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A just transition
for Queensland
November 2015
Published online by the Queensland Conservation Council in partnership with 350.org on Wednesday the
18th of November 2015 in Brisbane, Queensland.
Report Author: Ahri Tallon
A very big and special thank you goes to the Coal Action Network Aotearoa for publishing their pioneering
‘Jobs After Coal’ report upon which this report has been adapted. The New Zealand report was originally
published May 2014 and was then updated April 2015. Some parts of this report are from the New Zealand
report but have had additional information added. Written by Cindy Baxter, Jenny Campbell, Rachel Eyre,
Zella Downing, Jeanette Fitzsimons, Kristin Gillies, Tim Jones and Rosemary Penwarden (Cindy Baxter &
Zella Downing, 2014).
With thanks for input and review to:
Kirsten Macey, Shanather Wong, Kirsty Workman, John Ingram, Drew Hutton, Sean Kelly, Nigel Pratt, Rocky
Henry, Zane Alcorn, Patricia Julien, Nichola Hungerford, Sabrina Chakori, Scarlett Squire, Amanda Cahill, Ian
Daniels, Ellie Smith, Ellen Roberts, Christine Carlisle, Moira Williams, Gemma Plesman, Louise Mattiesson,
Abraham O’Neil, Daniel Musil, David Kerin, Jessica Miller, Nichola Hungerford and Rod Campbell.
Design by Sharon France of Looking Glass Press Pty Ltd.
JOBS AFTER COAL: A Just Transition for Queensland  |  i
Contents
Foreword	iii
Executive summary	 iv
Key recommendations for the State Government of Queensland	 vi
1.	 Coal’s current role in the Queensland economy	 1
Coal in the Queensland economy	 1
Revenue and economic activity generated by the coal Industry	 4
Coal industry jobs and their locations	 4
Summary	5
2.	 The drivers of change in the coal industry	 6
Drivers of change 	 6
The international coal price	 7
International mining companies	 10
The outlook for coal prices	 11
The carbon bubble	 12
Summary	14
3.	 Assessing some of the economic opportunities in mining regions	 15
Introduction	15
Agriculture and aquaculture	 16
Tourism and recreational fishing	 17
Higher education	 18
Bio-industrial products	 18
Renewable energy	 20
4.	 Community transitions: Global case studies	 22
La Trobe Valley	 23
Banwen	23
Orkney	23
Nord-Pas De Calais	 24
Appalachia (Kentucky)	 24
5.	 A just transition for coal mining communities policy recommendations	 25
Recommendations	27
Conclusion	32
References	33
ii  |  JOBS AFTER COAL: A Just Transition for Queensland
Bowen Basin coal mine and surrounding area
JOBS AFTER COAL: A Just Transition for Queensland  |  iii
Foreword
The coal industry’s impact on the state of Queensland has had its
peak and is now in decline. This makes right now the most important
time to be thinking about not just stopping the industry’s destruction
of prime agricultural land but also how we build the alternatives for
regions where coal has become so economically dominant.
There are so many opportunities for Queensland to move forward.
We have a growing population, diverse people and cultures, abundant
natural resources that have the potential to be used sustainably and
we are so close to the new epicentre of change in the world in Asia. 
One finds it hard to imagine how the many social and economic opportunities our state has available
to us can be ignored; how some leaders can still be so fixed in their intent to indefinitely expand the
coal mining industry when it is so clear the people of Queensland, the people of Australia and the world
wants to move forward.
This report is about the people of Queensland taking the initiative to communicate a positive new vision
of what our future economy and the journey to arrive there can look like. It is the beginning of a new
chapter in the conversation about coal that has been getting closer and closer to being opened as more
people realise the devastating impacts the industry is having. 
Most of all this report is about justice, not just for the planet, but for workers and citizens who have done
nothing wrong to work in the coal industry. It is about justice for workers who have been supporting our
economy, supporting our towns, our clubs and being part of our community. Finally, it is about justice for
the families in mining communities who deserve the support to help them plan their future beyond coal.
It is the government and it is the mining corporations that have allowed these communities to be placed
in an increasingly risky situation. However it is the responsibility of all of us to help them out of it and it
is now time to take that responsibility.
Drew Hutton
President of the Lock the Gate Alliance
iv  |  JOBS AFTER COAL: A Just Transition for Queensland
Executive summary
This report is calling for a Just Transition for coal communities in Queensland. The term is not well known in
common Australian political rhetoric. The ‘Just Transition’ term in this report is defined as a transition that
supports environmental policies with a fair distribution of the costs and benefits across the economy, and
that support the creation of opportunities for active engagement by those affected to determine the future
wellbeing of themselves and their families.
There is substantial international literature on the concept of a Just Transition. Reports by and for Australian,
Canadian and South African unions are just a sample of the literature diversity. Many organisations, by way
of example, the Organisation for Economic Development and Cooperation, the United Nations Environment
Program, the International Labour Organisation, the United Nations Framework Convention on Climate Change
and the World Wildlife Fund have produced literature on the matter.
All over the world, where communities have been largely dependent on a single, unsustainable industry they have,
throughout history, been forced to transition. Sometimes this is sudden, unplanned and involves considerable pain.
Most of which is felt by people working in those industries. This, unfortunately, has been the experience so far in
Central Queensland with numerous mining companies cutting costs and forcing redundancies that have caused
families to leave the region. The volatility of the Queensland coal industry has not been managed well by our either
colluding or timid state governments, depending on which party is in power.
Around the world there are stories we can look towards to find inspiration. Some communities, have reinvented
themselves, creating new industries and jobs, minimising the impacts on local people and establishing stronger
local economies. We discuss some case studies in the report of communities which have achieved some
impressive results. Inspiration can be found in the U.K and South African movements to create One Million
Climate Jobs (Jobs, 2015). Trade Unions have united with environmental organisations, academics and other
civil society groups to write a blueprint for the creation and financing of 1 million low carbon long-term jobs in
each country. Some of these initiatives include jobs in public transport, in energy and in housing and jobs to
localise and secure food supply and protect water resources (Change, 2010).
The market is telling us that coal is an energy source in decline. Renewable energy investment is skyrocketing,
air pollution controls are being stepped up around the globe and countries are preparing for much stronger
action on climate change. As a major carbon exporting country, Australia is in serious economic risk of being
caught in the midst of a rapidly hastening global energy transition. Australia must develop energy and climate
strategies that are more in tune with international developments and capture the economic opportunities to
transition away from fossil fuels and towards renewable energy. To do this we need strong leadership from
the business sector, our communities and, because of the speed and resources that will be required in this
transition, our governments.
