T4 Approval is Now, or Never

Over the next two days, three Planning Commissioners visit our town to make a decision about whether another coal terminal should be approved for Newcastle.

In what will be the largest public hearing on a planning decision ever staged in New South Wales, the Commissioners will hear the evidence and testimony of more than 130 speakers, the vast majority of whom will speak against the proposal.

The Planning Assessment Commission (or PAC) public hearing will be another powerful demonstration of the community opposition that has accosted T4, ever since it was dreamed up at the height of a coal boom that has long since given way to an oversupplied market. It is, after all, a project that the community has never wanted, and even its proponent Port Waratah Coal Services (PWCS) says is not needed.

And still, the coal loader that nobody wants lurches its sorry way towards this next stage of the state government assessment. PWCS justify their continuing pursuit of T4 approval as “planning for future opportunity”. Certainly, PWCS are thinking about opportunities, but not in the way that this slogan implies. It is only a matter of time before community outrage, economics and common sense strip this proposal of its last remaining merits. T4 will quite literally be approved now, or never.

First, there are the improvements in science of air quality. T4 is guaranteed to worsen particulate pollution in Newcastle, where already World Health Organisation recommended levels are frequently breached.

Every indication is that the particle pollution in our region is already damaging our health. A University of Newcastle study found that workers at the T3 terminal were three times more likely to be diagnosed with cancer than the general population while in Singleton, a medical study on school students found 1 in 6 had diminished lung function.

In response, the EPA has initiated the Lower Hunter Particle Characterisation Study, which will sample and assess fine particulate matter in the Lower Hunter and around the Newcastle Port and report the findings in mid-2015. With T4 to add 363 tonnes of small particle matter into the air each year, PWCS is certainly keen to see T4 approved before this study, and the community outrage that is sure to follow, is released.  

Second, NSW Planning Minister Pru Goward has flagged the introduction of independent economic analysis for new proposals. This analysis will test the often suspect economic modelling of projects like T4, to identify if a project has genuine economic merit. If T4 was subjected to this, the results would not be favourable.

The global demand for coal is flat-lining at best. Countries everywhere are putting forward aggressive methods to cut carbon pollution. China is banning coal fired power plants in 6 key districts by 2020 while the US is slashing coal power plant emissions by 30% on 2005 levels. Across the EU there is a mix of long term and emerging carbon trading schemes and incentives helping switch to clean energy options.

Changes in demand has seen coal prices at an all-time low – Australian thermal coal prices have sunk below $70 per tonne, their lowest since 2009. In China, coal prices have dropped 15 per cent since 2013. The falling coal price and strong Australian dollar has seen hundreds of jobs cut from mines across the Hunter and further cuts can’t be ruled out. No one is predicting a v-shaped recovery. The economics of T4 don’t stack up, and look even less feasible in the longer term.    

Third, the Port of Newcastle has a new owner, and with this comes new ideas. The intentions of the investment consortium remain to be seen. It is encouraging to see that the Port of Newcastle’s vision includes to ‘facilitate continued growth and development of existing and new trades in a sustainable manner’. This could potentially see the use of the port diversify into a range of other trades, like shipping containers or commercial cargo.

The risk to the PWCS business model are evident, and rushing to lock up the land for coal before another option gets put on the table is, in the most cynical of ways, ‘planning for future opportunity’.   

Over the next two days, PWCS will stress to the Planning Commissioners the urgency of a rapid approval, but only because the viability of this project is just as quickly becoming all the more tenuous.

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