Victoria affirms commitment to coal

The Minerals Council of Australia (MCA) has endorsed the Victorian Budget’s strong contribution to sustainable economic growth, to effective climate change policies and to addressing capacity constraints in the economy that threaten the scale and longevity of the present minerals industry expansion. The Budget confirms the Victorian Government’s commitment to clean coal technologies as a cornerstone response to the challenges of reconciling energy security with climate change.
MCA, Executive Director, Victoria, Chris Fraser said: “the Victorian Budget provides a responsible basis to ensure strong sustainable development of the State that is financially sound and delivers effective environmental and social dividends. It provides the framework to enable the minerals industry to continue to make a significant contribution to the economic and social development of the State, particularly in regional and rural Victoria.
This commitment is especially significant in the Government’s initiative to expand the Energy Technology Innovation Strategy (ETIS) by A$110M, which is supported by the MCA.” The A$110 million commitment is to support new large-scale pre-commercial Carbon Capture and Storage (CCS) demonstration projects in Victoria. This will assist greatly in mastering clean coal technologies and ensuring that the State’s vast resources of brown coal can continue to underpin Victoria’s economy,” Fraser said.

In addition, the State budget confirmed that A$12.2 million would be made available for the establishment of Clean Coal Victoria and a further A$5.2 million for investigating carbon storage sites in Gippsland. “The commitment to establish Clean Coal Victoria fulfils an obligation made prior to the last election, but more importantly allocates additional funds to those originally proposed. These extra funds will make Clean Coal Victoria far more capable of
contributing to the strategic development of the Gippsland coalfields, Fraser said.

“The long term development of the vast Gippsland coalfields and Victoria’s realisation of its incredible natural endowment depends upon the ability of coal users to reduce greenhouse gases – the ‘clean coal’ solution. That is, solutions to the critical economic, regulatory and technological constraints for the capture of carbon dioxide from processing plants, transporting the carbon dioxide and burying the carbon dioxide deep underground. Work is required on the critical constraints to capture, transport and storage and the funds announced in the budget today will assist greatly in meeting that challenge.”

“On the matter of research, development and demonstration funding more generally, the MCA is disappointed that the Budget has deferred further financial commitment to an innovation statement that the Government signalled will be made later in the year. Victoria has a strong base for research and development in the minerals industry and, as identified in the Innovation Roadmap of Victoria’s Earth Resources prepared by the Victorian Government and Minerals Council of Australia in 2006, it is good business for government to participate in pre-competitive minerals research in Victoria.

“We hope that the innovation statement identifies this benefit and that the Brumby Government earmarks research, development and demonstration funding for the minerals industry in future,” Fraser said.

MCA is also disappointed that the Budget did not take the opportunity to substantially increase spending on vocational education and training. “The Australian economy is limited in its ability to grow due to critical and in some cases chronic shortages of skilled workers. This is especially the case in the minerals industry which will need an additional 27,000 skilled trades people by the year 2015. The vocational education and training sector is in dire need of reform and this includes the injection of additional funds. It is hoped that the Victorian and Australian Governments urgently address this critical capacity constraint in future,” Fraser said.