The gas industry’s peak body has called into question claims made by the coal industry regarding the respective cost of the two fuels, adding to the public debate over the future viability of ‘coal versus gas’.
The gas industry’s peak body has called into question claims made by the coal industry regarding the respective cost of the two fuels, adding to the public debate over the future viability of ‘coal versus gas’.
Australian Petroleum Production and Exploration Association WA director Don Sanders bought-in to the issue following statements by coal miner, Griffin Group.
Fuelling the debate was the recent naming of seven bidders for Western Australia’s next base-load power station, which is likely to cost up to $500 million.
It’s expected the successful bidder to supply the South West of WA with an additional 300 MW of electricity will be announced by the State Government by mid 2005.
“It’s a bit misleading to run around in the public arena, as representatives from Griffin and Wesfarmers Coal have been recently, quoting coal at $1.70 per gigajoule and natural gas at $3 per GJ, and using that information as a reason for deciding what fuel our next major power plant will use,” Mr Sanders told WA Business News.
“What the coal industry people fail to mention is that of the $3/GJ cost for gas, around $1 of that is contributed to government revenues as royalties and taxes, which pay for such things as roads, schools and hospitals.
“What matters most to many electricity consumers are the costs of generating electricity, either from gas or coal, and when you sit down and do the sums, coal and gas cost about the same in WA.
“The oft quoted $1.70/GJ for coal is the minimum price for Collie coal, which can range up to $2.75/GJ according to Griffin Coal, at that price gas comes out on top in the electricity stakes.
“When you look at the environmental benefits of gas over coal for electricity generation, gas again comes out on top. According to the Australian Coal Association, a modern gas power plant will produce just over half the green-house gas emissions than a modern coal power plant of the same capacity.
“We need to introduce some fundamental facts into this important debate in order to make the right energy decision for all Western Australians.”
As reported in WA Business News on June 24, the coal industry has also been spruiking the benefits of its product, including challenging the perception that it is a ‘dirty’ industry. The industry instead is highlighting surety of supply and its role as an employer.
Griffin Group and Westfarmers Premier Coal have deposits that could last another 100 years, and directly employ about 600 people in the town of Collie.
