Updated
The LNP's election pledge for a new coal-fired power
station in north Queensland is akin to an idea conceived by "guys in a
bar who have had too much to drink", a former power company executive
has said.
Key points:
- LNP wants to build coal-fired power station
- Experts argue project not costed and could raise power prices
- Power station would require millions in subsidies
Chris Walker, who previously ran the rule over new coal power projects for Queensland's largest electricity generator, said a new plant would be commercially unviable, unlikely to bring down power prices and rely on "massive" taxpayer support.
The scathing assessment from Mr Walker, a former general manager at Stanwell Corporation, adds to mounting criticism of the LNP proposal by energy experts and conservationists.
Before and during the election campaign, the LNP vowed to champion a new 800-megawatt "ultra-supercritical" coal-fired power station to be built in Collinsville by private investors.
It maintains the "high efficiency/low emissions" (HELE) plant would help drive down electricity prices and shore up supply in the north.
The LNP enjoys some political support for the project, with One Nation leader Steve Dickson declaring it a "deal breaker" in any balance-of-power talks.
Prime Minister Malcolm Turnbull has also touted the project as a candidate for federal funding via the Northern Australia Infrastructure Facility.
Shadow treasurer Scott Emerson said a "hidden" report commissioned by Labor showed the project would actually lower emissions and provide cheaper power.
'Hidden' report lacks substance: experts
However, the report — which found a north Queensland coal-fired plant was only viable at prolonged high wholesale prices and with no carbon price more than 30 years — appeared to have been produced in just a few days, according to its own notes.
Photo:
Scott Emerson has accused the Government of not acting on a report, which he claims supports the plant. (AAP: Jono Searle)
And the company that produced it, Energy Edge, had expertise in energy trading but no experience in studying new power projects.
"It is a back-of-the-envelope exercise ... there is so much more you need to do," Mr Walker told the ABC."You have to analyse the market over 30 years, you have to analyse the nature of technology, regulatory risk, do the costings of different options, look at the transmission grid, concept studies, more detailed investigations of a few plausible options, prefeasibility analysis."
According to the "well-established methodology" for energy investment decisions, he said the concept of a north Queensland power station had not advanced beyond the level of "guys in a bar chatting about stuff".
Mr Walker said the report had likely overestimated the thermal efficiency of the station given its site, while capital and operating costs were "likely to be higher".
Mr Walker, who analysed a "supercritical" coal-fired plant proposal for Stanwell in 2009, said it was "ludicrous" for the LNP to say the report backed its plan.
Power plant would cost taxpayers billions
Meanwhile, energy economist Hugh Grant, a former manager at state network operator Powerlink, said the proposed plant was "uneconomic", while economist John Quiggin said it looked "certain to become a stranded asset".And a new report by the Australian Conservation Foundation (ACF) claimed the plant would cost taxpayers an extra $7 billion over its 30-year lifetime from pollution-related disease, climate change impacts and government subsidies.
ACF economist Matt Rose said the plant would cost Queensland taxpayers $1.6 billion to $3 billion to build.
He said it would cost another $230 million a year in government subsidies, health impacts from pollution and climate change impacts.
The ACF based its figures on a 2009 Australian Academy of Technological Sciences and Engineering report.
"To choose coal when clean energy alternatives are so much more affordable, and don't hurt nature, cause climate pollution, or damage the health of Queenslanders, is a shocking decision," Mr Rose said.Mr Quiggin, an Australia Laureate Fellow in economics at the University of Queensland said it was "hard to see any financial institution taking a risk on this".
If the LNP took office, this raised the question of whether state taxpayers would be "forced to bear the entire risk", he wrote for The Conversation.
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