Treasury Dodges Coal Price Questions

Treasury officials dodge basic questions about Australian power station coal prices while claiming they “monitor” them for inflation forecasts. Despite promising to get back to me on notice, the officials refused to provide how much coal for generating electricity costs.

Australian coal prices for our power stations remain stable under long-term contracts, yet Treasury keeps pushing the narrative of high international prices to justify soaring electricity costs. Why hide the real numbers? Because cheap domestic coal exposes the true cost of the renewable energy transition to Australian families.

Time for transparency, Australian families deserve to know the real cost of their electricity and it’s not because of Ukraine.

Transcript

Senator ROBERTS: This is for the Treasury, on coal pricing. The Treasurer said in March, regarding Australian power station coal prices, that thermal coal burned in power stations in Australia was ‘more or less tracking’, according to Treasury’s December forecast, to be down about a third from a year ago. Do you track the price of thermal coal burned in power stations in Australia?

Mr Yeaman: We look at overall market movements in coal prices both for export and for generation, yes, as part of our CPI forecast.

Senator ROBERTS: How do you get that information on thermal coal prices in Australia for domestic use?

Dr Heath: In tracking coal prices on a regular basis, the most publicly available coal prices tend to be shipped coal. So if you’re looking—

Senator ROBERTS: Exported coal?

Dr Heath: Exported coal—that’s what is publicly available. The arrangements that individual coal-fired power plants have to access their coal means that the prices they pay could be quite different to those public prices. That’s not publicly available information, so we would have to basically go directly to the coal-fired power stations to find that information.

Senator ROBERTS: I understand the local price is much lower because they’re locked into long-term contracts. So it’s a vague process. When you’re talking about power stations, is it only power stations that buy their coal or is it also the power stations that are at the mine mouth—where it just goes straight from the mine into the power station?

Dr Heath: I think that’s getting to a level of detail that I don’t have.

Senator ROBERTS: Could you take that on notice, please?

Dr Heath: We can take that on notice, but I’m not sure—

Senator ROBERTS: I’d like to know how you get that price—or, if you don’t get that price, that’s fine.

Mr Yeaman: I am aware that we have in the past. Our colleagues at the department of climate change and also the department of industry, along with our colleagues at the Australian Energy Market Operator, look at prices by facility, and I think that does include those that get coal directly from the mine.

Senator ROBERTS: So you get that information from those other agencies?

Mr Yeaman: I’m not sure how systematised that is, but I’m aware we have in the past drawn information from those sources.

Senator ROBERTS: What’s the latest figure you have for the price of thermal coal burned in Australian power stations?

Mr Yeaman: If it’s that specific a question, I’ll take it on notice, if that’s okay.

Senator ROBERTS: Thank you. Are you aware that the CSIRO uses a coal price of $11.30 a gigajoule in its GenCost studies to say that wind and solar are cheaper than coal?

Mr Yeaman: We generally look at the GenCost report, but, for our purposes, we don’t tend to go down to that level of detail around their assumptions.

Senator ROBERTS: So you’re not aware that CSIRO uses the coal price of $11.30 a gigajoule in GenCost?

Mr Yeaman: I haven’t been aware of that and I’m not sure that my colleagues would be.

Senator ROBERTS: Okay, I can accept that. Are you able to provide the aggregate figures for coal prices over the last five years, please?

Mr Yeaman: We can certainly have a look and see what we can provide.