As world leaders meet this weekend in the hope of agreeing to tighter global emission targets, carbon-intensive industries operating in Australia are watching closely.
- Carbon-intensive industries in Australia are looking to reduce emissions in line with internationally accepted targets
- Most of Australia’s carbon industries have specific targets, but they differ markedly with little coordination
- Hydrogen is increasingly seen a future source of energy, but the uptake so far is slow
The 2020 United Nations Emissions Gap report this week found that despite a brief dip in carbon dioxide emissions caused by the COVID-19 pandemic, the world was still heading for a temperature rise in excess of 3 degrees Celsius this century.
That is far beyond the Paris Agreement goals of limiting global warming to well below 2C and pursuing 1.5C.
Australia has promised to cut its 2005 emission levels by 26-28 per cent before 2030 as part of the Paris Agreement and is now on track to meet those targets without the need to count carry over credits, the Federal Government said this week.
Meanwhile, there are no agreed targets for businesses in Australia, nor a mechanism to ensure they commit to meaningful targets.
Richie Merzian from the Climate Institute says this poses a real problem.
“The Government system is pretty weak so it doesn’t actually cap those emissions,” he said.
“If you are a company that has very little public profile, you have no retail facing element to your company, then you could try and hide behind the barriers and try and get away with it.
Coal expansions continue to be approved
Wollongong Coal is an Illawarra-based coal miner exporting all its coking coal to India, so has little interaction with the local community.
This week it gained approval to reopen its mothballed Russell Vale mine and generate 1.5 million tonnes of CO2 emissions over five years.
As part of the approval process it was required to do little if anything to reduce emissions, and does not mention emissions at all in its environmental policy published on its website.
It was also not required to reduce carbon emissions in the final approval report from NSW Department of Planning, Industry and Environment (DPIE).
“The project, in isolation, is unlikely to influence global emissions and climate change trajectories,” the DPIE report said.
Another coal mining company, South32, is seeking approval to extract 78 million tonnes of metallurgical coal from its Dendrobium mine expansion project near Wollongong up until 2048.
As well as coming out strongly to sell the benefits of ongoing employment, and coal supply to the Port Kembla steelworks, South32 is actively promoting its emission targets.
“South32 is committed to achieving net zero emissions by 2050,” a company spokesman said.
The spokesman said the company supports the Paris Agreement objectives to limit global temperature rise to below 2C this century, and is working on ways to decarbonise its operations by reducing Scope 1 emissions at its Worsley Alumina mine in Western Australia and its Illawarra mines.
“At Appin Mine, our gas drainage and capture network enables the reuse of waste coal mine gas to generate power,” the company said.
“In 2019, the gas captured was used to generate equivalent electricity for around 52,000 homes, or roughly 45 per cent of all homes in Wollongong.”
South32 has also completed a 7,200-panel solar farm in Cannington in Queensland to offset gas consumption with solar energy.
But does this go far enough to enable to company to achieve significant carbon emission targets?
Creative accounting in emissions
Mr Merzan from the Climate Institute said commitments to offset emissions by coal mines need to be looked at carefully.
“A coal mine is a hard one to offset because you have got the emissions that come with the actual production of the coal, but then most of the emissions from coal come when you actually burn it,” he said.
Scope 3 emissions refer to emissions not generated directly by the miner, but indirectly by the consumer — and often in another country.
“The best practise is to offset your entire carbon footprint, that includes the Scope 3 emissions.”
Greg Bourne from the Climate Council is a former president of BP Australasia and believes the road ahead will vary a lot, depending on what kind of company you are.
“If you are talking steel, to move from using coking coal to make steel to eventually move to using hydrogen, or hydrogen mixed with other gases, to create steel is actually a fundamental restructuring of that part of the industry,” he said.
“Given they compete against each other it’s going to be capital intensive, its going to be difficult.”
For Bluescope Steel, Australia’s largest steelmaker with extensive operations also in South-East Asia, South Asia, North America and New Zealand, the transition is underway but yet to fully ramp up.
The company supports the 2050 Paris Agreement target and has a near-term target of reducing “carbon emissions intensity” by at least 12 per cent by 2030.
Bluescope may also be working on plans to transition to so-called “green steel” and to adopt hydrogen into its energy mix.
The company in November this year announced a $20 million investment program in conjuction with the NSW Government to manufacture components used in wind and solar projects, but is yet to go into detail on plans for green steel.
“Watch this space as we will have a lot more to say in the new year,” the spokesman said.
Hydrogen seen as a way out of coal
Either way, the use of hydrogen could be the key to bringing emissions towards zero, including offsets.
CSIRO director of hydrogen energy Dr Daniel Roberts said hydrogen was still largely limited to industrial applications in Australia — fertilisers, explosives, oil refining processes and the like — but its use was becoming more widespread.
He said, in Australia, ‘brown’ hydrogen was usually made from natural gas, while in some locations ‘black’ hydrogen was made from coal.
But making both ‘blue’ and ‘green’ hydrogen opened up significant opportunities to decarbonise the smeltering process.
“The carbon credentials of using hydrogen in any process relies strongly on where you get that hydrogen from,” he said.
“Hydrogen from renewables via electrolysis is one way to go, and making it from gas and storing the CO2 is also carbon neutral and could be another way to go.”
Mr Bourne from the Climate Council said it was important to keep all energy pathways open without relying too heavily on potential fixes.
“The key thing is not to use ‘hydrogen as coming along’ as an excuse not to do the hard graft today,” he said.
“We have to do all of that, and as we do that over this decade we will build the possibilities of a new hydrogen industry. But its not an either-or.”