In an era of alarm about climate change you would think there would be almost nothing easier than giving away $500 million to cut carbon dioxide emissions. Yet a Federal Government scheme is languishing, unable to give away their funding months after expected deadlines.
In June 2005, Industry Minister Ian MacFarlane and Environment Minister Ian Campbell called for applications to the $500 million Low Emissions Technology Development Fund (LETDF). 14 months later, they are yet to fund a single project despite the fact they were supposed to announce the successful applicants months ago. The Government is supportive of the coal industry, pinning its climate change hopes on attempting to clean up coal-fired power stations by funding carbon capture and storage (CCS) projects. This involves catching the greenhouse gases emitted by burning coal and burying them underground. Not only is this a difficult and expensive process, but it is many years away from being commercially viable.
It seems the LETDF bureaucrats are realising CCS does not stack up because it costs a bomb. Victoria’s Hazelwood, the dirtiest power station in the country, needs at least $100 million to achieve only marginal reductions to its emissions. It seems that carbon capture and storage projects are more costly than many large renewable energy projects, which can actually deliver huge cuts to greenhouse pollution at a fraction of the cost. But can you imagine the embarrassment if the LETDF gave away all its money to renewables schemes on the purely economic grounds that they are better bang for buck than CCS?
Not likely. Instead, the resource companies have been asked to go back and redo their numbers and show that it’s possible to bury carbon at a cheaper price. Unfortunately all their sums are commercial-in-confidence, so we won’t get to see if any corners are being cut in delivering the right response for the government.
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However, you can rest assured that Rio Tinto, BHP Billiton and the other coal producers will be polishing their dented silver bullet while an expected flurry of media releases from the proponents of so-called clean coal projects have already started as they jostle for a slice of the $500 million pie.