JOBS AFTER COAL: A Just Transition for Queensland  |  v
The Queensland government is under pressure from mining corporations and other stakeholders to keep the
coal industry going strong. Faced with the challenge of creating an economic vision beyond coal, our political
leaders have chosen for too long to capitulate to this pressure. The coal industry is in denial about its terminal
decline. The question community members are left to ponder is if the industry knew its days were counted,
would it still try and squeeze as much support out of the government as possible? To try to make as many
subsidised profits as it can before throwing in the towel? We can’t wait and risk the livelihoods of citizens
in coal communities to find out. The alternative for the people of Queensland and the Government is to
admit that the decline is terminal and stop delaying the re-orientation of policy and the economy to support
sustainable industries.
Challenges faced by the different mining industry towns are quite different from one another. As such, the
planning of a just transition requires a diverse and adaptative strategic approach. For example, the challenges
the mining industry towns of Mackay and Rockhampton are facing are substantially different than the ones
the specifically mining operation towns of Moranbah and Blackwater are facing. Different regions with
different levels of economic dependency on coal will require unique transitionary solutions and strategies.
These different approaches needed are best understood by and will require leadership from the local
community to have the best chances of success.
The economic and geographical difference between thermal and coking coal operations is another significant
complexity. Often both coal types will be referred to as one homogenous industry by the media and politicians.
This misguided referencing makes having a discussion about the different futures for each industry
difficult. Coking coal has a substantially different outlook to thermal coal and needs to be discussed and
considered separately. Policy supporting a just transition needs to carefully consider their uniqueness and the
implications this has for planning support, resources and initiatives in different coal regions where each type
of coal has a different level of operational and economic intensity.
The political conversation about a Just Transition has only just started to emerge. Rumblings and whispers
of the actions and policies necessary within the environment and labour movements have been building
momentum. Policies are being discussed and cooperatives are being launched throughout Australia’s coal
communities. Significantly, this issue is building important relationships between environment groups and
labour unions that have complimentary objectives within the Just Transition framework. Their collaborations
are building a stronger and more cooperative civil society and strengthening the fabric of our democracy. It is
hoped that this report will help contribute to this momentum so that some tangible and clear actions are seen
in the very near future.
vi  |  JOBS AFTER COAL: A Just Transition for Queensland
Key recommendations for the
State Government of Queensland
1	 Establishing a unit within the State Government to support coal mining regions
to transition to new economies
The unit would:
•	 Work on the ground in coal mining communities to bring government expertise into regional
entities.
•	 Analyse barriers to the creation of competitive advantages for alternative sustainable industries.
•	 Identify actions the State Government can take to support sustainable industries.
•	 Provide research funding to that prioritises low carbon technologies and industry sectors with
increased triple bottom line sustainability potential.
2	 Support community leadership in diversifying local economies through the
establishment of democratic regional entities that:
•	 Lead in the development of their communities’ transition strategies.
•	 Researching the transition opportunities and pathways for the community.
•	 Planning and initiating re-training programs for workers from affected industries.
•	 Facilitate support programs for new businesses, cooperatives and social enterprises based on
the needs and strategies of communities.
•	 To take stock of the existing resources, skills, and successful businesses, on which a new
future can be built.
•	 Run an analysis of the social, environmental, and economic needs of the community.
•	 Establish economic diversification projects, including value-added local production, worker
controlled co-operative enterprises, and new community-based enterprises.
•	 Work in collaboration with regional councils and economic development organisations.
3	 Support researching and communicating how the just transition can take place
•	 Providing regular academic standard situational analysis of the global energy markets shifts to
keep the public informed about energy market trajectories.
•	 Support regional entities to research the number of jobs that are dependent on coal, the skills
of those employed, the level of local, national, and global long- and short-term risk to local
mining operations, the transferability of jobs to other industries, local opportunities for new
enterprises and their needs, and the local educational and training needs and resources.
•	 Researching how the transition scenarios could differ depending on the level and relativity of
thermal and coking coal industries across coal mining communities.
JOBS AFTER COAL: A Just Transition for Queensland  |  vii
4	 Convene a just transitions state economic summit to identify socially and
environmentally sustainable economic opportunities in mining communities
•	 Develop a plan to grow competitive advantage across industries that have potential for
sustainability and growth in regional mining communities.
•	 Organise a State Economic Summit to assess existing industry clusters; identify the potential
of new and emerging industries; consider their competitiveness and key capabilities; and
identify barriers to increasing competitive advantage.
5	 Provide social protection of workers, their families, and incomes
•	 Create individual mine employment transition plans in cooperation with mining companies and
local communities ready for when mines cease operating.
•	 Penalising mining companies that do not give adequate notice of their closure or restructuring.
•	 Subsidising workers at a full living income level for a maximum of four years who do not have
adequate employment available to them at the time of redundancy to undertake training for
careers that support the establishment of the new economy in their community.
6	 Supporting Unions to play leadership roles in social dialogues and to lead worker
engagement
•	 Support and finance Unions to play facilitating roles in community transitions.
•	 Engage Unions to:
-- Provide career planning and advice.
-- Negotiate preferential hiring for displaced workers in the new, alternative emerging
industries.
-- Lead the establishment of work controlled cooperatives.
7	 Provide training opportunities for coal workers and communities
•	 Mandating coal mining companies to fund education and training for their workers that give
them skills for other industries.
•	 Funding training programs to assist retrenched workers from the coal industry to attain
continued retraining and re-education.
viii  |  JOBS AFTER COAL: A Just Transition for Queensland
8	 Mandate adequate security deposits and progressive signoff for best practice mine
site rehabilitation
•	 Bringing mine site rehabilitation standards in Queensland to global best practice.
•	 Mandate that mine sales are not made to companies without adequate capital to properly
rehabilitate the mine site.
•	 Increasing mining security deposits to ensure that the full cost of third party mine site
rehabilitation is progressively implemented and signed off by governments throughout the life
of the mine.
•	 Ban the sale of mines where rehabilitation responsibilities are not complete or behind
schedule.
•	 Support the nationally coordinated implementation of the AusIMM Abandoned Mines policy
statement that includes the actions described above and more detailed policy changes.
9	 Remove all subsidies and tax payer funded support to coal mining
•	 Review and remove all hidden subsidies to the coal industry within the state government.
10	Sound investment and resource revenue management
•	 Commission an economic assessment of the possible economic mechanisms and changes to
existing policies that could fund the above measures to the extent that will be necessary.
•	 Set aside a percentage of coal royalties for funding the diversification of coal mining regions.
