Mining of Fossil Fuels

Fossil fuel mining and in particular coal mining in Australia is receiving a lot of attention. The link has been made between the fossil fuels being mined and the greenhouse gas emissions generated when the fossil fuels are eventually burned, even if they are burned outside of Australia. And so the question arises whether Australia should phase out fossil fuel mining. There are some tricky facets to this question:

• Cutting off other countries from their supply of fossil fuel while countries which have plentiful supplies in the ground, such as Australia, continue to use fossil fuels is morally unappealing, to me at least.
• Generating electricity from natural gas emits less carbon then generating it from coal. Also, because gas-fired power stations can be turned on and off more easily, they are better for supplementing renewable energy. While all fossil fuel use must end eventually, we would not want to create a situation where other countries use more coal simply because it is easier to obtain than natural gas.

Australia is a technologically advanced country with enormous potential for renewable energy. So I believe that Australia should show leadership in the transition to renewable energy here in Australia, ahead of any attempt to force other countries to make the transition by restricting fossil fuel exports. In other words, our use of fossil fuels should fall more quickly than our exports of fossil fuels.

With regard to coal mining, I would support explicit legislation to ban new coal mines provided that we also have explicit legislation to ban new coal-fired power stations here in Australia. Obviously we should not retrospectively outlaw coal mines which have already been approved, such as Adani's Carmichael coal mine. A legislated ban on new coal mines may appear quite drastic. However I doubt that even without such a ban and in the absence of subsidies or concessional tax treatment, there will be many new coal mines considering the trouble Adani had obtaining finance for the Carmichael coal mine.

You may well be worried about the impact on our economy when first coal mining and later other fossil fuel mining winds down. But consider this:

• It is inevitable that fossil fuel mining will end sooner or later. It is just a question to what extend public policy should hurry this process along.
• Australia also has lithium deposits which will be increasingly important as cars go electric.
• Australia also has a huge potential to produce renewable fuel, such as hydrogen produced through electrolysis. To realise this potential, we need to develop renewable energy because the idea that other countries will buy hydrogen made with greenhouse gas emitting technologies is fanciful.

Right now, there are some things Australia can do with regards to fossil fuel mining.

• Raise a special federal tax on mined fossil fuels to be placed into a fund for retraining workers when phasing out fossil fuels eventually begins.
• Ensure there is no concessional tax treatment for any new fossil fuel mining investment. Oil and gas projects in particular are currently receiving overly generous tax treatment. See this ABC article.
• Not have hidden subsidies for fossil fuel mining such as government funding for transport infrastructure to be used primarily to transport extracted fossil fuels.
• Have a 90% federal tax on any state royalty holidays on new fossil fuel mining projects.