June 24, 2013
Big mining doesn't agree that something--- housing investment and bigger export volumes?---will have to replace mining investment as an economic driver as the boom winds back. Big Mining holds that the mining industry saved Australia from the global financial crisis, that mining is Australia's destiny and Northeren Australia is the new frontier.
The Abbott-led Coalition agrees. The reason is that the international demand for rocks and coal is inexhaustible as the growing middle classes of emerging superpowers such as India and China require more electricity to power their new gadgets and appliances.
The problem with the above mining scenario is that energy efficiency and renewable energy are the key drivers to address the challenge of climate change and the goal of reducing emissions; and secondly, India and China are turning to renewables because it is cheaper than electricity from the predominantly coal-fired grid.
This reduced demand from India and China reduces the price of coal and, this in turn, raises the issue of the economic viability of the giant coal projects proposed for Queensland’s Galilee Basin--ie., the prices of coal would fall below that required to obtain a satisfactory return on investment in the mega mines. Carbon emissions from coal consumption are becoming a major constraint on its future.
This kind of energy transition undercuts the claims of the Australian Coal Association and the Minerals Council that there are no viable energy alternatives to coal. What the old order will do is to continue to dedicate vast resources to successfully preventing the introduction of sensible climate change policy in Australia. The Coalition will be captured.