JOBS AFTER COAL: A Just Transition for Queensland  |  1
1.	 Coal’s current role in the Queensland
economy
Coal in the Queensland economy
Over the last 30 years, the Queensland coal industry has grown substantially to become a significant part of
the Queensland economy and create employment in many regional areas. The industry has been concentrated
in the Bowen and Surat Basins throughout rural western and central Queensland. The boom for the industry
began in 2005–2006, when prices for coal rose by around 400% causing massive industry profits in the
2000s (Stanford, 2014). Prices have fallen dramatically since the flow on effects of the global financial crisis
(GFC) slowed down China’s growth in 2011–2012. However prices have remained much higher than the
below US$40/tonne that was averaged through the 90s and earlier (Quandl.com, 2015).
Queensland coal train
2  |  JOBS AFTER COAL: A Just Transition for Queensland
Over the last five years since the GFC and later slow down in coal demand, the total Queensland coal
production has, after decades of growth, levelled off at just over 200 million tonnes per annum (Figure 1).
0
50
100
150
200
250
2008–09 2009–10 2010–11 2011–12 2012–13
Milliontonnes
Figure 1: Queensland Coal Production 2008–09 to 2012–13
Source: Queensland Department of Natural Resources and Mines (2014) Queensland Coal Industry 5 Year Summary 2012–13
Queensland uses 20 to 25 million tonnes of its mined coal for electricity generation each year (Government,
2014). But the rest, which is 85 to 90% of the mined coal, is exported to countries all over the world and
mainly to Asia. In 2013–14, 33% of the production was thermal coal and 67% was for coking coal production
to make steel (Table 1). Both thermal and coking coal create greenhouse gas emissions when they are burnt.
However, contrary to government and media perceptions, the coal industry is not the sole driving force
behind the Queensland economy. As in most modern economies the service industry dominates with 60%
of economic output, followed by the construction industry with 10%, manufacturing at 7% and agriculture,
forestry, and fishing at 3% (ABS, 2014).
An overview of the Queensland coal industry would not be complete without an examination of its level of
foreign ownership. By volume, 80% of Queensland’s coal production is foreign owned (Government, 2013).
This means that a majority of the profits from the operations of these companies are being directed out of
Australia to international shareholders.
JOBS AFTER COAL: A Just Transition for Queensland  |  3
Table 1: Queensland Coal Mining Areas, Production and Types 2009–10 to 2013–14
2009–2010 2010–2011 2011–2012 2012–2013 2013–2014
Mines operating   56   57   58   59   59
Saleable production Open-cut
Northern 76 450 64 167 62 632 71 268 78 953
Central 63 319 52 637 56 032 63 871 73 801
Southern 39 339 37 423 45 010 43 709 43 651
Total (mt) 179 108 154 227 163 674 178 848 196 405
Underground
Northern 7 642 8 965 9 492 13 266 11 470
Central 18 968 16 642 15 082 14 511 18 433
Total (mt) 26 611 25 606 24 574 27 776 29 903
Coking coal total 125 178 108 731 117 000 131 328 151 571
Thermal coal total 80 540 71 103 71 247 75 296 74 737
State total 205 719 179 834 188 247 206 624 226 309
Source: Queensland Department of Natural Resources and Mines (2014) Queensland Coal Industry 5 Year Summary 2012–13
Abbot Point
4  |  JOBS AFTER COAL: A Just Transition for Queensland
Revenue and economic activity generated by the
coal Industry
As a nation, the coal industry is Australia’s second
largest export earner after the iron ore industry. Last
year, it generated $40 billion which equal to about
12% of export revenue (Cleary, 2015). The coal
industry in Queensland will pay around $2 billion
which amounts to 80% of total mining royalties
to the state Government in 2014–15 (Campbell,
2014). Coal royalties represent around 4% of
Queensland Government revenue (Vorrath, 2014).
Similar amounts come from vehicle registrations
and interests on funds saved for superannuation,
in addition to long service leave entitlements, as
shown in Figure 2. Such figures are not large in the
financial context of running a state government.
Despite this, the taxation contribution of coal is
incorrectly perceived as significant.
The large revenues derived from coal exports
is due to the massive volumes the industry has
reached in recent years. Total revenue to the coal
industry from its mining operations amounts to
approximately $25 billion per year that is added
to the economy. This is a significant contribution
to Queensland’s economy, but one that needs
to be viewed relative to the size of the economy.
Queensland’s economy produced output worth
$290 billion in 2012–13, meaning the coal
sector accounted for around 7% of production
by value, as shown in Figure 3 (right).
Commonwealth
grants
Other state
revenue
MV registration
3%
48%
40%
5%
4%Interest
Coal royalties
Figure 2: Queensland State Government Revenue Sources
Source: Queensland Treasury (2014) Queensland State Budget
2014–15 Paper 2
Non-mining
Other
2%
91%
7%
Coal
Figure 3: Queensland gross state product, coal, other
mining and non-mining sectors 2012–13
Source: ABS (2013) Catalogue 52200 Australian National Accounts:
State Accounts
Coal industry jobs and their locations
There has been much debate recently as to the exact number of people employed by the coal mining industry.
Industry figures have been disputed because of the industry’s continual representation and communication
of construction jobs as if they were permanent. In addition, the industry conspicuously classifies indirect
growth in employment within the local economy as jobs that mining development is responsible for creating.
Although in regional mining communities mining employment is high, it is relatively small on a statewide
JOBS AFTER COAL: A Just Transition for Queensland  |  5
level. Most recently the industry’s employment claims were revealed again, in the Australian Land Court
case regarding coal mining development by Indian mining company Adani in the Galilee Basin, to have been
exaggerated (Cox, 2015). Adani’s mine proposal cited the figure of 10,000 jobs attached to its development
application, but the court was told by Adani’s own expert witness that the mine development would only
create 1,464 actual jobs throughout the ongoing operation of the mine (Branco, 2015).
According to research by The Australia Institute, a majority of Queenslanders believe that the mining industry
employs ten times the amount of people it actually does (Campbell, 2014). In reality, the report shows that
the coal industry only employs 1.2% of the Queensland workforce (Vorrath, 2014). What is significant is how
this employee population is regionally distributed, with a majority of the employees residing in the Central
Highlands, Isaac, and Mackay Regional Council areas (Figure 4).
