The Sunday Essay: How Australia’s coal madness led to AdaniPublished by MAC on 2019-06-16
Source: The Monthly (2019-04-01)
Dark elephants in the room
The following lengthy piece was written by a prominent conservationist over two months ago.
Nontheless, although Adani's Carmichael super-project in Australia has since been granted the go-ahead, James Bradley spares no word of condemnation for the abundance of intrigues and manipulations leading up to this decision.
He targets, inter alia, the issues of adverse climate change (and denial); the flagrant dismissal of Aboriginal land rights; Adani's gross pursuit of distincly dirty profits - in both Australia and India; and its lies to the domestic workforce about creating thousands of new jobs.
Adani has recently sought to address some of the socio-environmental impacts of the project by making modifications to its earlier proposals which it claims will signifcantly reduce it in size.
These corporate moves - cosmetic as many of them are - may have persuaded Australian bigwigs to allow the Carmichael mine-railroad-port infrascture plan to proceed.
But these changes in no way answer those ongoing legal and other challenges to a venture that surely encapsulates some of the darkest "Elephants" in any current "Rooms" on earth.
[Comment by Nostromo Research]
How Australia’s coal madness led to Adani
The real reasons keeping the Carmichael mine alive
The Monthly (Australia)
Head west from Townsville and time seems to shift. As the sudden hills of the coast give way to open country the terrain spreads out: forest replaced by vagrant woodland and scrubby brigalow, the deep red shapes of termite mounds protruding from the grass like countless miniature megaliths. Above the road wheel black kites and wedge-tailed eagles; once a mob of red-tailed black cockatoos floats by, calling mournfully, their massive heads and bodies suspended aloft on slow-beating wings.
For the Aboriginal people whose country it is, this is a living landscape, a web of meaning and obligation given shape by the stories that connect them to the land. Out here those stories feel close at hand, their presence palpable. Time inheres in the landscape, a reminder of the depth of human habitation, of the lines of story and cultural knowledge that connect the present day to the deep past.
Yet the memory of another past is also inscribed in this land. Along with the Bowen Basin to the east and the Cooper Basin to the south-west, this region – the Galilee – is part of a vast basin system stretching through Queensland’s interior, whose sandstone hills and lowlands obscure huge reserves of coal, much of it formed more than a quarter of a billion years ago during the Permian.
The world of the Permian was quite unlike the planet we know today. Earth’s continents were all still part of a single landmass, Pangaea, which stretched from near the North Pole to what is now Antarctica, while an immense ocean known as Panthalassa covered the remaining two thirds of the globe. Although primitive trees had begun to appear, grass and flowering plants did not yet exist. Instead, amphibians, reptiles and synapsids such as the sail-backed dimetrodon grazed and hunted amid ferns and cycads, while in the ocean invertebrates such as the nautilus-like ammonoids reigned supreme.
The Permian ended with the single largest extinction event in Earth’s history so far. The exact origins of this wave of extermination are not entirely understood, but what we do know is that a burst of almost unimaginably violent volcanic activity ignited enormous beds of coal, oil and gas laid down during the Palaeozoic era, triggering the release of huge amounts of greenhouse gases. This lifted global temperatures by 6 degrees Celsius or more and led to rapid ocean acidification and marine anoxia. In combination, these wiped out most life on Earth, and caused the extinction of a staggering 70 per cent of terrestrial species and 96 per cent of marine species.
Scientists and miners have known of the existence of the coal reserves beneath the Galilee for decades. Yet the recent history of the region really begins in 2008, when Clive Palmer’s Waratah Coal reported the discovery of 4.4 billion tonnes of coal near the town of Alpha, and announced plans to invest $8 billion in a mine in the area.
Naming the mine China First, the ever-ebullient Palmer was soon spruiking the project’s benefits. Involving not just the mine itself but also a power station (coal powered, naturally), a new port and a 495-kilometre railway, it would, Palmer declared, produce 40 million tonnes of coal annually for the booming Chinese economy, and create up to 7500 jobs. Even better, it would be mostly financed by Chinese investors. As Palmer noted at the time, “When you need a lot of money there is no better place to get it than in China.”
While Palmer had got there first, he was not alone in his interest in the region. As growing demand from China and India drove coal prices to historic levels, other companies began to announce projects in the Galilee. Together with Indian billionaire Gunupati Venkata Krishna Reddy, Gina Rinehart’s Hancock Prospecting outlined plans for a joint venture, GVK Hancock, to develop a second mine near Alpha; the Australian subsidiary of Chinese company Shanxi Meijin, MacMines, proposed what it called the China Stone mine in the Galilee’s north; and, perhaps now most famously, in 2010 Indian billionaire Gautam Adani announced plans to build a mine at Carmichael, some 160 kilometres north-west of Clermont.
But it was not until 2012 that the full scale of what was taking shape in the Galilee became clear. As a Greenpeace report released that year showed, a total of nine mines had already been proposed by various companies, five of which would be among the biggest in the world. Collectively these mines would produce up to 330 million tonnes of coal a year, more than doubling the amount of coal Australia exported. And when burned, this coal would release more than 700 million tonnes of carbon dioxide, 120 million more than Australia’s total annual emissions at the time. Indeed, such emissions would, in 2012 at least, rank as the world’s seventh-largest emitter, were the Galilee projects considered a country. As the Greenpeace report said, “At a time when the science could not be clearer on the need to reduce global carbon emissions, and when governments worldwide are shifting to a low-carbon economy, exploiting the Galilee Basin is a reckless proposition.”
The Greenpeace report provoked predictable responses. Mitch Hooke from the Minerals Council of Australia decried attempts to emasculate the Australian economy, while the then resources minister, Martin Ferguson, muttered darkly about elaborate strategies designed to destroy Australian industries and jobs. Trade Minister Craig Emerson said environmentalists were deluding themselves if they thought the world was going to switch to renewable energy; attempting to do so would result in “a global depression” and “mass starvation”. Prime Minister Julia Gillard weighed in, reassuring people the coal industry had a “great future” in Australia.
Although GVK Hancock’s Alpha mine was the first to be approved, it was Adani’s Carmichael mine that pushed ahead the fastest. Incorporating six open-cut pits and five underground mines, Carmichael would not just be bigger than any other mine in Australia, it would be bigger than almost any mine in the world. With its pits and mines spread over a site almost 50 kilometres long and 10 kilometres wide, Carmichael would eventually disturb almost 280 square kilometres. Even the smallest of the six pits was to be 6 kilometres long and 1.7 kilometres wide; the largest would be 8.5 kilometres long and 3.5 kilometres wide.
Development on this scale was justified by the potential wealth buried beneath the ground. Adani estimated that the four major seams it intended to mine contained 8.3 billion tonnes of coal, so much that even at an annual output of 60 million tonnes it would take 150 years to exhaust the mine. Along with the mine itself Adani proposed constructing an airfield capable of transporting workers in and out and a rail line connecting the mine to the Abbot Point coal terminal, just north of Bowen.
This rail line was an essential part of the plan. Gautam Adani’s empire had been built around a vertically integrated business model that involved extracting coal cheaply from Adani-owned mines in Indonesia, shipping it to Adani-owned ports in India and burning it in Adani-owned power plants. Just as the coal extracted at Carmichael would help underpin the company’s plans for further expansion in India, management of rail and ports in Australia would ensure it maintained control over its supply chain. And in the long term, it would make other projects in the Galilee viable by putting in place the infrastructure required to move even more coal to the coast.
