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By HARRY CLARKE
SCATHING criticism of coal royalty hikes and serious doubts about the Queensland Government’s $62 billion dollar energy plan arose at a major resource industry conference that was snubbed by the Premier and all of her ministers.
An 800-strong crowd at the Queensland Resources Council’s (QRC) annual conference also heard one expert’s prediction that renewable hydrogen wouldn’t become a commercially viable commodity in the foreseeable future, while Japan’s Ambassador to Australia also warned his country’s investment in the technology would be at risk if distrust in the State Government began to emerge.
Interest in the event at Brisbane’s Convention & Exhibition Centre elevated when Premier Annastacia Palaszczuk sensationally declared she and government ministers wouldn’t be attending because she was “extremely disappointed in (QRC chief executive) Ian Macfarlane and his attacks on the government”.
Palaszczuk was referring to the QRC’s launch of an advertising campaign, reportedly costing the organisation $40 million, urging the government to reconsider coal royalty increases announced in this year’s state budget.
“I was invited to today’s lunch. I have made it very clear that my ministers will not be attending this lunch because of the campaign – the $40m campaign,” Ms Palaszczuk said.
“I am angry about this. I could put money into housing with $40 million. I can put $40 million to very, very good use – towards another satellite hospital.
“If companies are making $40 million to go into a campaign, that money can be very well spent in the lead up to Christmas helping Queenslanders.”
Macfarlance said the QRC had “the right to stand up and tell the facts about the resources sector” as the lobby group’s annual economic update claimed the industry contributed $94.6 billion to the state’s economy, employed 450,807 people and supported 14,303 businesses.
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“This is what’s at stake when poor policies or increased taxes threaten our sector,” Macfarlane said.
“You would think these figures alone would get us a meeting with Queensland Treasurer Cameron Dick to talk about his plan being devised behind closed doors to hit up our industry with an astronomical increase in coal royalty taxes.
“But no. Instead, there was no consultation, no negotiation, and no opportunity to provide feedback on how such an enormous increase in royalty taxes would impact our industry’s future.”
“They’ve not only pulled the plug on the lunch, but earlier this year they pulled the rug out from under the resources sector by introducing the world’s highest royalty tax, by a long way.”
The keynote speech at the QRC’s conference was delivered by Ambassador of Japan to Australia, His Excellency Yamagami Shingo, who said Japan’s future investment in Queensland’s emerging renewable hydrogen industry depended on trust that the state would be a reliable place to do business.
He said a Memorandum of Understanding on critical minerals cooperation, which was recently signed between Japan and the Federal Government, reiterated Australia’s promise to remain a strong resources trading partner.
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He said trade relationships between the two countries was worth $90 billion, of which $20.7 billion related coal and 11.3 billion to iron ore.
“Nowhere are Japan and Australia investment ties more apparent than right here in Australia’s Sunshine State,” Yamagami Shingo said.
“Japanese companies’ eagerness to collaborate with their Australian counterparts in resources is underpinned by trust in Australia as a safe and reliable place to invest.”
“This is why … the Queensland Government coal royalty hikes carry so much potential risk,” he said.
“It could have implications beyond Queensland or the coal industry, affecting Japanese investment in joint ventures such as hydrogen.
“Japanese investment and trade in Australian gas is a cornerstone of our partnership based on trust. That is why we are following with great interest the discussion within Australia regarding energy, including gas and coal.
“Japan has been reassured repeatedly by the Australian Government that Australia will remain a trusted and reliable supplier of resources and a safe place to invest.
“I strongly believe if we work together, and play our cards right, the Land of the Rising Sun and Australia’s Sunshine State can share a bright future together.”
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Skepticism about energy plan and hydrogen
Speaking during a panel discussion at the QRC event, where the topic was “Future Investment in Queensland”, Bowen Coking Coal executive chairman Nick Jorss said he was a “bullish” on the future of Queensland’s coal industry.
Jorss, who is also a substantial shareholder of Stanmore Coal, said he believed emerging technologies, particularly hydrogen, wouldn’t become a dominant source of energy, globally, in the foreseeable future.
“It’s not going to happen in my lifetime in a cost competitive way,” he said.
“Hydrogen is the opposite to cheap gas – it’s extremely expensive gas and it’s difficult. People talk about the price of green hydrogen as 5 to 8 dollars US. It’s got to be down below 2 and that doesn’t include transport.
“They’re talking about a theoretical price if you take free renewables, you have your electrolysers running 24-7, you get them cheaply out of China. That’s the best case scenario.
“People say it will (become viable) track down but I’m not convinced on that.
“When you look at what’s actually happening in Europe – places like Hamburg, whey they do produce minuscule amounts of this stuff and trade it on the market – it’s 14 euros a kilogram.”
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He said aspirations by the sector to eventually produce 20 million tonnes of green hydrogen per year were unrealistic, given that 400 gigawatts of additional solar and wind electricity, and nine litres of water, would be required for every kilogram of hydrogen produced.
“These things are just not going to happen. The physics aren’t going to cut it and at some point people will realise it,” Jorss said.
Another panelist, Commodity Insights founder and director Mark Gresswell, said he predicted the $62 billion price tag on the Queensland Government’s recently announced Energy and Jobs Plan would blow out significantly to the point of being unviable.
“I’d actually call it somewhat utopian,” Gresswell said.
“Most people here would have heard of the energy triangle – cheap energy, reliable energy, low carbon emission energy. It’s accepted knowledge that you can have a system with two of the three, but not all of the three.
“But, miraculously, this plan is going to do all three. I tried to find a business case for it – I couldn’t.
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“There are some items in there that are quite problematic. The government’s going to spent $62 billion of your money. Thats an average cost per household of $28,000, and at the same time they’re going to reduce our energy bills. It doesn’t quite add up.
“We’ve talked about high energy costs, we’re seeing high inflation come through the system. In my view that’s not going away until we solve the energy inflation problem.
“High energy costs feed into the costs of solar panels and the cost of wind turbines, so you can bet that that $62 billion dollars that the government quoted is going to be closer to 70, 80, probably 100 by the time they actually implement it.
“I’m a realist and I just think there’s problems with the cost of these things and who’s going to paying for it in a high inflation, high inflation environment.”