0
5000
10000
15000
20000
25000
30000
W
hitsunday
Sunshine
Coast
Banana
Rockham
pton
Brisbane
CentralH
ighlands
Isaac
M
ackay
Total
Employment
Figure 4: Coal jobs by Local Government Area (LGA) in Queensland: Top 8
Source: ABS 2011 Census. Coal mining jobs by region in Queensland
Summary
The coal industry plays a significant role in the Queensland economy, but it is by no means irreplaceable. As
the next section will show, the coal industry has fallen from the lofty heights of its unprecedented profitability
and aggressive hunger for expansion. It has come to a slower pace, but due to the forecasted change expected
to affect the industry, a new approach to planning local economies beyond coal is required.
6  |  JOBS AFTER COAL: A Just Transition for Queensland
2.	 The drivers of change in the coal industry
Drivers of change
The global energy market is in a period of dynamic long-term structural change that will have ongoing
repercussions for energy exporting countries such as Australia. Over the last ten years, the expansion in gas,
the decrease in renewable energy prices, the increasing of capital infrastructure costs, the demand for cleaner
energy and energy efficiency have all dramatically changed the nature of the global energy economy (Ben
Caldecott, 2014).
Coal has been the energy source that has made so many technological advancements through history possible.
Although, there has been many struggles and social costs along the way. The communities, workers and
companies that made this progress possible have substantially contributed to the creation of the modern world.
Though, if there is one thing we know from history it is that empires rise and fall. The coal empire is crumbling.
As it crumbles it is creating unnecessary instability, stress and hardship on communities. In communities like
Mackay, where income has dropped by 30–40%, as many other small mining towns, people and businesses have
been caught culturally and economically unprepared for this economic shift (Bleby, 2013).
Windmill and wind farm
JOBS AFTER COAL: A Just Transition for Queensland  |  7
It is clear that coal, thermal coal especially, is no longer good for humanity despite our former Prime Minister,
Tony Abbott’s fervent belief that it is (Online, 2014). WA Premier Colin Barnett heralded last year in his
declaration that coal is in ‘structural decline’ (Burrell, 2014). He was not wrong. In the past 5 years alone the
Dow Jones Total Coal Market index has fallen by 76% (Baker, 2014).
The reality is that the world is rapidly shifting away from fossil fuels, including countries that are key
importers of Australia’s coal and gas. China, India, Japan, and South Korea import over 80% of Australia’s
export market for coal and gas. The reality is that these countries have recently either announced policies to
shift away from these fuels, and/or initiatives to drastically enhance renewable energy and energy efficiency
(“Politics of Climate Change in Asia”, 2015).
The following section of the report analyses the risk of Australia not being prepared economically for changes
that are already taking place. As a country and a state, our governing political parties continue to pursue
a strategy that assumes our short and long term economic prosperity is dependent on mining. Few of our
political leaders are attempting to communicate an economic vision free from the inevitable boom-bust cycles
created by extracting emissions-intensive resources. It is also a strategy that assumes energy production and
distribution will continue on as a very centralised process, rather than following the great trend of networked
and decentralised distribution that is shaping the 21st century (Riftkin, 2015). This strategy is short-sighted
given recent announcements by China and India to phase out fossil fuels and move rapidly towards cleaner
and more distributed energy sources (Rohr, 2014).
The international coal price
The majority of Queensland’s export coal mining industry is dependent on demand for steel making from
the world’s coking or metallurgical coal market. This is a market that has been severely impacted by a
combination of actions in China, the biggest steel manufacturer in the world. Primarily, China’s housing
boom has been slowing down over recent years; this, in turn, has massively reduced the need for steel. Most
importantly China is also running a “war on pollution” that is having direct short- and long-term impacts on
the viability of the coal industry as a whole. This has resulted in a campaign of state enforced closures of coal
plants and steel mills, especially near the country’s big industrial coastal cities (Ng, 2015).
Prices on the international coking coal stock market have plummeted from the all time high of US$330/
tonne in late 2011, to a sobering low of US$109/tonne in the first quarter of 2015. The outlook still remains
gloomy for the coal sector.
With the continued slowdown in the global and Chinese economies, the price of iron ore has also collapsed.
Prices have dropped by one third in the first quarter of 2015 alone, causing at least one Australian mine to
close operations and many others to cancel plans for expansions (Sandersen, 2015). Iron ore is closely linked
to the sales of coking coal, which is used most commonly to melt iron ore into steel.
8  |  JOBS AFTER COAL: A Just Transition for Queensland
2014US$/t
0
100
200
300
400
2005 2007
high quality high coking semi-soft coking
2009 2011 2013 2015
Figure 5: Coking Coal Prices 2005–2015 (worldcoal.com)
A similar price drop has hit thermal coal used in coal-fired power stations. Thermal coal is mined in many
Surat Basin mines and is also found in some Bowen Basin mines, where it is an addition to the high quality
coking coal found in the area. Significantly, the proposed mining development in the Galilee Basin is only
for thermal coal which, at a time when coal-fired power stations are being replaced by cleaner options, is
alarming (Pacific, 2012). Thermal coal was priced at US$120/tonne in late 2011. It had plunged to US$73
per tonne by February 2015 and has remained below US$60/tonne since May 2015. China’s new rules of
cutting ash and sulphur content in seaborne coal imports, along with increasing tariffs on coal imports, has
meant that even Shenhua, China’s biggest coal company, cut coal imports in early 2015 (Jenda, 2015).
Overall, Chinese consumption dipped by 1.6% in 2014 despite their economic growth of 7.3%.
The decade of relentless and largely unplanned investment in Queensland coal mining in times of high prices
led to a massive oversupply against a background of decreasing demand. The state and federal governments
failed to slow the industry down so that it did not overshoot an economically sustainable size. This has made
the challenge of transitioning out of the industry even harder, along with magnifying the pain now faced by
many mining towns (Neubauer, 2015). All of this leaves a million-dollar question: Is the downshift in [coal]
demand terminal? According to Richard Gibbs from the Macquarie Bank, it certainly is (Neubauer, 2015).
The global coal market is also experiencing competition from renewables and shale gas, slow growth and
government policies, which are, in part, driven by the threat of climate change.
The growing competition from renewable energy sources has been increasing its impact on the coal industry
by slowly but steadily eroding profits of domestic coal power stations—and thus demand for coal—across the
country (Hewson, 2015). In Queensland the state government should be applauded for its 50% renewable
energy target by 2030 which will further add strain to struggling coal power generators (Parkinson, 2015).
A more than 50% decline in coal prices has seen most listed coal companies globally to lose 80–90% of their
equity market value in the last four years (Buckley, 2014). In 2014 the world added more energy generation
capacity from wind power than from coal. Overall, Europe and America have already cut coal-fired generation
JOBS AFTER COAL: A Just Transition for Queensland  |  9
capacity by over a fifth in a decade. The sun will undoubtedly rise even further for renewable energy in 2015,
but for coal, there remains a lot further to fall,” said a report by the Institute for Energy Economics and
Financial Analysis in January 2015 (Buckley, 2015a).