The sheer scale of the project was matched by its cultural and environmental implications. The land it would destroy is of deep spiritual significance to the Wangan and Jagalingou people. The mine also had the potential to harm several threatened species, and to significantly affect the watertable in surrounding areas. And then, of course, there were the greenhouse gases that would result from burning the coal produced at the mine. On an annual basis these would be equivalent to 14 per cent of Australia’s total domestic greenhouse emissions in 2010, or close to triple the 5 per cent emissions reduction target then in place, and over its 60-year life the mine would produce 4.7 billion tonnes of carbon dioxide.
Despite the bruising failure of the climate negotiations in Copenhagen in 2009, there was no longer any question the world was on track for catastrophic global warming without decisive action. Yet over the months and years that followed, Carmichael and the other mines in the Galilee were actively supported by politicians, the bureaucracy and the mining industry’s barrackers in the media.
The Queensland government was an early and eager convert to the campaign to open up the Galilee. In 2010, Labor premier Anna Bligh launched what was dubbed CoalPlan 2030, a document that proposed doubling coal production in the state to 340 million tonnes a year over the next two decades, while envisioning the possibility that this already ambitious figure might be further supplemented by new developments in and near the Galilee. The plan also foresaw substantial government investment in infrastructure such as rail and ports to facilitate this growth.
Three years later, the newly installed Campbell Newman government went even further, with its Galilee Basin Development Strategy (GBDS). Designed to smooth the way for mining companies eager to extract the coal and gas beneath the region, the strategy proposed “streamlining” the approval processes surrounding environmental assessment, planning, land acquisition and native title, as well as floating the idea of discounted royalty payments for projects that were quickest off the mark. Industry figures were delighted. Queensland Resources Council CEO Michael Roche was particularly impressed by the proposed royalty reductions, which he described as “innovative”. Noting the challenges posed by the Galilee’s lack of existing infrastructure and distance from ports, especially in difficult market conditions, he conceded that these projects would eventually have to stand on their own, but in the meantime the GBDS could help them over the line. “The combination of the coordination powers of government together with some royalty reliefs may well make the difference.”
In line with its GBDS, the Newman government did everything in its power to remove potential roadblocks to the project. Despite a shocking record of environmental mismanagement in India, Adani was waved through as a “suitable operator” under Queensland’s Environmental Protection Act; likewise the state government ignored environmental concerns about the project, raised by the Commonwealth’s Independent Expert Scientific Committee on Coal Seam Gas and Large Coal Mining Development, in particular its effects upon the Carmichael River and ground-water, as well as questions about the quality of the data Adani had relied upon in developing its assessment of the environmental impacts. The state government also did its best to protect the project from objections by landowners, community groups and environmental groups, ramming through legislation that abolished the public’s right to object to proposed mines unless they were directly affected.
Nor was the Newman government’s support confined to facilitating regulatory approvals and stifling dissent: in November 2014 Newman announced the state government would help fund the proposed rail link to Abbot Point as part of a larger deal designed to secure the project a $1 billion loan from the government-owned State Bank of India. Exactly where the money would come from wasn’t clear, but Newman indicated it would be raised by disposing of government assets.
Meanwhile the project had also found backers in Canberra, where Tony Abbott’s government had committed $5 billion to its Northern Australia Infrastructure Facility (NAIF). Widely criticised for poor governance, lack of transparency and conflicts of interest, NAIF was ostensibly part of a broader strategy to unleash the economic potential of the region, but even before the fund was formally established Treasurer Joe Hockey and Resources and Energy Minister Josh Frydenberg were arguing it could be used to underwrite Carmichael’s rail link.
Although Adani had its political patrons, behind the scenes serious questions were being raised about the project’s economic viability. In 2015, documents released under freedom of information laws revealed that, even as the Newman government was doing everything in its power to push the project through, Queensland Treasury was arguing Carmichael was unbankable and raising concerns about the project’s lack of transparency and long-term viability. Reasoning that the project was better understood as a play for the Indian energy market than an Australian coal project, Treasury officials said Adani’s financial structure and indebtedness made it “highly susceptible to cost shocks”, and that while coal projects were not being boycotted by financial institutions, it was “fair to say that there is not a lot of market support for investing in Galilee thermal coal projects at present”. In one email sent only days before Newman’s announcement the government would help fund Adani’s proposed railway, Treasury analyst Jason Wishart advised the project was “unlikely to stack up on a conventional project finance assessment”.
Nevertheless in May 2014 the Queensland government approved the project, subject to the approval of the Commonwealth, which Environment Minister Greg Hunt duly provided a few weeks later.
One could have been forgiven for thinking the project was now unstoppable.
Officially at least, government support for Carmichael has been driven by its supposed economic benefits, and claims the project will create at least 10,000 jobs and generate $22 billion in taxes and royalties.
It’s not difficult to see why the promise of jobs resonates in Australia’s north. In Townsville, unemployment hovers above 9 per cent, compared to around 6 per cent in Queensland as a whole, while in inland areas it is even higher. Youth unemployment is particularly acute: in September 2018 in Townsville 17.7 per cent of people aged 17 to 24 were out of a job.
Yet the claims made about Carmichael’s economic benefits are highly questionable. When asked in court in 2015, Adani’s financial controller, Rajesh Gupta, not only conceded that government revenue from the project was unlikely to exceed $7.8 billion, he repeatedly declined to rule out taking advantage of tax minimisation schemes to shift potential profits offshore to tax havens and lower-tax jurisdictions such as Singapore. Other witnesses, such as energy analyst Tim Buckley, went further, arguing that Adani was “going to lose money at … the operating level [so] it actually won’t pay any tax”. Similarly when former Reserve Bank economist and Adani consultant Jerome Fahrer was pressed on the question of jobs, he admitted the figure of 10,000 was “extreme and unrealistic”. Instead, Fahrer argued that, at the peak of construction, the project would employ approximately 2400 people, but because many of these jobs would come at the expense of those elsewhere, the number of jobs actually created would be considerably lower. Instead, Fahrer said that over the life of the project an average of 1464 full-time equivalent direct and indirect jobs would be created.
It is possible even these estimates overstate the project’s benefits. Adani’s vision has always been for an operation that is automated from “pit to port” in an effort to improve productivity and reduce workforce numbers. In 2016, economist John Rolfe said these strategies had the potential to move jobs away from the mine itself and into urban centres, a process that has already been observed in Western Australia, where Rio Tinto controls driverless trucks in several mines from an operation centre in Perth. Likewise research by The Australia Institute suggests development in the Galilee would lead to significant job losses at existing coalmines elsewhere in Australia, potentially eliminating up to 9000 jobs in the Hunter Valley, 2000 in the Bowen Basin and 1400 in the Surat Basin.
The nature of the contemporary media landscape means claims by politicians and industry groups are frequently reported without proper scrutiny, allowing lies and hyperbole to ossify into what passes for fact. Yet even in such an environment, the comprehensively discredited figure of 10,000 jobs has proved remarkably resilient. Eighteen months after Fahrer’s evidence, Queensland premier Annastacia Palaszczuk was still repeating it, telling journalists that not only would the project last for 50 to 60 years and generate 10,000 jobs, but that those jobs would be “generational jobs”. In 2017 former prime minister Malcolm Turnbull went in even harder, saying the project had “huge economic benefit”, and would generate “tens of thousands of jobs”. Indeed as recently as February last year, Adani was still repeating the claim, saying that the Carmichael project “will create 10,000 direct and indirect jobs”.
