NSWMC say Gov. has carbon tax figures wrong

The NSW Minerals Council say the Government has the carbon tax figures wrong when it comes to coal mines.

“While it is convenient for the Federal Government to quote average figures, there is no such thing as an average mine,” NSWMC chief executive Nikki Williams said.

This comes after climate change minister Greg Combet said the carbon tax will not destroy the mining industry.

“Treasury modelling shows the Australian coal sector more than doubling its output by 2050 with a carbon price in place,” he said.

“With a $23 a tonne carbon price, once the Government’s assistance is taken into account, the impact on costs for the coal mining industry will be less than $2 for every tonne of coal produced, on average across the industry.

“This cost impact of less than $2 a tonne of coal should be compared to selling prices of more than $300 a tonne for metallurgical coal and around $120 a tonne for thermal coal.”

Williams hit back, stating “you simply cannot average out the impact of the carbon tax”.

She explained that similar to the gases of flatulent livestock such as cows and sheep, fugitive emissions from coal mines are difficult to both measure and stop.

Additionally, “claims that the carbon tax will cost less than $2 per tonne of coal (after the Government’s assistance package) are wrong. The carbon tax effects will be hugely differentiated: up to 25 times higher for some mines – that’s why it’s meaningless to use averages”.

When Combet refuted the industry’s original claim that it would cost jobs, he said the mining sector used survey, compiled by ACIL Tasman, which was based on incorrect data.

He said that the survey worked off the assumption of a carbon price of $55 a tonne in 2020, contrasting modelling by the government of a $29 per tonne price for 2020.

On top of this, the ACIL Tasman survey did not take into account the $1.3 billion in assistance to provide support jobs under the Coal Sector Jobs Package.

Combet added that the recent billion dollar bid for Macarthur Coal by Peabody Energy is proof that the tax is not harming investment.

However, Williams stated that it used actual data from 82 operating coal mines, and that ACIL Tasman found that 18 of these mines will be unprofitable under the carbon tax and face closure.

“Some Australian coal assets have been effectively de-valued by the carbon tax.

She also hit out at the Macarthur acquisition statement, saying “the potential chance of ownership of Macarthur Coal is proof of nothing except that some mines will continue operating under the carbon tax”.

“The offer made for the company was less than the pre-carbon tax offer. Analysts have also downgraded the value of an Illawarra coal company by almost half.

“More than 98% of mining company earnings have either been reinvested in Australia or paid to our governments in taxes and royalties” which is a figure the Government is not taking into account, she said.

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