This statement is borne out by the facts:
•	 In 2014 new global wind installations grew 40% to 46GW, led by China and America (Buckley,
2015b).
•	 In 2014 the US solar installation sector created almost 50% more jobs than the oil and gas pipeline
construction industry (Foundation, 2015).
•	 From 2000 to 2011, global annual growth in the yearly global installation rate of photovoltaic solar
panels was 40%. In 2011, the total amount of global PV capacity installed was 27GW, an astonishing
60% growth on 2010 levels (Green, 2012).
•	 Unsubsidised renewable energy is now cheaper than new coal-fired power in Australia (Paton, 2013).
Solar installation
10  |  JOBS AFTER COAL: A Just Transition for Queensland
International mining companies
It is not just in Australia that coal mining jobs are being lost. Internationally, the picture is very similar—
the global coal industry is being hit hard and jobs overseas are also being lost. Rather than just wait for
continued disruptive innovation, along with human and environmentally-oriented policy shifts to drive them to
bankruptcy, the world’s biggest coal companies are restructuring. A good example is the German energy giant,
E.On. The company has stakes in all forms of energy from coal to gas, nuclear and renewables. In December
2014, the company announced that it wants to focus on renewable energy and has parcelled all of its
fossil fuel interests into a separate company to avoid the risk to its primary growth-driving renewable energy
company (Hope, 2014). Mining giant Rio Tinto has also signalled a move away from coal mining. It has done
this by separating its coal assets into a different company. Along with BHP Billiton, who have halved their
coal use, both mining companies have sold off many of their thermal coal mining operations in Australia and
globally (Buckley, 2015c).
In the US, the birthplace of many new technologies, the coal industry is in free-fall like nowhere else. A massive
expansion in shale gas has shifted energy production towards gas leaving the domestic consumption oriented
coal industry stranded(Mathieson, 2015). This has caused historically major mining companies, Arch Coal and
Peabody, to lose massive value resulting in lower share prices than seen for decades. Like dedicated Australian
coal miners Whitehaven Coal and Newhope Coal, neither of these companies have anywhere to go. They are run
purely on coal. They do not have the diversification options that E.On and BHP have available to them.
Coal power station
JOBS AFTER COAL: A Just Transition for Queensland  |  11
The outlook for coal prices
While some consider the outlook for coal prices as cyclical in nature and that a turnaround will increases
prices for coal, other analysts believe this downward trend, based on policies, health impacts and concern
about global warming is here to stay.
Financial reports from the major mining companies in Australia paint a grim outlook for global metallurgical
coal prices. China was once the great hope for coking coal exporters, but BHP Billiton’s metallurgical coal
market outlook (May 2013) indicated a flattening demand into the future (Billiton, 2013; Rohr, 2014).
BHP Billiton has warned that the increased usage of scrap metal in furnaces would result in lower growth in
demand for pig iron, while greater production from electric arc furnaces—which use little or no coking coal—
are expected to “contribute a significant share of total Chinese steel production by 2030”. Although coking
coal will likely remain necessary for steel production for some time, as renewable energy sources grow, the
efficiency and lower emissions intensity of electric arc furnaces will help them to outcompete coking coal in
the not too distant future. Some experts even predict another technology called ‘direct reduced iron’ that uses
gas to make steel could make coking coal redundant within a decade (Macleod, 2013).
It is not just China; BHP Billiton also cautions that the Indian steel outlook is less certain as steel production
growth has been slower than expected. Prices for commodities from iron ore to coal are sinking, as China’s
leadership tries to steer the economy away from debt-fueled property investment and smokestack industries,
embracing services and domestic-led consumption. At the same time, President Xi Jinping is stepping up efforts
to combat pollution. The provincial government of Beijing and a number of other major cities have made plans to
ban coal use by 2020, further putting the squeeze on all types of heavy industry (Coulter, 2015).
However, the outlook is not all dismal for coal everywhere. In India, demand is expected to continue to rise
without peaking until the 2030s. India’s government predicts a 19% rise in coal imports this year, which
may offer very short-term opportunities for Australian miners. The opportunities are short term because these
import increases are something the Indian government has indicated it does not want continued into the
future. India’s plan is to ramp up renewable energy technology, as well as develop their untapped coal fields
to support a gradual phase out of thermal-coal imports within the next 2–3 years (Baker, 2014). Regardless
the Indian mining giant Adani still hopes it can get coal from its proposed Carmichael mine in the Galilee
Basin and export it to India for the duration of its 60 year life span. After a number of international banks
have ruled out funding for the Carmichael coal mine, Adani has been looking for cash handouts from the
Australian Government to fund its shaky proposal. However, sanity has prevailed and these have been ruled
out by the new Prime Minister (Edis, 2015). It is clear the Indian government’s plan for India’s future coal
supply sources does not involve Australian coal.
12  |  JOBS AFTER COAL: A Just Transition for Queensland
This is the marketplace in which Australia’s exported coal competes and this is the marketplace that holds the
livelihoods of workers and communities in its hands. The current state and future outlook of the coal industry
suggests that it would be risky not to scale down the thermal coal industry and at least restrict any new mine
expansions in the coking coal sector. There are those who remain positive about the industry’s future but,
recent events in the coal industry and uncertainty over medium and long term suggest that there are better
industries to back. Behind these diverse risks threatening the coal industry is the inescapable scientific
fact that we cannot afford to burn any more coal from new coal mines if we want to decrease the risk of our
already fifty fifty chance of avoiding the worst impacts of global warming (IPCC, 2013). If we wanted to try
and remove the total risk of runaway climate change we could not even afford to burn the coal that are sitting
in trucks, on trains, at port yards and in ships. Not even the coal travelling on conveyors into power station
furnaces about to be burnt right this very moment.
The carbon bubble
From the South Sea Bubble, as well as the housing and dot.com bubbles of the last decade, periodic over-
investment has been made into sectors deemed too important to fail. The rush and hubris of investors seeking
incomparable profits to finance such industries has led to speculative bubbles of over-estimated value that
eventually burst. In the economic fallout that results, working people carry the burden, while the speculators
and profiteers generally are not held accountable. Another speculative bubble has formed, and it dwarfs the
size of all of the bubbles that have come before it. It is called the Carbon Bubble (Tracker, 2015).