Of course there is nothing new about politicians inflating the benefits of projects with which they are associated. Yet why continue to repeat figures they ought to have known were false? The simplest answer is because it works, or at least politicians and others think it does. Like the political predilection for being photographed wearing hardhats and hi-vis, pretending that people have a choice between jobs and the environment is a very old, and usually very effective, piece of political messaging. As a bumper sticker reportedly seen in Townsville read, “Don’t take my job and I won’t take your soy latte.”
It also speaks to the enduring mythology that surrounds the coal industry, and the assumption that its significance to the economy means what is good for coal is good for Australia. Although coal accounts for almost 15 per cent of Australia’s total exports, coalmining makes a surprisingly small contribution to government revenue: even with coal prices at historically high levels, in 2017–18 coal royalties only accounted for around 6.4 per cent of Queensland government revenue, a figure that is projected to fall to 4.6 per cent by 2021–22 as coal prices decline. To put that in context, in 2017–18 income from motor vehicle registrations accounted for 3 per cent of government revenue. In New South Wales, coal’s contribution to government revenue is less than 2 per cent. The coal industry’s contribution to federal coffers is also minimal: according to analysis by The Australia Institute in 2013, combined revenue from company tax and the Mining Resources Rent Tax from the coal industry accounted for less than 1 per cent of Commonwealth government revenue.
Nor do the profits from the industry make their way back to Australia. Mining in Australia is dominated by foreign companies, meaning the vast bulk of profits flow offshore. Indeed a 2017 study found 86 per cent of the Australian mining industry is foreign owned. Indirect benefits are also mostly enjoyed offshore, courtesy of the fact most of the plants and equipment are purchased overseas.
Despite its significance to communities in the Hunter and elsewhere, the coal industry’s contribution to employment is also relatively modest. In November 2018 the industry employed slightly fewer than 50,000 people. This is less than 0.4 per cent of Australia’s total workforce and a fraction of that employed in industries such as construction, tourism and education. Meanwhile, the coal industry continues to receive high levels of public assistance: between 2008 and 2013 in Queensland alone, the government outlaid more than $8 billion on projects to benefit the coal industry. Queensland Treasury has conceded this “means less infrastructure spending in other areas, including social infrastructure such as hospitals and schools”.
In recent years the mythology surrounding coal has become entangled with the network of money and influence that underpins the climate denial industry. The links between the fossil fuel industry and many influential climate deniers has been extensively documented both here and overseas. It is no coincidence, for instance, that the Institute of Public Affairs, an organisation with a long history of promoting climate-change denial, has received millions in funding from Gina Rinehart, or that Rinehart has supported the careers of prominent climate deniers such as Andrew Bolt and Ian Plimer and sponsored lecture tours by the likes of Christopher Monckton. Nor that, as Sky News and the Murdoch media demonstrate, climate denial and the promotion of coal have become central to the political identity of the contemporary right.
Yet it is possible to discern the outline of a much more disturbing story in the eagerness of politicians to spruik projects like Carmichael. In a 2015 article published in Guardian Australia, journalist Graham Readfearn detailed the ways in which Adani has courted political leaders from both sides over many years. In 2010, while in India on a trade mission, Premier Anna Bligh met with Gautam Adani and his international development executive Harsh Mishra, and this led to an invitation for Adani and Mishra to meet with the Queensland coordinator-general. When Campbell Newman became premier he also visited India as part of a trade delegation, attending a 76-person tour of Adani facilities and a lavish reception at Gautam Adani’s home. In 2013 the then deputy premier, Jeff Seeney, led another delegation, receiving similar treatment and meeting with Adani and Gujarat chief minister (now prime minister) Narendra Modi, followed by a private dinner with the Adani family and company executives.
Of course there is nothing inherently untoward about these sorts of meetings: the whole point of trade delegations and international visits is to broker relationships and promote investment opportunities. Nonetheless they underline the ways in which companies such as Adani use their immense resources to court politicians and policymakers and buy access others cannot.
And these meetings are only the tip of the iceberg. For decades, the mining industry’s special relationship with government has been underpinned by generous donations to both sides of politics. In a 2018 report for the Grattan Institute, researchers Danielle Wood and Kate Griffiths revealed that in 2015–16 and 2016–17 the mining industry accounted for a whopping 22 per cent of all corporate donations, more than any other industry sector. As Wood and Griffiths dryly note, such donations “build relationships and a sense of reciprocity”.
Miners also spend big on lobbying. In the 10 years to 2017, the mining industry poured well over half a billion dollars into lobby groups such as the Minerals Council of Australia, the Australian Coal Association and the Queensland Resources Council. And this amount only relates to expenditure on these peak lobbying groups: once expenditure on private lobbying firms and internal public affairs and government relations is added, the total amount spent on trying to influence government policy and public debate would be significantly higher.
Donations and lobbying are also only the most visible dimension of a far more extensive system of relationships and insider access. The plushly carpeted path from ministerial offices to the boardrooms of mining and resource companies is a well-trodden one. Those who have made the transition from federal politics in recent years include former federal resources minister Martin Ferguson, who left parliament to chair the advisory board of the Australian Petroleum Production and Exploration Association; former industry and resources minister Ian Macfarlane, who became CEO of the Queensland Resources Council six months after leaving parliament in 2016; Gary Gray, who after a stint as ALP national secretary took up a position with Woodside Petroleum for seven years before returning to parliament and being appointed the minister for resources and energy; and former deputy prime minister and now chairman of Whitehaven Coal, Mark Vaile. The list goes on and on.
Such appointments are not difficult to understand. Politicians bring deep networks within politics and bureaucracy, as well as an intimate understanding of how to make things happen. They also – usefully – wield this influence largely unseen: despite the introduction of lobbyists’ registers at both state and federal level in recent years, the activities of the peak bodies and corporations whose offices so many politicians grace are not classed as lobbying.
Nor is it just politicians. A 2015 report by Graham Readfearn for The Australia Institute identified what it called “a systemic web of access and influence for fossil fuel companies”, that sees individuals move seamlessly and without scrutiny between ministers’ offices, government departments, and mining and industry organisations. Readfearn’s research focuses on figures such as Geoff Dickie, who as Queensland’s deputy coordinator-general was responsible for assessment and approval of major infrastructure projects, and left that role to work for the Queensland Exploration Council, and Michael Roche, who held senior positions in the Department of Prime Minister and Cabinet and the Queensland Government and Cabinet Office before taking up his position as CEO of the Queensland Resources Council. But it is not difficult to find other examples. Scott Morrison’s chief of staff, John Kunkel, came to Morrison’s office after six years as deputy CEO of the Minerals Council and a two-year stint as head of government affairs at Rio Tinto; likewise Turnbull’s climate and energy adviser Sid Marris moved directly into the prime minister’s office from a role with the Minerals Council, a role that was soon filled by Patrick Gibbons, Environment Minister Greg Hunt’s former adviser. (Marris also worked at The Australian for 16 years.)
