China has lots of BROWN Coal

Posted to Bolt Blog (31-July-2008)

In this article : Gas on about that clean coal - and Rudd’s mad plan

For those that still think its about the 'environment' or the 'science' debate...

China has lots of Brown Coal (lots of countries do), Australia has lots of Black coal (most countries don't). In a mild ETS environment (even it you are just thinking about it) Black coal has a comparative advantage when making large capital investments with low, but long term, returns. The risk rating to your capital is higher.

Once you build a power station to use black coal you can't just start using brown coal, so you lock in exports for 30-50 years.

ETS is about 30-50 years of black coal exports into rapidly emerging markets and a local massively public funded investment in co2 technology that will assist in maintaining existing markets.

This is why the 'science' arguments won't cut through on either side of politics. Do you really think Rudd would be doing this for the greenies that already vote labor by default? Count the number of ex-labor luvvies on the boards of coal companies....where's Kev's money invested?

Next walk through what happens if Australia doesn't do the ETS. Europeans will do their own ETS thing and this means less coal exports, China will use their own brown coal, no/less market for our black coal. I wonder if this the economic cost that Garnaut is talking about?