One of the few things world leaders agreed upon at the Copenhagen climate talks was that the Earth needs to
stay below 2°C warming to minimize the risk of runaway climate change:
•	 If we are to avoid going over 2°C, we can emit only 565 more gigatonnes of carbon dioxide (IPCC, 2007).
•	 Burning the fossil fuel that corporations now have in their reserves would result in emitting 2,795
gigatonnes of carbon dioxide—five times the safe amount (Leaton, 2013).
The Intergovernmental Panel on Climate Change has now produced its own carbon budget. They have calculated
that if we continue pumping carbon into the atmosphere at today’s rate, this budget will be exhausted within
15–25 years (IPCC, 2013). This means there will be growing political pressure on the fossil fuel industry to
keep most of its reserves in the ground. That pressure has already begun around the world. Citizens are pressing
their superannuation funds, councils, banks, universities, and other institutions, to divest from fossil fuels with
growing success. The year 2013 saw several major financial institutions recognise the financial and ethical
implications of continuing to finance fossil fuels, with Norwegian Storebrand, Rabobank, and the World Bank
among those who made major announcements on divestment or cutting loans. In 2014, major institutions
including Stanford University, the Australian National University and Oxford University, have divested their fossil
fuel funds (Advisors, 2015). So far in 2015, local councils in Australia such as Moreland, Newcastle, Byron Bay,
Melbourne, and many more have also divested (Ryan, 2015). Divestment is now going mainstream and will have
increasing impacts on fossil fuel company shares into the future.
JOBS AFTER COAL: A Just Transition for Queensland  |  13
As a result of the momentum of the global divestment movement international stock exchanges are creating
new indexes to exclude fossil fuels in preparation of the impending seismic shift in global finances. In late
April 2014, the world’s largest fund manager, Blackrock, joined with the FTSE Group in London to create
a new index. The ex-Fossil Fuels Index Series is an innovative set of benchmark indices that excludes
companies directly engaged in extracting so-called “stranded assets” in the hydrocarbons industry. “This
is one of the fastest-moving debates I think I’ve seen in my 30 years in markets,” FTSE managing director,
Kevin Bourne, told the Financial Times (Clarke, 2014). The Bank of England is now investigating its exposure
to risk from its fossil fuel investments. To top that off, the world’s biggest sovereign wealth investment fund in
Norway has recently dumped coal investments (Carrington, 2015). The largest contribution to climate change
from the fossil fuels in company inventories at present is from coal. Because it has the largest climate impact
per unit of useful energy, it is being targeted for early phase out.
The book value of fossil fuel companies is determined not only by their current infrastructure and deposits
undergoing extraction, but also by the size of their legally claimed reserves. Because the book value of so
many companies has greatly exceeded their realisable value as emissions restrictions come into place, a
speculative bubble has formed. Unfortunately, bubbles usually burst in the end, leaving behind stranded
assets and stranded capital—and leaving workers in the lurch. The only alternative is a mature and planned
phase out of the industry that slowly devalues and deregisters fossil fuel reserves at a pace that does not lead
to financial crisis. A planned phase out that gives time for just employment transitions for fossil fuel
communities.
500
1000
886
565
1500
2000
2500
3000
already burnt
remaining
2000–2050
2011–2050
Coal
2˚Global carbon
budget
Oil
Gas
GtCO2
Global
fossilfuelreserves
Figure 6: Carbontracker 2012 report: The Carbon Bubble
14  |  JOBS AFTER COAL: A Just Transition for Queensland
In 2013, the report Unburnable Carbon highlighted that: “Company valuation and credit ratings
methodologies do not typically inform investors about their exposure to these stranded assets” (Leaton,
2013). This is very troubling when considering that the supporting share value of these reserves was $4
trillion in 2012, and that they serviced $1.27 trillion in outstanding corporate debt over the same period. We
need to challenge these methodologies (Tracker, 2015). In a move that signals a step towards the solutions
required, the World Bank, the European Investment Bank and the US Export-Import Bank have all announced
that they will not fund further coal-fired power plants except in exceptional circumstances. As changes in
policy by the major coal consumers, the uptake of renewables and the need to stay within the global carbon
budget begin to bite, it is high-cost producers who will be squeezed first. Australia is considered a high-cost
producer because of our strong industrial relations and wage laws which makes it all the more necessary that
our governments are vigilant and prepared for impending macroeconomic change (Cleary, 2015).
Summary
This is the environment in which the Australian coal industry finds itself. Internationally, coal is no longer
looking like a safe long-term investment within the context of the rapid changes afoot in the world. The coal
industry leaders are either in denial about their industry’s future or are determined to squeeze as much profit
as possible until the cost gets worn by workers and their communities (Saunders, 2015).
The issues of climate change demands for cleaner air and more efficient new technologies. The realities of
the market are revealing coal as the sunset industry it really is. This is not an industry Queenslanders can
rely on to create a stable, resilient, and sustainable economy. It cannot be relied upon for future wealth
and future jobs. We have been warned by the UN Climate Change Secretariat’s Executive Secretary that the
diversification and a managed transition away from coal is what we need to do and we need to heed this
warning (Australian, 2015).
JOBS AFTER COAL: A Just Transition for Queensland  |  15
3.	 Assessing some of the economic
opportunities in mining regions
Introduction
The great state of Queensland is endowed with sustainable human and environmental resources that have the
potential, if we choose to harness it, to drive a balanced, diverse, and resilient economy for generations to
come. Diversifying Queensland’s economy to create sensible and stable prosperity beyond the boom and bust
vagaries of the mining industry must be a key objective of the Queensland Government. The Newman LNP
Government’s Queensland Plan headline was ‘forging diversity and prosperity’ (Government, 2014). But
throughout Newman’s reign as premier, no action was taken. Under the new Palaszczuk Labor Government,
there has been some effort to support economic diversification across the state. This is insufficient because as
of yet, nothing has been done to adequately fund, facilitate and empower the actual communities where
mining takes place. The grassroots Labour Environmental Action Network, an organisation within the
Australian Labour Party has called for change. At the 2015 Queensland ALP State Conference, they put
forward a motion that was passed calling on the state government to prepare a just transition policy before the
next conference (ALP, 2015).
Grain harvest
16  |  JOBS AFTER COAL: A Just Transition for Queensland
Most importantly, both major parties have continued their relentless support for further coal mine expansions
that inherently suffocate the process of diversification.
With the coal industry forecast to be in a ‘structural decline’ by political leaders and bankers alike, it is now
essential that the focus for economic development be on industries that can bring sustainable prosperity to
Queensland (Burrell, 2014; Robins, 2014). In the United Kingdom under Prime Minister Thatcher the world
witnessed the consequences of industries closing without planning and without investment to transition local
communities and industries.