Or perhaps one might turn to former Queensland Labor Party state secretary Cameron Milner. Along with Campbell Newman’s former chief of staff, David Moore, Milner is one of the directors of “strategic public affairs advisory” firm Next Level Strategic Services, who were engaged as lobbyists by Adani in February 2015. Yet at the same time as he was working as Adani’s lobbyist, Milner was also working for the Labor Party. In September 2015 he took leave to work as Opposition leader Bill Shorten’s chief of staff, and after returning to his role at Next Level, was intimately involved in the Queensland Labor Party’s 2017 election campaign. In fact Milner only stepped back from his dual roles when they became a political liability for the Labor Party. (When asked whether she saw a conflict between his role for Adani and his role in Labor’s campaign, Palaszczuk’s office dismissed the idea, instead praising the public-spiritedness of those who, like Milner, chose to rally to the party’s aid at election time.)
For those embedded within this system of musical chairs and mutually beneficial outcomes, this all probably seems like little more than the way things get done, or what economists Cameron Murray and Paul Frijters have dubbed the “game of mates”. Yet it is better understood as what economists and political scientists describe as policy or regulatory capture, a form of government failure in which policy decisions are shaped not by the public interest but by interest groups or industries. As the spectacle of the conservative parties’ destruction of the Gillard government’s carbon price and the Coalition government’s abject failure on energy policy eloquently demonstrates, regulatory capture corrupts decision-making and exacerbates inequality by favouring those with influence and power over those without. As such it is fundamentally anti-democratic, and erodes standards of public accountability, something that was underlined early last year when Australia’s ranking on Transparency International’s corruption index fell once again, in large part because of “conflicts of interest in planning approvals; revolving doors; a culture of mateship; and inappropriate industry-lobbying in large-scale projects, such as mining”. Yet whatever we choose to call it, it is clear that when Resources Minister Matt Canavan posted on Facebook in 2017 that it had been “such an honour to represent the Australian mining sector over the past year”, he wasn’t confused nor had he forgotten the voters who elected him. He was simply stating a fact.
As I descend past the side of the bommie, clouds of fish shoot by, darting in and out of the coral. Some I recognise: the blue-green parrot fish with their smiling faces, the busy cleaner wrasse circling a cobalt-blue surgeonfish, the ornate pair of lionfish lurking in a cave; others I do not, such as the schools of tiny blue-and-green fish that shift above me or red pteropods that drift by in the current at the surface.
Yet despite the site’s thrilling plenitude, it is difficult to escape the fact this world of colour and life is thinner and less vibrant than it was the first time I dived on the Great Barrier Reef, two decades ago. Even then it was not pristine, of course: a century of agricultural run-off and exploitation had already cost it almost a quarter of its coral cover. But that damage paled into insignificance against the impact of the back-to-back bleaching events that struck the Reef in 2016 and 2017, wiping out almost half the coral and altering the physical structure of the Reef forever. Two years later, the legacy of that event is still visible: although there are many healthy corals they cannot obscure the algae-shrouded skeletons of dead coral that lie beneath them.
For many Australians, these bleaching events marked a turning point, bringing home not just the true cost of climate change but also the urgency of the problem. Yet the juxtaposition of the Reef and Carmichael mine also crystallised disquiet about the wisdom of opening new coalmines at a time when the effects of climate change were ever more obvious.
In fact, environmental and community groups had been fighting the project from the first, often against considerable odds and with few resources. In 2015 the community-based Mackay Conservation Group (MCG) took action against the project in the Federal Court, on the grounds that in approving it the then environment minister, Greg Hunt, had failed to take into account the potential for future emissions from the coal produced at the mine to adversely affect the Reef.
The MCG’s action was risky, not least because it could have had costs awarded against it. But it also had the potential to be profoundly important. The Environment Protection and Biodiversity Conservation Act 1999 (the EPBC Act) requires the minister to take into account “principles of ecologically sustainable development” when considering projects, though whether this should be interpreted broadly enough to embrace indirect impacts such as future emissions is unclear. A ruling that the project did have such an impact would bring into question not just Carmichael but also new coalmines in general.
In the end the court declined to rule on the question of emissions. But the case was not lost: in examining the evidence, the judge found Hunt had erred in his responsibilities under the EPBC Act by failing to consider advice about the effects of the project on two species of reptiles, the yakka skink and the ornamental snake, and ordered the approval be set aside.
The coal industry and its allies went into overdrive. Adani’s media team dismissed the finding as the result of “a technical legal error”, while Prime Minister Tony Abbott complained that “if the courts can be turned into a means of sabotaging projects … we have a real problem as a nation”. (With his usual jaw-dropping lack of irony, Abbott also ignored the fact it was his own minister at fault, as he declared that “we have to remain a nation that gives people a fair go if they play by the rules”.) Meanwhile, Attorney-General George Brandis announced the government would amend the EPBC Act to remove the right of third parties to appeal environmental approvals altogether, a move he claimed would protect the jobs of “tens of thousands of Australians” from “vigilante litigation” by “radical green activists”.
Although Hunt’s decision was soon reinstated, the legal battle over the mine’s environmental impact was not over. Another action had been unfolding in Queensland’s Land Court, where an organisation called Land Services of Coast and Country (LSCC) was seeking a judicial review of the state government’s approvals for the mine. Like the MCG’s action, this organisation’s case argued that the emissions created by the coal from the mine would damage the Great Barrier Reef because of their effect on the climate, but it also contended the project would have unacceptable impacts on the endangered black-throated finch, could adversely affect ground-water at nearby springs and – crucially as it turned out – that the economic assumptions underpinning the mine’s approvals were unreliable.
Despite the case revealing the scale of the mine’s potential impact on the springs and the finch, the court did not sustain LSCC’s objections, instead recommending the approvals be granted subject to further conditions designed to protect the finch. Perhaps more importantly, though, it did not uphold the objection based on the mine’s contribution to climate change either. By accepting the argument that Carmichael’s contribution to global warming should be understood without reference to wider implications, the court effectively endorsed one of the coal industry’s core arguments: that no one country can reduce emissions enough to solve the problem alone, hence no action need be taken. This tactic, of using the impossibility of doing everything as an excuse to do nothing, has proved remarkably successful. Yet when set against the real-world implications of a mine such as Carmichael, its intellectual dishonesty becomes inescapable.
Meanwhile, another battle was unfolding. The country around Carmichael is the traditional land of the Wangan and Jagalingou people. Their story, like that of too many Indigenous Australians, is one of wrenching pain and sadness: driven off their land by early settlers and miners, the Wangan and Jagalingou were later forced onto missions, many of them hundreds of kilometres away from their ancestral lands, and had families broken up through the policy of child removal. Yet theirs is also a story of strength and survival. Even when separated from their lands, many Wangan and Jagalingou have retained strong connections to country, and have fought to preserve traditional stories and knowledge.
In 2004 several families sought recognition of this connection by submitting a native title claim. An anvil-shaped area covering 30,277 square kilometres, the claim takes in Alpha, Clermont and the Carmichael mine site, and seeks the right to camp and hunt and fish, as well as practise traditional ceremonies and laws, maintain sacred sites and bury the dead.
