“Australia should move completely away from coal-generated electricity,” Senate report said in economic factors as the primary factors.
The report called for a comprehensive energy plan that would ensure coal-fired power stations close with plenty of warning.
The committee’s chairwoman, Larissa Waters, said: “This report should be a wake-up call for the government. The electricity market is going through a dramatic transformation and should be managed.
“The requirement to plan the transition was driven mostly by economic and energy security factors,” the report said. Since a disorderly closure could wreak havoc on energy supply and communities that rely on jobs in coal-related industries.
The closure of most power plants in the coming decades was inevitable. With most of Australia’s fleet already more than 30 years old, several large coal power stations have been slated for closure.
A Tough Choice Australia Has To Make
While Australia is likely to meet its 2020 target, it’s not on track to achieve its 2030 target, which aims to reduce 2005 emissions by 26-28 percent.
The report noted that Australia was one of the countries likely to need further action in order the meet the 2030 target.
The transition away from coal has been controversial, which federal government support for the jobs it is expected to bring.
The ACF is also concerned that Australia’s export credit agency Export Finance Insurance Corporation may guarantee loans for the mine. This could make taxpayers money used to pay foreign banks if the mine failed.
But the UN report says subsidies for coal should be phased out to encourage a faster transition away from the resource.
Even Pacific Islanders are now calling on Australia not to fund Adani’s mine.
“We didn’t think of Australia as a country that would do that. We looked at it as our bigger brother. Proceeding with that new mine is a sad move. We live together in the environment, but it’s like they are ignoring us.”
During the public hearings, Erwin Jackson from the Climate Institute said that since existing coal power stations were going to close no matter what, energy prices were inevitably going to rise.
And Frank Jotzo from the Australian National University said the cost of building renewables and coal power stations was about the same, so there was no commercial reason to preference coal.
“I would judge it highly unlikely you would see commercial investment in coal-fired power in Australia,” he said.
Who is Building New Coal Power Stations?
The United Nations said phasing out coal consumption in the power sector would be necessary to meet international targets.
Yet coal-fired power stations continue to be built around the world.
In early 2017, an extra 273 GW of coal-fired capacity was that moving, and 570 GW was in pre-construction.
The new projects are mainly focused in 10 countries, which are building about 85 percent of the extra capacity. They include China, India, Turkey, Indonesia, Vietnam, Japan, Egypt, Bangladesh, Pakistan and the Republic of Korea.
But it’s not all bad news. China and India have both shelved or canceled new projects in 2016 that will see a reduction in extra capacity of 54 percent and 52 percent respectively, compared to 2015.
Contributor to the UN report, Professor Frank Jotzo of the Australian National University’s Crawford School said, building small to medium scale solar in India was now cheaper in many cases than making large-scale coal.
“If they all run to the end of their life, then this will be completely incompatible with climate conditions. They won’t be running to the end of their lives, and not all the plants will be built,” he said.
Can we Change?
Phasing out coal will improve air quality and increase water availability. But the report acknowledged that moving away from coal can be politically tricky.
It noted that governments which tried to get rid of subsidies without taking into account the political impacts have often failed.
“We shouldn’t pretend this is not a challenge,” Prof Jotzo said. “But we have gone through previous shifts, including the turn away from the clothing and footwear industry. Also the shift away from the car industry in Australia.
“It’s always the case in Australia that other jobs, other investments, take the place of the old.”
When everyone from the Greens to Australia’s most prominent coal-fired power company is calling for a national plan to phase out coal-fired power stations, communities and clean energy investors can plan for the future, it is time for the government to get on board.