Turnbull wants to subsidise coal AND gas transport

Turnbull wants to subsidise coal AND gas transport

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PM suggests public money could be used to subsidise gas pipelines in northern Australia, as well as underwriting rail plans of Indian coal giant Adani.

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Prime minister Malcolm Turnbull has again declared his support for all things fossil fuel, after suggesting his government could use public money to sponsor both new coal and gas production facilities in Australia, via the Northern Australia Infrastructure Fund.

In his latest concession to the nation’s powerful fossil fuel lobby, Turnbull told Brisbane Radio that the fund could be used both to subsidise gas pipelines in northern Australia and to underwrite the plans of Indian coal giant Adani to build a rail line from its proposed Carmichael mine.

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Turnbull was speaking with ABC Brisbane on Thursday on the subject of his government’s plans to restrict the export of natural gas, in recognition that the massive and poorly regulated expansion of this market has had the effect of pushing up power prices in Australia.

But before Australian gas majors even had time to wince, Turnbull added that the Coalition was also considering backing the construction of a Northern Territory gas pipeline, and several pipelines in Queensland, to ease gas shortages, and lower prices.

“We are looking at a number of proposals, including one to bring gas from the Northern Territory into the east coast system, but more gas pipeline infrastructure in Queensland would be very welcome,” he said.

And when asked if Naif support for gas pipelines would rule out using the fund for a $900m concessional loan to Adani, Turnbull replied there was “no reason you can’t do all of the above”.

“This type of pipeline infrastructure is critically important,” he said. “So if the Queensland government or anyone else has got a proposal for pipeline infrastructure in northern Australia, then they should be getting their plans into the infrastructure fund as soon as they can.”

The comments come as the Murdoch media resumes its campaign to blame renewable energy, and not gas, for the nation’s rising electricity prices.

On Wednesday, Sydney’s Daily Telegraph reported that NSW households would be “whacked with power bill increases of up to $400 a year … driven by the shift from coal to renewable energy.”

There was no mention of gas in the article, despite the fact that it is now well accepted, even by the people who run the grid, that the state of Australia’s run-away gas market is the main culprit behind inflated power prices.

Likewise, Turnbull doesn’t seem to have got the memo, which is particularly confounding considering the findings of last week’s Climate Council report, which concluded that putting more gas into the electricity market would not lower electricity prices, but further sting consumers.

As the Climate Council report explained it, Australia’s LNG exports are pushing up the price of gas power at the expense of Australian households and business because domestic gas prices are now inextricably linked to world market prices for oil – a link is says will continue for the foreseeable future.

Climate Councillor and former President of BP Australasia Greg Bourne said the report’s clear message was, to leave the majority of Australia’s gas reserves in the ground.

“Don’t believe the hype. Any perceived climate benefits for gas are short-term and potentially cancelled out with methane emissions created from gas production and its supply chain.

“Gas prices have been rising and all the evidence shows they will keep rising,” he said. “In contrast our report shows that renewable energy is now cost competitive with gas.”

The report also noted that, like the massive Carmichael coal mine, any new gas market infrastructure brought with it “substantial” stranded asset risks.

“The point is – we can do the job of reaching zero emissions power well before 2050 without gas,” said Climate Councillor and energy sector veteran Andrew Stock, who oversaw development of the last three large gas power stations built on the east coast.

“(And we can) do it even cheaper with renewables.”

The federal opposition, meanwhile, has seized the opportunity to attack Turnbull’s energy policy inconsistencies, describing his baseless claims about increased supply lowering gas prices as “his most farcical fizzer yet.”

At 8:37AM he promised listeners on Brisbane radio:

TURNBULL: Oh, no, it will be cheaper than the prices that are being offered now. People are being offered prices of $20 a gigajoule. It should be around half that or less.

By 11:32AM, less than three hours later, that promise was gone:

TURNBULL: This is not saying that all gas prices will be halved as a result of these changes.

“Today’s performance shows (Turnbull) is incompetent, dishonest and out of touch,” said climate and energy spokesman Mark Bulter on Thursday.

“The more we learn about the government’s gas plan, the weaker it gets.”

Activist group GetUp said Turnbull’s plan to use public monies to underwrite gas pipelines was “another white elephant”.

“Not content with handing over a billion dollars to prop up Adani’s doomed coal project, Turnbull now wants to spend public money on an expensive and unviable gas pipeline as well.” said GetUp’s Miriam Lyons.

“Spending public money on white elephants in waiting is a betrayal of everyday Australians who pay their taxes to fund public services and public-interest infrastructure.

“As with Adani’s doomed Carmichael project, a gas pipeline from the Northern Territory to Queensland doesn’t stack up economically,” Lyons said.

“It will also do nothing to stop price-gouging by greedy gas generators who have a stranglehold on the market for supplying power to meet demand spikes caused by heatwaves and cold snaps.

“The best thing we can do to break the power of greedy gas companies is to back the competition: cleaner, cheaper, fracking-free energy from solar and storage, as well as energy efficiency,” she said.