Despite its promise, the Native Title Act is a deeply flawed creation. Although it creates a process by which Indigenous Australians may assert their rights over country, in a practical sense those rights are highly circumscribed. In instances where others – mining companies, for instance – take an interest in land or water covered by native title, the traditional owners have a right to negotiate a deal with the other party, the terms of which can be enshrined in an Indigenous Land Use Agreement (ILUA). Yet they do not have a right to refuse to negotiate or simply to reject proposals. If they do so – or indeed if the traditional owners cannot reach agreement on terms within six months – the other party can simply apply to the National Native Title Tribunal for a determination that they can proceed without consent.
The result is a profoundly unbalanced system that places traditional owners in a difficult and highly vulnerable position: choose to negotiate and they might win a few concessions; refuse to negotiate or hold out for a better deal and they run the risk of losing everything. As barrister Tony McAvoy, a Wangan and Jagalingou man and the first Indigenous Australian senior counsel, said in an interview last year, “The native title system … coerces Aboriginal people into an agreement. It’s going to happen anyway. If we don’t agree, the native title tribunal will let it go through, and we will lose our land and won’t be compensated either.”
The Wangan and Jagalingou were well aware of this when Adani approached them in 2011. The initial negotiations related to the first of the mining leases Adani required, and Adani went in hard, giving the seven negotiators appointed by the Wangan and Jagalingou just two weeks to accept what it said was its best offer, and advising that it would refer the matter to the tribunal if they did not. In response, the Wangan and Jagalingou sought a deal that would see Adani guarantee them jobs and business opportunities if the mine went ahead. Adani rejected their proposal and referred the matter to the tribunal.
In late 2013 a new round of negotiations began, this time in respect of two further mining leases and an ILUA relating to the land Adani required for its operations centre, power plant and airfield. Instead of the original negotiating team of seven there was now a team of just three: Patrick Malone, Irene Simpson and Adrian Burragubba. Once again the Wangan and Jagalingou opposed Adani’s plans, a position that was confirmed 12 months later, in October 2014, when 200 members of the claim group rejected the proposed ILUA.
Adani and its representatives had already been working behind the scenes to undermine the process and foster divisions within the community and the claim group by conducting side negotiations with members supportive of the project. But after the ILUA was rejected in 2014 this process coalesced into a clear strategy, as Adani negotiators sidelined Burragubba and began separate negotiations with Malone and Simpson.
This approach came to a head in June 2015, when a meeting of the claim group was interrupted by the arrival of buses carrying 150 people. As journalist Michael West said at the time, “It was an Adani ambush, and it must have cost a fortune: three days of food, accommodation and transport for 150 people.” With the room full of its supporters, Adani’s representatives began to push for a vote on a secret deal the company had made with Malone and Simpson.
Despite Adani’s efforts the proposal was rejected again: in West’s words, Adani was “shown the door”. But the victory of Burragubba and the others opposed to the deal was to be short-lived, for in April 2016 a group claiming to represent the Wangan and Jagalingou voted 294 to 1 to support the ILUA.
Exactly what happened at that April 2016 meeting remains highly contested. Those opposed to the mine insist it was illegally constituted and that many who attended were not eligible to vote. Yet there is no question the process illustrates the impossible situation facing Indigenous Australians who either oppose development on their land or seek meaningful compensation when it takes place. Similarly there is little doubt Adani worked hard to influence the process at multiple points, perhaps most visibly by stacking the June 2015 meeting.
Nor is the story over. In 2017 Burragubba and four others challenged the ILUA, arguing it should never have been registered. Although that challenge was dismissed in August last year, in December the matter was referred to the full bench of the Federal Court. In response Adani’s lawyers sought security costs of $160,000, an amount Federal Court Justice Alan Robertson described as “disproportionate and unpersuasive”. Meanwhile – in another example of the company’s preparedness to use its resources to silence those who oppose the project – Adani’s new lawyers, AJ & Co, have commenced proceedings against Burragubba personally, seeking $600,000 in costs.
Central to the Wangan and Jagalingou’s objection to Carmichael is the question of the impact on the nearby Doongmabulla Springs. Fed by more than 60 tributaries and covering more than 10 hectares, Doongmabulla is an area of exceptional ecological significance. One of the few permanent sources of water in the otherwise arid landscape, it is vital to the survival of many of the species that live nearby, a number of which are found nowhere else.
It is also a place of profound cultural significance to the Wangan and Jagalingou. The locus of creation in their cosmogony, its waters are the place from which their creator spirit, Mundunjudra, travelled through the land, giving shape to it and defining the system of totems and rituals that connect the traditional owners to their country.
Concerns about the Carmichael mine’s use of water and its potential effects on Doongmabulla have dogged the project from the first. Scientific evidence brought by the Land Services of Coast and Country case made clear that, despite the very real risk the mine posed to the springs, Adani had not done nearly enough to make sure the mine would not affect the area, a lapse the Land Court president described as “concerning”.
Yet it was really the Palaszczuk government’s April 2017 decision to exempt Adani from new rules regulating water use (a decision reached after extensive lobbying by Next Level) that thrust the question of the project’s use of water into the public eye. The decision, which effectively allowed Adani an unlimited water licence, was taken against a backdrop of continuing drought in central Queensland, and sparked widespread public outrage.
Conflict between coalminers and other water users is not new. Every tonne of coal produced requires approximately 250 litres of freshwater. Some of this is used to cool cutting surfaces and reduce the risk of fire (cutting a flammable material is a risky proposition). The rest is used to control dust, and in processing when the raw coal is ground up and mixed with water to make a kind of slurry that can be transported through pipes. And every litre of this water cannot be used elsewhere.
In the case of the Carmichael mine, most of the water will be drawn from the aquifers of the Galilee. These aquifers are part of the Great Artesian Basin, a vast reservoir of water that spreads from the tip of Cape York down through Queensland and northern New South Wales into South Australia. Underlying almost a quarter of Australia, the Basin extends up to 3 kilometres underground, and contains as much as 65,000 cubic kilometres of water. It is also crucial to the viability of communities and farms across the region.
Adani estimates the mine will use up to 12 billion litres of water a year, approximately 4 per cent of the water Queensland draws from the Great Artesian Basin annually. Yet while this amount is significant, it is unlikely to have much impact on the Basin as a whole: despite using 286 billion litres annually, 120 years of exploitation have only used approximately 0.1 per cent of the total water in the Basin.
These figures are less reassuring than they seem. The hydrology of the Great Artesian Basin is extremely complex, making it difficult to predict what effect water use will have on specific aquifers. Of the 300 spring complexes identified in the Galilee in 1900, only 36 per cent are still active, largely due to drawdown for agriculture, while in other areas water levels have fallen as much as 80 metres.
Even a fraction of this drop would have catastrophic effects for Doongmabulla, and for local communities and pastoral businesses.
Given these uncertainties, it seems reasonable to assume every aspect of Adani’s plans to manage groundwater has been scrutinised as carefully as possible. Yet this is not the case. Despite Greg Hunt declaring it was subject to “the strictest conditions in Australian history”, his approval did not depend upon any independent assessment of the mine’s possible impact on Doongmabulla. Instead it was contingent upon Adani carrying out further studies and modelling to demonstrate the potential effects. Adani is not obliged to make the results of these studies public, nor is the minister required to reassess them before they are implemented.