The following section of the report outlines how the opportunities for sustainable economic development
are already known. Queensland has well-established sectors with bountiful potential in agriculture, tourism,
manufacturing, and education. It also has the opportunity to capitalise on a boom in renewable energy and
bio-industrial products to create more sustainable economic sectors. These industries are ready to fill the
void that will be, and is being, left by coal; however, they lack the support needed to ensure their presence in
mining communities to provide a just transition away from coal where it is most needed.
Agriculture and aquaculture
Currently the Queensland agricultural sector is worth near $14.7 billion and employs over 90,000 people
(Queensland Government, 2012). The sector has the potential to massively expand its food exports to Asia as
population and economic growth continue to surge in the dynamic economic region. Through the competitive
advantage of our proximity to Asia and high-quality produce capabilities, agricultural products have become
Queensland’s second largest export earner and have the potential for continued growth (Heath, 2014). By
increasing availability of farming technology, driving productivity, minimising costs, and focusing on profitable
premium produce markets, the Queensland Agricultural Strategy (2012) aims to double the total value of
production for all agricultural commodities by 2040. With innovative new farming approaches and ecosystem
system management strategies such increases in production are possible in a way which sustainably manages
and regenerates the land.
To reduce pressure on fish stocks from home and abroad the promotion of aquaculture could be further
encouraged across the state. This industry is worth $10 Million a year (Lucas, DLGP, 2011). At present
there are several sites located along the coast, however research conducted over the last decade has
identified future sites for land based aquaculture. Industry consultation, aquaculture management training
programs and related issues in developing a workforce need to be considered (Plan., 2012). The Queensland
Aquaculture Industry Federation sees the need for continued collaboration between government and other
stakeholders in order for this industry to reach its’ potential as a strong core industry (Federation, 2015).
The Department of Employment, Economic Development and Innovation is leading the government drive to
JOBS AFTER COAL: A Just Transition for Queensland  |  17
develop the aquaculture industry. This could see a future where aquaculture goes further than just meeting
domestic demand, and grow to cater for high value export markets (Lucas, DLGP, 2011).
New opportunities in animal genetics, aquaculture, horticulture, and bio-processing are driving agriculture
and aquaculture sector growth in new directions. Both industries are about creating intergenerational
economic sustainability. Choosing these industries that have unlimited potential to sustain our communities
and our ecosystems over mining is choosing long-term jobs over short-term jobs that cannot be passed on to
the next generation. The bottom line is that we live in a hungry world and Queensland is well placed to be a
reliable and sustainable source of food to other nations without the agricultural potential we are endowed with
(Government, 2014).
Tourism and recreational fishing
Despite setbacks due to the high Australian dollar and loss of skilled workers to the mining boom, the
tourism industry is still a critical part of the Queensland economy with massive future potential (Dr Tien Duc
Pham, 2015). The tourism industry made a significant employment contribution providing 124,000 jobs in
2010–11, with steady growth in international visitor nights (Deloitte Access Economics, 2012). Queensland
has the potential to become a global leader in tourism and ecotourism and by doing so to create more
jobs and revenue (Government, 2014). This will be possible, similarly as in agriculture, by promoting the
experiences available in our natural places and the quality hospitality we can provide to the growing Asian
middle class (Wilson, 2013). The Chinese tourism market is seeking clean, fresh, and new experiences that
Queensland can cater to and is expected to be worth $7.4 billion by 2020 (Guterres, 2014). Significant to
Queensland’s potential in tourism is our ability to expand the tourism industry in the authentically Australian
rural and stunningly beautiful coastal mining communities where new economic activities are most needed.
Further mining expansion in such places threatens to do to tourism what the growth in heavy industry did to
Gladstone’s economic diversity, where fishing and tourism are now non-existent.
Although sustainably managed fisheries have the potential to provide continued economic prosperity to
Queensland there lies a major opportunity in net free fisheries to develop as tourism industries specifically
in coal mining regions. A great recent example of this taking place is the newly established Net Free Zone
between from the Northern end of St Helens beach to Cape Hillsborough (Spelitis, 2015). Along with three
other net free zones across the state the extent of the cumulative commercial opportunities for sustainable
tourism the net free zones have created has made it one of the three pillars as part of the 2020 vision for the
Queensland has the opportunity to develop an abundant and resilient
agricultural industry that supports the transition to sustainable prosperity.
18  |  JOBS AFTER COAL: A Just Transition for Queensland
Queensland Tourism Industry Council (Council, 2015). The Mackay, Isaac and Whitsunday (MIW) coal mining
region has excellent accessibility to a variety of fishing pursuits. In addition to the new net free zone ther are
five fresh water stocked impoundment fisheries creating opportunities to promote lake, beach, offshore and
deepwater angling. Improvement of accommodation facilities, quality of jetties, access roads and coordinating
fish trails with regional events could maximise visitation from recreational and tourism markets (Mackay
Tourism, Tourism Queensland, 2012). Charter fishing operatiors, tackle stores, campsites, motels, boat sales,
boat building and maintenance all have the opportunity of benefitted from growth from the recreational fishing
tourism industry (Lucas, DLGP, 2012).
Higher education
Over the past decade millions of international students have visited Queensland for our quality tertiary
institutions and enjoyable lifestyle. International education is Queensland’s biggest service export with
nearly $2,431 million being generated in 2013–14 alone (Australian Government, 2014). The majority
of Queensland is strategically located in the latitudinal tropical zone where, at a global level, more than
50% of the world’s population is forecasted to live by 2050 (Australian Government, 2015). This makes
Queensland’s universities well placed to develop the partnerships and research innovations tailored to the
challenges and opportunities of the new tropically-oriented world. This will help Queensland, and especially
North Queensland, to attract increasing levels of international students to be part of our high-quality tropical
research institutions. These students will increase spending through tourism, support the creation of our own
skilled and globally connected workforce and connect Australia to business networks and opportunities across
the world. In 2013–14, the Cairns region benefitted to the tune of $137.5 million from international students
(McGuiggan, 2014). With the right policies these benefits already being experienced primarily in Cairns,
Townsville, and Brisbane, can be spread further across Queensland to make international education a strong
economic driver in transitioning mining communities.
Bio-industrial products
As the world moves away from fossil fuels the demand for cleaner, more sustainable fuel sources will grow
(Emissions, 2014). By using excess organic matter produced through food production to develop bio-industrial
products, Queensland has the potential to export clean and sustainable fuels and bio-plastic materials to the
Tourism is about experiences, not extraction. It has the potential to share
Queensland beauty with the rest of the world and create sustainable local
economies in the process.