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  1. George Darroch 4 years ago

    This Liberal Government seems to be determined to throw our money away on fossil fuels.

    • Joe 4 years ago

      George, a misprint…”fuels” to read “fools” perhaps ?

  2. solarguy 4 years ago

    Sadly there will way to many weak heads in the pubs around Australia and around the bbq’s thinking Mal is the man.

  3. Nick H 4 years ago

    Why don’t renewable companies put their hand up for any of this NAIF slush money? It seems pretty bloody easy to get based on the track record.

    • Catprog 4 years ago

      Probably because it is not easy for renewables to get the slush money.

      • Joe 4 years ago

        If it is for “pumped Hydro”….full steam ahead with Captain Big Mal steering the ship.

  4. Ken Dyer 4 years ago

    How any government, no matter how poorly it manages the economy could even consider backing an international coal conglomerate that is technically bankrupt is beyond me. Is this responsible stewardship of taxpayer money? I don’t think so.

    This article appeared in the India Economic Times


    In short, India’s supreme Court has ruled that Adani cannot increase tariffs inline with increased import costs. Adani has booked that increase and removal of the increase will mean that they are insolvent.

    No wonder they want the Australian taxpayer to bail them out.

    • Joe 4 years ago

      Buy a “Pre Stranded Asset”…step right up Australia. We’ve got money to burn and willing to pile in on this crock of shite. It really is criminal. Climate change The GBR etc, no worries its all good. And there I was today listening to Fed Treasurer Scotty giving us a lecture about “Good Debt” and “Bad Debt”. I give up with these fools but Gautam Adani can keep his smiling face going a little longer. He must be pissing himself with laughter!

    • james gibson 4 years ago

      Do you think there should essentially be no jobs outside the major cities?

      Is it only moral to be a banker in inner city Sydney?

      What could replace the jobs that the Adani mine would create for regional Queensland? No, wind mills will not.

      • Ken Dyer 4 years ago

        James, what you ask is essentially uniformed. We know that Adani admitted that only 1400 jobs would be created and robots would do most of the work. We also know that their environmental record in India and elsewhere is absolutely abysmal, resulting in death and displacement of hundreds of people. So, if you want to ask about morality, have a look at Adani’s’track record before you start making accusations.

        If you look at jobs available right now, there are over 800 in Cairns and Far North Queensland. http://www.seek.com.au

        And you are mistaken as far as jobs created by renewable energy projects. The Queensland Government made this statement.


        So they have actually put up money for renewable energy jobs where they would not put up money for the Adani railroad. Go figure. So it would seem that backed by the Queensland Government, windmills will very likely provide plenty of jobs.

        I mentioned robots previously. Coal mining is a low skilled job. People need to realise this and make a positive move to upskill. It is only a matter of time before all those workers at coal fired power plants about to close will realise that their electrician skills are readily transportable to renewable energy. You might like to think about that.


  5. MaxG 4 years ago

    There is one answer to explain this madness — and I am surprised that so many ask “why” — telling me, they do not understand ‘neoliberalism’. It is the answer to how the western world works for the last five decades, and why this madness is going on. I highly recommend to those asking why, to read up on neoliberalism (any source as good as any other) and they will understand. Hopefully 🙂

  6. Malcolm M 4 years ago

    As a former North Queenslander, I can’t think of a worse way of investing a government-backed soft loan. The pipeline or railway would be built mainly by FIFO workers, after which a very small number of maintenance staff would be retained, its legacy being a virtually undetectable impact on the local economy. Examples of industries that have left a legacy are
    – tourism
    – tropical horticulture
    – defense
    – live cattle exports
    – long-term mines, such as Mount Isa, Phosphate Hill and Wiepa
    All these industries continue to employ lots of locals (ie relatively little FIFO), have made investments in infrastructure, and continue to keep the infrastructure operational.

    Those with genuinely good ideas for northern development, such as Genex with its solar and pumped hydro, or Windlab with its solar/wind Kennedy Energy Park, must cringe at how any of their representations for the Northern Australia Fund are quickly sidelined because they are not on the “right” side of the fuel debate.

    • nakedChimp 4 years ago

      The windturbine parts for Mt. Emerald are scheduled to pass my place in about 6 months – yay!

  7. Thucydides 4 years ago

    Malcolm Turnbull waxing lyrical about his cost saving plans for national infrastructure. What could possibly go wrong?

  8. Miles Harding 4 years ago

    Good on the Climate Council, firstly for surviving Tony Rabbit’s assassination attempt in 2013 and secondly for continuing to provide a voice of reason we can trust.

    The problem with allowing government to be controlled by narrow financial interests is that it can produce ridiculous and damaging policy, which is certainly the case here.

    This quest for gas supplies has a parallel with a crack addict feeding their addiciton. In this case, the same panicked feeling will overcome the market every few years, as each pocket of gas resource is depleted and another stash is sought.

    A far more rational policy would be to kick the crack and move away from these troublesome resources, but this seems hardly likely so long as we have a COALition government that is so obviously allowing greed to be its master.

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