In the case of Doongmabulla, an incorrect assessment of the area’s hydrology would have catastrophic effects on the ecological communities the springs sustain, most of which would be lost forever should the water levels fall too far, even temporarily. Yet despite a “Myth Buster Fact Sheet” on Adani’s website that unequivocally asserts the springs will not be affected by the mine (“Below the Springs, is a 250–300 metre layer of thick claystone … inhibiting water moving from springs to the mine”), a 2017 study by RMIT engineering expert Matthew Currell found there was a “significant probability” Adani had misidentified the source of the aquifer feeding the springs, and that it was more likely than not the mine would drain the springs.
These are concerns Adani seems reluctant to address. When the Queensland government ordered the company to establish the source of the springs in June last year, the company submitted a draft plan that failed to do so. Likewise, an independent scientific assessment of Adani’s Groundwater Dependent Ecosystems Management Plan (GDMEP) by the CSIRO and Geoscience Australia, obtained by the ABC in December, found serious flaws in the plan, in particular its potential effects on Doongmabulla, and raised concerns about the use of “unverified” data. It also noted Adani still had not identified the source of the springs, despite repeated requests to do so. According to the ABC, the Queensland Department of Environment and Science has told Adani they will not look at any more versions of the plan until these concerns have been addressed, saying in a statement, “The GDEMP needs to identify the source aquifer of the Doongmabulla Spring Complex and mitigation measures to protect the springs.”
The uncertainties around the mine’s impact on Doongmabulla offer a disturbing glimpse of the weaknesses of our system of environmental approval and regulation. Voices within the environmental movement often argue that regulatory bodies are conflicted, and that the potential boost to state coffers from taxes, royalties and other income creates a logic that is difficult to resist when assessing projects. Whether or not this is correct, there is no question inadequate resourcing of regulatory bodies, coupled with the pressure to approve major projects, often sees the interests of vulnerable species and ecological communities subordinated to those of miners and developers.
Nowhere is this clearer than in the case of the southern black-throated finch. An attractive bird with a rufous belly, pinkish-brown back and a bluish-grey head with black markings, the finch feeds on native grass seeds, gathering in small flocks to forage on the ground or perching on the stems of grasses to pick the seeds.
Although the finch was once found from the bottom of Cape York to northern New South Wales, habitat loss as a result of agriculture and grazing, together with expanded urban development, has seen its range and population contract by close to 90 per cent in recent decades. Although a few scattered populations still exist near Townsville and Rockhampton, those that remain are mostly concentrated in the Galilee, with the most significant population concentrated in the Moray Downs, at the northern end of the Carmichael site, an area that would be irreversibly damaged should the mine go ahead.
To counter this problem, Adani proposed a system of offsets. A device often used when development conflicts with the habitat of threatened species, offsets are basically areas of alternative habitat. In theory they work on a like-for-like basis, substituting high-value habitat for high-value habitat. In practice they are a much more vexed proposition, especially when dealing with a species that, like the finch, is already known to be highly sensitive to disturbances of its habitat.
The details of the proposed offsets for the finch are contained in Adani’s Biodiversity Strategy and Management Plan. Yet a 2017 review conducted by scientists from the University of Queensland described Adani’s plan as “grossly inadequate”, and reserved particular criticism for its proposed offsets, disputing the company’s calculations of the amount of habitat that should be offset, the quality of the areas proposed as offsets and the timing of their rehabilitation, which was not required to begin until after mining operations had begun. This means the new habitat would not be available (and certainly not rehabilitated) until after the original habitat had been destroyed. Perhaps most importantly, the scientists also highlighted concerns that because the Moray Downs population is the largest known remaining population, it is likely to be a source population that sustains other, less robust populations elsewhere, meaning its loss is likely to have “severe ramifications for the entire region”.
This research highlights the scientific community’s growing consensus about the value – or lack of value – of offsets in general: not only does research suggest offset plans frequently rely upon questionable calculations, it shows offsets do little to counter the effects of development, and frequently push threatened species closer to extinction. Indeed in evidence to a Senate committee examining Australia’s extinction crisis in February this year, scientists revealed there is not a single recorded case in which offsets have prevented the decline of species affected by development. In other words the central mechanism in Adani’s plan to protect the finch does not work and has never worked.
The case of the finch also suggests we should be very sceptical about what it actually means when Adani claims it has “followed the legislation and conditions set in close consultation with the Federal and Queensland governments”, or when politicians and others declare projects like Carmichael to have been “rigorously assessed”.
Research by journalists Oliver Milman and Nick Evershed, published in Guardian Australia in 2015, revealed that of the 824 projects assessed under the EPBC Act since 2000, a mere 18 have been rejected. In the case of mining and resource projects the figures were even more startling: close to 99 per cent of all projects were approved. Likewise, research by the ABC’s Mark Willacy in 2016 showed that despite multiple instances of missing paperwork, inadequate information and evidence of disqualifying events, not a single one of more than 1000 applicants for “suitable operator” status under the Queensland government’s Environmental Protection Act had been rejected. Still, it would be difficult to find a more eloquent statement of the way regulatory systems privilege development over the environment than the revelation earlier this year that of the 775 development applications with the potential to affect the black-throated finch’s habitat lodged since 2000, only one was rejected due to unacceptable impacts on the finch.
By 2015, doubts about the viability of the mine were growing, at least partly due to Adani’s inability to find financial institutions willing to back the project. This process was already underway by the end of 2014, when the State Bank of India deal Campbell Newman had secured by offering to bankroll the Abbot Point railway had come unstuck amid claims of nepotism and concern about Adani’s high levels of debt. (As one source in India told Reuters, “The credit guys are not comfortable with the project.”) But the State Bank of India was not alone in its scepticism: by 2015 a rollcall of international banks and financial institutions that included HSBC, Barclays, Morgan Stanley, Citigroup, BNP Paribas and Société Générale had declared they would not support coal projects in the Galilee.
Back in Australia, environmental groups were also lobbying financial institutions to take a stand. Part of a global push to encourage major organisations to divest themselves of fossil fuel investments, the campaign was given impetus by the collapse of the global coal price in the middle of 2015. It was also driven by a recognition of the growing risks associated with investment in coal. The International Energy Agency’s forecasts suggest thermal coal exports will fall by more than 60 per cent over the next 20 years. Coupled with the rapidly declining cost of renewables, this creates the very real possibility that large coal projects will end up as stranded assets, a risk compounded by the rapid move away from coal-fired power in India and the hastening decommissioning of coal-fired power plants around the world.
In this context, the decisions of Australian banks to exit coal look more like enlightened self-interest than attacks of conscience, but irrespective of their reasoning, the divestment campaign succeeded. Starting with the Commonwealth Bank in August 2015, the four major banks withdrew their support for the project, simultaneously announcing changes to the ways they assessed projects that would make it increasingly difficult for coalmines to receive funding in the future.
Meanwhile alarm bells about Adani itself were ringing louder and louder. In India, Gautam Adani’s close relationship with Prime Minister Narendra Modi was coming under scrutiny, as was the company’s financial structure and level of indebtedness.
