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• Sydney stewing in its own pollution. This shot was taken from Arncliffe, 10 km south of the city's centre on the afternoon of 8 June 2005.

Dirty power is also poor investment in jobs and the economy

10 June 2005

A recent suggestion that the NSW state government’s energy white paper would grant Delta Electricity the right to plan for 1,500 MW of new coal power was condemned by the environment movement. And so it should have been, given that this plant will increase greenhouse gas emissions from NSW’s electricity industry by about 18 per cent. Australia-wide, electricity generation contributes about 33 per cent of our nation’s total annual emissions.

Additional coal-fired power generation in the Hunter Valley or elsewhere would be bad news for employment, jobs and the climate. If the same amount of money were wisely invested in clean energy, more jobs would be generated, lower-cost long-term outcomes would be achieved and Australia’s balance of trade could be significantly improved.

A power station built this decade will last well into the 2050s, and will be a major source of climate damaging pollution throughout that time, so a coal-fired generation is the wrong way to go if we're serious about avoiding massive climate chaos, including prolonged droughts, ferocious storms and widespread famines and epidemics.

Alternatives that generate much less pollution exist and are cost-effective. Wind generation, solar water heating, burning crop residues and improved efficiency of electricity use are all available technologies and are cost-effective substitutes for the current proposal.

It isn’t only environmentalists who should be raising the alarm on the Carr Government’s proposal. The new coal power plant would cost about $2 billion. If this money were invested in those cleaner sources of power, far more jobs would be generated. Studies show that per unit of energy generated, wind farms create about four times more jobs than coal-fired plant.

It’s also surprising that the economists who criticised our imbalance of trade and current account deficits in the 1980s aren’t sounding the alarm. Of the approximately $2 billion that it would cost to build a 1,500 MW coal-fired plant, about $1.5 billion will be spent overseas. On the other hand, wind generation and energy efficacy technologies could mostly be manufactured in Australia. Spending $2 billion on clean generation with 80 per cent Australian manufactured content – as we could achieve with wind generation – would see $1.6 billion spent here and only $400 million spent offshore. This would surely be good news for a country with a mounting current account deficit.

Another worrying aspect of the white paper proposal is the idea that the new coal-fired generator could be privately owned. This might be better for the short-term finances of the state, but it is bad news if at some future time a government, in response to community and international pressure, wants a substantial change of direction for its energy industry. Private ownership would, along with a number of other problematic features, make such a change much more difficult.

NSW urgently needs a debate about its energy future. If deregulation and competition are delivering extremely poor outcomes for the environment, jobs, and the national economy, then it’s time we revisited the way we plan our electricity industry.

• Dr John Kaye teaches and researches electrical engineering at the University of New South Wales. He was The Greens Senate candidate in the 2004 federal election and specialises in public policy issues surrounding public infrastructures and the environment.
Phone: 0407 195 455
Email: J.Kaye@unsw.edu.au