ABC NSW – COUNTRY HOUR
WEDNESDAY, 19 AUGUST 2015
SUBJECT/S: Australian coal mining, Renewables
MICHAEL CONDON: The coal industry is facing structural decline. Joel Fitzgibbon, the Opposition Spokesmen on Agriculture and Rural Affairs, says the industry will probably reduce in size but will still be a significant player. This follows yesterday’s view that big overseas coal companies are losing interest in Australian mines and the industry is in turmoil, that was according to independent energy analysis Tim Buckley. But Joel Fitzgibbon says he doesn’t subscribe to the view that the outlook for coal is bleak.
JOEL FITZGIBBON, SHADOW MINISTER FOR AGRICULTURE, SHADOW MINISTER FOR RURAL AFFAIRS: Well I think people basically fall into one of three categories. Those who want coal gone; those who believe it will disappear based on market conditions; and those who believe it will continue to be part of the Australian economy, and indeed the global economy, albeit at a smaller market share of the total energy consumption. And I fall into that third category. I believe that coal will continue to play a significant role in our economy and the international economy well into the future and I think that’s a view shared by the International Energy Agency.
CONDON: But if Tim Buckley is right, 98 per cent drop in the value of Peabody a lot of sellers, no buyers for Australian coal mines and the Chinese and the Indians turning their back on exported coal, that must be sounding alarm bells for you?
FITZGIBBON: Well, the Chinese aren’t turning their backs, certainly they want a much greater proportion of their energy consumption to come from renewable sources and that’s an objective of great merit and its one the Labor Party in Australia believes in, its one the US believes in and most developed countries around the world. So coal will come under pressure but coal remains a relatively cheap commodity and there are still a lot of people around the world desperate for cheaper energy sources. I mean in India alone as we talk, there are about 300 million people still without energy, without light, without power to heat their homes etc so coal will continue to play a big role in filling that need. In my own Hunter Valley obviously we are under pressure because the price of coal has significantly collapsed, but this year we will ship record volume of coal out through the Port of Newcastle. So yes, he is right to say that the market is putting pressure on the sector and indeed people’s consumer decisions about where they want their power to come from is putting pressure on the market but the sector has enormous sunk costs in places like the Hunter Valley and I have no doubt they’ll continue to ship coal out of the Port of Newcastle for many many years to come.
CONDON: So you think it’s a question where they can actually make a profit at a lower level or maybe slightly higher then where it is now?
FITZGIBBON: Well, mining is a very capital incentive business that’s also true in my area of the Hunter Valley. It does at the end of the day have to be effective in that it returns a profit for its shareholders and given ongoing demand, the Energy Agency numbers and high demand in Asia in particular ongoing I do believe the coal mining industry in Australia has a long term future.
CONDON: What about the argument that we should be moving away from the old technologies and embracing newer renewable technology, renewable sources of energy and Tim Buckley saying we’re just not doing enough of that even the Chinese and the Indians are doing more then what we are?
FITZGIBBON: Well, Tony Abbott certainly isn’t doing enough. He has had his head in the sand, he is living in the past, he’s always looking back - never forward. The Labor Party in Australia by contrast, has a very very solid commitment to the renewable sector. You see energy consumption will continue to rise over time and therefore coal’s proportion of energy consumption will continue to climb but at the same time its volumes might continue to grow, it just depends on what consumption looks like in the future. But yes, the former Labor Government was partnering with the rest of the world in incentivising a shift to the renewable sector. Unfortunately Tony Abbott in Government has unravelled that process.
CONDON: But even a number of critics were saying even that move wasn’t enough and that the reliance on coal was still too strong in the Labor Party.
FITZGIBBON: Well, I think we’ll only achieve our objectives working with the international communities. Australia is a relatively small country by population and acting alone is too big a challenge we need to do it in concert with others, as you’ve pointed out. All of the developed nations, indeed most of the emerging nations like India and China are acting, the only person who appears unwilling to act is Tony Abbott and that is damaging Australia’s reputation.
CONDON: Looking at the polls, the Labor Party is, well there is an 8 per cent difference in favour of Labor at the moment. If Labor was to form Government at the next election, how would you address the issue of mining versus farming in regional issues? I mean that would be part of your portfolio should you become a minister I would imagine, so how would you sort of bridge that gap that’s there between miners and farmers that at the moment seems fractured?
FITZGIBBON: By next March I’ll have been the Member for Hunter for 20 years and by definition I’ve been dealing with land use conflicts for all of that time. I represent an area which is both strong on coal and power generation but also still has very proudly a very strong agricultural sector, viticulture, thoroughbred breeding are also very very prominent in my region so I know this question very very well. The only way to deal with it is to make sure that the approvals’ processes for extractive industries are based on evidence and on science. Now that’s why when we were last in Government we established an Independent Scientific Committee in Canberra to deal with matters under the EPBC Act and of course ensure that not only flora and fauna questions came to Canberra but also questions around water. We will do well in dealing with these competing issues if we stick to the science and of course that’s something Tony Abbott seems determined to depart from also.
CONDON: But didn’t the whole approvals process come under the stoplight when Ian McDonald was Minister and Eddie Obeid was involved in the corridors of power in the ALP in NSW State Government.
FITZGIBBON: Well, I think the allegation there is that we didn’t rely entirely on the science, so if we stick to the facts in these matters and let the independent experts provide the advice and properly consider that advice then we can’t go wrong.
CONDON: Joel Fitzgibbon who’s the Member for the Hunter you’re listening to the Country Hour, it’s nineteen minutes past twelve.