Back in Australia, this unease was intensified by concerns about the company’s environmental record. Some of the most significant of these related to the Abbot Point coal terminal, which was now being operated by Adani subsidiary Mundra Ports. Expanding the terminal to increase the amount of coal it could handle was a crucial element in Adani’s plans for Carmichael, and in the opening up of the Galilee more generally. In December 2013, Greg Hunt approved plans to expand the coal port at Abbot Point, a project that would involve widespread destruction of coral and sea grass, and result in millions of cubic metres of dredge spoil being dumped at sea, smothering Reef ecosystems. After outcry from scientists, the Queensland government announced the spoil would not be dumped at sea or in wetlands adjacent to the terminal, but further inland. Nonetheless Abbot Point was soon back in the news, this time because of allegations Mundra had released water laden with coal dust into the Reef in the aftermath of Cyclone Debbie, deliberately exceeding the permissible concentrations by 800 per cent.
Concerns about Adani’s corporate culture were also growing. In 2015 it was revealed that despite a Queensland government request to disclose information about whether any of its executive officers had been involved in breaches of environmental laws, Adani Australia had failed to disclose that its CEO, Jeyakumar Janakaraj, had been in charge of a copper mine in Zambia that released toxic chemicals into a major river, an incident that led to the company pleading guilty to charges of not only polluting the river but also wilfully failing to report the incident. Investigations by the ABC also raised allegations the mine had poisoned crops and caused serious illnesses, respiratory complaints and eye problems among the local population. Perhaps predictably the Commonwealth government declined to take any action, declaring the failure to disclose Janakaraj’s involvement in the Zambian operation had been a mistake, and did not go to the question of whether Adani’s application should have been approved.
Worse was to come. In 2017, the ABC’s Four Corners aired an investigation into the company that laid bare a culture of corporate and environmental malfeasance that included the wholesale destruction of protected mangroves and waterways during the development of a port in Gujarat. While visiting the region, ABC reporters were detained by police and questioned for almost five hours. As the ABC’s Stephen Long explained, “The senior policeman kept going outside and talking to someone on his mobile, and whenever he returned the questioning, the hostility, would ramp up. It was obvious they knew why we were there, but everybody was avoiding the ‘A’ word, ‘Adani’. They told us that if we stayed there would be officers from three Indian intelligence agencies coming to visit us the next day, plus we’d have an entourage of crime squad detectives and local police wherever we went.”
Four Corners also detailed allegations of money laundering, tax evasion and bribery in India, exposing the complex web of shell companies and tax havens Adani uses to minimise its tax, and suggesting the full details of these arrangements had not been revealed to Australian regulators. And it repeated the doubts about Carmichael’s financial viability. As nuclear physicist and former head of India’s Ministry of Power Dr E.A.S. Sarma told the ABC, it added up to a “risky proposition” for a government committed to investing more than a billion dollars in the project. “You are actually shifting taxpayers’ money into something that is not viable.”
Annastacia Palaszczuk continued to defend the project in the immediate aftermath of the Four Corners program, but by the time she announced the election three weeks later it was clear the project was a source of deep division within the Queensland Labor Party. Despite criticising the Newman government’s use of public money to support the project during the 2015 election, in government Palaszczuk had consistently supported the mine, talking up its economic benefits and offering concessions such as critical infrastructure status, unlimited access to groundwater and deferment of royalties. Most importantly, though, her government had supported NAIF’s proposed loan of $1 billion to finance the rail link to Abbot Point. NAIF’s loan was now critical to the project’s viability since all the banks had refused to provide finance.
Yet as the state election campaign got underway, it was obvious Adani had become a liability for Labor. GetUp, #StopAdani, the Australian Conservation Foundation, the Australian Youth Climate Coalition and other organisations mobilised thousands of supporters to call electors in vulnerable seats and disrupt campaign events. Polling showed sizeable swings to the Greens in a number of inner-city seats, including that of Labor Left leader and Deputy Premier Jackie Trad. Already under pressure because of Cameron Milner’s links with Adani, Palaszczuk was further embarrassed by revelations that her then partner, Shaun Drabsch, had been involved in preparing Adani’s loan application while he was working for PwC. Palaszczuk went on the attack, emphasising she had sought the advice of Queensland’s Integrity Commissioner as soon as the conflict became apparent and vehemently denying the suggestion the two had ever discussed the matter, saying Drabsch’s work had been commercial-in-confidence. But to remove any appearance of conflict she also declared her government would now veto the loan.
The tensions in the Queensland Labor Party over the mine are no less acute at a federal level. Under pressure from anti-coal activists and Greens in its inner-city seats, but wary of electoral blowback in Queensland and from unions such as the AWU and CFMEU, Labor has been evasive and often contradictory regarding its position on Carmichael. Despite going so far as to seek private briefings from scientists and environmental groups, Bill Shorten has been unprepared to unequivocally reject the mine; instead he has taken to saying it has to stack up “environmentally and economically”. And while declaring himself personally sceptical of the project, he has also spoken about there being “a role for coal in Australia” and signalled continued Labor support for mining jobs in Queensland.
Shorten’s refusal to articulate a clear position on the mine is at least partly an attempt to stave off attacks from the project’s backers in the conservative media, but it also speaks to a much deeper conflict within Labor over Carmichael and coalmining in general. This conflict spilled into the open in February, when the CFMEU signalled it would campaign against Labor candidates who did not endorse the project. But Shorten’s prevarication also underlines just how toxic the project has become, not just in the left-leaning enclaves of the inner city but throughout the country. As anybody who attended the school strikes for climate will know, for an entire generation the name “Adani” is now synonymous with climate change, a baleful symbol of our political leaders’ capitulation to the fossil fuel industry.
Although a fortnight has passed since the floodwaters receded, on the verges of Townsville’s riverside suburbs great piles of ruined furniture, mattresses and other household goods still stand waiting to be cleared. Often they are, as they appear, the sum total of their owner’s physical possessions: one afternoon I speak to an insurance assessor – a huge, muscled figure with tattoos up both arms – whose voice breaks when he tries to describe how much people have lost. “You wouldn’t believe the situations I’ve walked into this week,” he tells me. A woman in a shop grows emotional as well, explaining that while she was okay, her two workmates have lost everything. “I didn’t meet a single person who was insured,” says another man, before showing me pictures of mattresses on his phone, describing the difficulty of moving them once they are wet. “They weigh 150 kilos, and when you pick them up sewage and floodwater slops out of them and gets all over you.”
The flood, which killed three, inundated thousands of homes and drowned 300,000 cattle and countless native animals, was the consequence of what is being described as a one-in-a-thousand-year rain event. But it was also only the latest in the string of disasters that ravaged Australia over the summer months, a wave of destruction that began with fires in rainforest outside Cairns, and also saw temperatures climbing close to 50 degrees in southern states, mass fish deaths in the Murray–Darling and weeks of bushfires in Tasmania.
The causes of these events are complex, but there is no question they are part of a pattern of extreme weather driven by a warming climate. Nor should they come as a surprise: we have had decades of warning about the need for urgent and decisive action on emissions, and of the costs of failing to act. Nowhere is this laid out more starkly than in the Intergovernmental Panel on Climate Change’s “Special Report on Global Warming of 1.5ºC” delivered in October last year. The report makes it brutally clear that without significant reductions in emissions over the next 10 years we face the loss of 99 per cent of all corals, mass extinctions of insects, fish, birds and other animals, widespread food shortages, the displacement of hundreds of millions of people by sea-level rise and sharp increases in the incidence and severity of drought, fires, cyclones and other natural disasters.
