Australia Funds Coal Development While Export Market Sags
Australia’s pro-coal government is misleading itself and its taxpayers with an economic study that projects far more demand for the declining fossil fuel than is ever likely to materialize.
The report from the Office of the Chief Economist “seem stuck in 2014,” and “is coloured more by industry hope than market reality,” the Institute for Energy Economics and Financial Analysis argued in a blog post last week. “It concludes, quite erroneously, that India will not just continue to rely on coal imports, but will increase them.”
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The International Energy Agency data cited in the Australian report dates back before the May, 2014 election of Indian Prime Minister Narendra Modi, “an event that reset Indian energy policy,” IEEFA notes. “Since Modi’s ascension, and under the direction of Energy Minister Piyush Goyal, India has gone on an energy-policy tear, announcing initiatives almost daily aimed at transforming the Indian coal industry and its power generation, grid distribution, and utilities sectors.”
In November, Goyal announced plans to end thermal coal imports in two to three years.
The errors and omissions matter, since “the purported growth in India’s appetite for foreign coal is why the Abbott government is using taxpayer dollars to fund foreign billionaire investments in high-risk new coal ventures in Australia,” writes Buckley, the Institute’s director of energy finance studies, Australasia. The report “says nothing of the associated new mine and rail-port infrastructure in Australia that will be at risk of being a stranded asset.”