six of the ten set to benefit from the policy have proposals to expand.
Lock the Gate Alliance research coordinator Georgina Woods said, “It would be absolutely perverse if the design of the Safeguard Mechanism created an incentive to expand open cut coal mining and release more dangerous methane into the atmosphere just as humanity is on the cusp of catastrophic levels of warming.
“There’s still time* for Climate Change Minister Chris Bowen to fix this problem. The credibility of the Safeguard reforms will be in doubt if huge open cut coal mines, most of which have plans to expand, are able to increase emissions and make money from the scheme.
“Crucially, the greenhouse gas these mines will emit, methane, is responsible for around a third of the warming the world has suffered so far, and urgently reducing these emissions will buy us extra time to prevent catastrophic warming beyond the Paris Agreement goals.
“Devastating bushfires, droughts, and floods are wreaking havoc on communities, particularly in the regions. Now is not the time for governments to enable huge coal mines to make money from increasing emissions when the rest of the economy is working to reduce emissions.”
ENDS
*Background: While Safeguard Mechanism reforms came into force on July 1, there are still pieces of regulation being made, including the role and level of industry average emissions for coal mining.
Table 1: Coal mines with emissions baselines that will rise to 2030 under the Safeguard calculation
|
Facility |
State |
Mine type |
Coal mined 2022 (ROM tonnes) |
Reported emissions 2022 (tonnes CO2e) |
Change in baseline (FY24–FY30) |
Potential credits |
Expanding |
|
Moolarben Coal Mine |
NSW |
Mixed |
19,523,032 |
181,893 |
+131.3% |
1,327,695 |
Yes |
|
Wilpinjong Coal Mine |
NSW |
Open Cut |
13,517,830 |
154,554 |
+119.4% |
894,449 |
|
|
Mangoola coal mine |
NSW |
Open Cut |
7,656,694 |
100,044 |
+110.6% |
494,949 |
Yes |
|
Rolleston Coal Mine |
Qld |
Open Cut |
13,016,972 |
160,537 |
+68.5% |
710,157 |
Yes |
|
Ravensworth Operations |
NSW |
Open Cut |
12,756,449 |
268,698 |
+32.2% |
492,986 |
|
|
Callide mine |
Qld |
Open Cut |
6,904,985 |
188,124 |
+29.0% |
252,998 |
|
|
Mt Owen Glendell Complex |
NSW |
Open Cut |
11,497,827 |
264,736 |
+27.6% |
410,759 |
|
|
Boggabri Coal mine |
NSW |
Open Cut |
7,430,036 |
177,437 |
+21.6% |
233,478 |
Yes |
|
Mount Arthur coal mine |
NSW |
Open Cut |
19,059,688 |
503,403 |
+18.5% |
552,085 |
Yes |
|
Peak Downs Mine |
Qld |
Open Cut |
18,543,975 |
448,708 |
+9.5% |
381,747 |
Yes |