This reality is difficult to accept; little wonder so many of us resist its implications. Yet denial takes many forms. There is the shameless intellectual dishonesty of the hard right, with its junk science and surrender to corporate interests. This is Tony Abbott declaring coal is “good for humanity” or Scott Morrison bringing a lump of coal into parliament. It is the killing of the carbon price and Environment Minister Melissa Price dismissing the IPCC’s findings that it is necessary to get out of coal by 2050 as “drawing a very long bow”.
Then there are the many variations the rest of us inhabit, often simultaneously: the ways of thinking that allow us to acknowledge the reality of what is going on but never quite the scale of it, or to acknowledge the scale of it but only for a minute or an hour or a day before we shut it out again because it is inconvenient, exhausting or just too horrifying to contemplate.
But there is another form of denial as well, one more insidious than the full-blown denialism of the far right. This is the kind we see when politicians accept the science of climate change but refuse to grapple with its implications. It is the Gillard government introducing a carbon tax while simultaneously presiding over the largest ever expansion in Australia’s coal export industry. It is governments in South Australia investing in renewable energy while supporting oil exploration in the Great Australian Bight. It is Malcolm Turnbull and Josh Frydenberg giving half a billion dollars of public money to a little-known reef charity while championing an energy policy that would do nothing to reduce emissions. It is senior Labor figures refusing to rule out new coalmines when they know we have a decade at most to bring emissions down. It is, in short, the fantasy there is room for delay, or that we can have action on climate change while still indulging the advocates of fossil fuels.
The contradiction of this position is no longer sustainable. To have any hope of holding warming to 1.5 degrees we must reduce net emissions to zero by 2050. Yet, like global temperatures, global emissions keep rising. After briefly stabilising between 2014 and 2016, they increased by 1.6 per cent in 2017, and 2.7 per cent in 2018. It is expected they will rise again this year. Much of this upward trend is driven by increased coal consumption. If emissions continue on this path, we can expect temperature rises of 4 degrees or more well before the end of the century.
The consequences of such an outcome are almost unthinkable, although the end of the Permian offers a chilling preview. Even the most conservative models show large parts of the planet will become uninhabitable. Ecosystems around the world will collapse, wiping out most species of animals. Acidification and anoxia will devastate the oceans. Rising sea levels will destroy coastal areas, while heat and famine and cascading climate disasters will kill hundreds of millions. These are not outside possibilities. They are the inescapable and near-term outcomes of failing to reduce emissions. In the face of this reality, opening new coalmines is like locking our children in a burning house and throwing away the key.
As for Carmichael itself, the project may be down but it is not out. In late 2017 Adani announced it would now proceed on a much smaller scale, producing a mere 25 million tonnes of coal instead of the 60 million originally envisaged. Although the expansion of Abbot Point and rail link remained part of this new, slimmed-down version of the project, in August last year Adani then quietly shelved the plan to expand Abbot Point, and in September announced that the rail link would also be replaced with a much shorter line that took advantage of existing infrastructure owned by Aurizon. Finally, in November last year, Adani announced it would finance the project with its own money, followed in December by a statement that it was beginning work – while sharing pictures of what it claimed was heavy earth-moving equipment gathered ready to begin construction.
What this means is difficult to know. Economist John Quiggin, who has monitored the project since the outset, is sceptical, seeing little in Adani’s publicised activities that suggests the mine is really underway. Nor is there any sign of the promised jobs boom. Simultaneously though, the company seems to be taking a more aggressive line with its opponents, a shift made clear by a strategy document prepared by its lawyers, AJ & Co, which was leaked to the ABC in February. The document stated AJ & Co would work as a “trained attack dog” – using lawsuits and social media to pressure decision-makers, and private investigators and police to target activists. Adani refused to disavow the approach, saying instead they “won’t apologise for pursuing our legal rights”.
It is possible this shift in strategy is related to the changing attitude of the Queensland government, which seems to be looking for an excuse to abandon its support for the project. In December, controversy over the fate of the black-throated finch saw the state government commission a report from University of Melbourne ecologist Brendan Wintle, while in February Adani’s attempts to pre-emptively discredit the report earned it a rebuke from Deputy Premier Jackie Trad, who accused the company of choosing to run a political campaign instead of engaging with the process. Only days later, Queensland’s resources investment commissioner, former coal executive Caoilin Chestnutt, reportedly told a conference in India the Adani approvals process is “an absolute mess” and that the company would need to go back to the drawing board, although the Queensland government quickly distanced itself from her comments.
Federal Labor, however, remains studiously ambiguous about its attitude to the project: despite Shorten’s expressions of scepticism, shadow treasurer Chris Bowen recently said a future Labor government would not open itself up to claims of sovereign risk by blocking the mine. Bowen also pointed to the high levels of unemployment in the region and argued the reduced scale of the project means it no longer poses the environmental threat it once did.
Perhaps such prevarication helps explain why Adani has not yet abandoned the project. Or maybe having invested so much it is unwilling to just let it die. Or perhaps it really does have one eye on the possibility it might be able to claim compensation if a future government revokes its approval. Certainly the company’s decision to announce that the project has commenced looks like a strategy to raise the stakes for Labor; blocking a project that is already underway is a much more difficult proposition than withdrawing approval for one that has yet to begin.
Meanwhile other developments are altering the landscape almost daily. In January the NSW Land and Environment Court rejected an application to build a coalmine at Rocky Hill, north of Newcastle, on the grounds it would contribute to climate change. In February, Glencore announced it would cap its coal production at current levels, effectively ruling out the development of new mines. That same week, China placed restrictions on imports of Australian coal, leading to price falls. And in March the Reserve Bank of Australia’s deputy governor, Guy Debelle, made an important intervention into the public policy debate, saying financial stability was “better served by an orderly transition to a low-carbon economy than an abrupt disorderly transition”.
The economics of energy are also changing rapidly. Almost half of new energy supply worldwide is from renewable sources, and as supply increases, prices are dropping so rapidly that the International Renewable Energy Agency estimates that by 2020 renewables will be cheaper than fossil fuels in every major region of the world. Investment in new coal power in India is also falling, where new solar power can now be delivered for $40 per megawatt hour as opposed to $60–70 per megawatt hour for new coal power. And as the penetration of renewables grows, prices will continue to fall, a process many analysts believe will lead to a rapid decline in the value of fossil fuel investments of all kinds.
Although they should not distract from the scale and urgency of the task ahead, these developments are part of a larger transformation of the debate. Only a decade ago the notion the world needed to transition away from coal was a fringe idea, seldom heard outside environmental circles; now it is widely accepted as an inevitability. But these developments also underscore one of the key conundrums facing those who seek action on climate change. Those in power are not going to fix the problem: even when they are not working actively to frustrate action, the institutional inertia and influence of the fossil fuel industry make change incredibly difficult. Left to its own devices conventional politics would already have delivered not just Carmichael but also mass exploitation of the Galilee; the only reason that has not happened is because activists, community groups and others have worked tirelessly to prevent it.
Simultaneously, though, the systemic change needed to transition from coal will only be delivered through the mechanisms of representative politics. Governments will only do better when they are compelled to. There is no one path to this goal, although as the shift to renewables accelerates, the economic logic will become more and more difficult to resist. Nor will it be easy, and time is desperately short. But as the battle over Carmichael shows, it can be done.
James Bradley is an author and a critic. His books include the novels Wrack, The Resurrectionist and Clade.