Queensland’s greatest resource is the minds of its people. We can share
and co-create our innovations and learning with students from all over
the world who want to make Queensland the launch pad for their careers.
JOBS AFTER COAL: A Just Transition for Queensland  |  19
world for generations to come. This economic opportunity is uniquely important because it is the mining regions
that have some of the greatest potential to capitalise on it and create new jobs by doing so. In recent years
the bio-plastics sector has grown to make up 10–15% of the global plastics industry. Unfortunately, despite
its massive potential, Queensland is still not yet involved in this industry at a significant level (Queensland
Government, 2010). This is despite several modeled projects that indicate the potential contribution to
Queensland economy is estimated to be $1.8 billion annually creating 6, 640 jobs by 2035 (Deloitte Access
Economics, 2014). This is such a potentially lucrative industry that investment to fuel this growth, given the
enough initial government support to build momentum, can come from the private sector.
The bio masse (feedstock) used to create bio-based products are readily available in the MIW regions.
Agricultural bio waste and non food feedstock is an area where MIW can lead internationally, with licensing
and technology development, the access to a skilled workforce, research infrastructure, stable government,
natural assets, strong regulatory system and close vicinity to Asia being local advantages. The transition
from research and development in the laboratory to pilot plants to commercial development is slowly taking
place. At the Furfural Plant at the Proserpine Sugar Mill and at the QUT Mackay Renewable Bio-commodities
centre pilot plants are in operation (Department of Employment, Economic Development and Innovation,
2010). The bio-technology provides the opportunity to value add to the agricultural and forestry sectors in
feedstock supply. Manufacturing nearby full scale plants could potentially benefit in the production of fuel,
pharmaceutical and construction products that compliment bio based chemicals and liquids created (Deloitte
Access Economics. 2014).
Sorghum fields
20  |  JOBS AFTER COAL: A Just Transition for Queensland
Queensland is well placed to develop biofuel products from waste and oil crops such as Pongamia and algae,
in addition to using the state’s advanced sugarcane industry to convert excess cane using efficient cellulosic
processes. Recent scientific developments in bio-plastics at the University of Queensland show that, as a
state, Queensland has the skills and ability to build a bio-industrial products industry that can contribute to a
sustainable economic future (Queensland, 2015).
Renewable energy
Queensland, the sunshine state, has enormous potential to generate electricity from the sun, wind and waves
in addition to many other abundant renewable energy sources (Green, 2012). Renewable energy has for a long
time been the catch cry from environmentalists as the complete solution to creating the jobs necessary to
replace the fossil fuel industry. This report has been written partially to show recognition that as much as
renewable energy has the potential to create more jobs and replace fossil fuel domestic energy production, it
The mining boom has created an unsustainable dependence on fossil
fuel exports. It is time to build an economy that has the potential to
last forever. A bio-industrial products export industry is Queensland’s
opportunity to do this for the benefit of communities today, and for
generations to come.
Gemasolar solar thermal power station, Spain
JOBS AFTER COAL: A Just Transition for Queensland  |  21
cannot completely replace all of the coal
export industry jobs. Numerous studies
show that with strong climate policies,
over 7,100 jobs can be created in
Queensland through renewable energy
by 2030 (Institute, 2011). Thousands of
these jobs will be in regional
Queensland. These should be prioritised
for regions where the mining industry
has developed rural communities in
need of new economic opportunities. Far
North Queensland is especially suited to
further renewable energy investment
because of its climatic conditions and
because of the expensive transmissions
losses from having energy wired from
southern power sources (Allen, 2011).
This makes it essential that government
policy ensures that the fair share of the
$3.5 billion in potential renewable
energy investment goes to rural mining
communities, not only where it is most
needed economically, but where it
makes the most business sense
(Department of Employment, 2009).
Queensland has the potential to become a smart sunshine state powered
by clean and sustainable renewable energy. By doing this we will be
creating jobs in rural mining communities where they are needed most
and building a foundation for a new sustainable economy.
22  |  JOBS AFTER COAL: A Just Transition for Queensland
4.	 Community transitions:
Global case studies
There are communities around the worldwhich have reinvented themselves after the end of coal mining, and
developed prosperous economies in doing so. It has been a struggle, but where there is a level of government
support, inspired local leadership, and the community is working together to regenerate its economy, it has
been possible (Coal, 2015). We are not suggesting any of these examples can be directly transferred to
Queensland communities facing the end of coal mining. The object of these case studies is not to provide a
blueprint for Mackay, Gladstone, Rockhampton, or mining towns in Central Queensland, but to show the
diversity of ideas that have worked in other places that might stimulate our local communities to reinvent
themselves too.
Hazelwood coal power station, La Trobe Valley, Vic
JOBS AFTER COAL: A Just Transition for Queensland  |  23
La Trobe Valley
In the brown coal producing region of the La Trobe Valley in Victoria, a grassroots transitionary force has been
underway for the past fifteen years. Earthworker was set up by union and climate change activists seeking a
real alternative to coal and privately owned business models. Earthworker Cooperative’s mission is to create
jobs that respond to the ‘challenges of climate change and the need for local job creation by facilitating the
establishment of worker-owned cooperatives … in sustainability-focused industries’ (Earthworker, 2015).
Their current focus is the establishment of a cooperative producing solar hot water systems in partnership
with an existing business called ‘Everlast Hydro Systems’. Their goal is to take production to Morwell in the
La Trobe Valley where workers are in need of an alternative to the coal industry. The unique cooperative model
has made selling arrangement possible through inserting the option to buy a solar hot water system through
enterprise bargaining agreements.
Banwen
The DOVE workshop in Banwen, South Wales (Dove, 2015), was started by agroup of women who, during
the 1984–85 coal miners’ strike, decided that community-based education was the most practical path to
regenerate the local economy. Setting up shop in an abandoned mine office, they developed a series of adult
education workshops for women. Three decades later, the DOVE building hosts a diverse set of small-scale
entrepreneurs, including a daycare, a library, a community garden, and a café featuring local foods.
Orkney
Orkney, like Central Queensland, is a relatively isolated place with a scattered population. Situated at the
top of Scotland, two hours from the mainland by ferry, Orcadians, like Central Queenslanders, often feel
like spectators to what goes on in the rest of their country. They also feel vulnerable to central government
decisions and are often irritated by the lack of understanding of island life on the part of distant authorities—
its particular customs, dialect, and ways of doing things. Since Norse times Orkney islanders burned peat (a
very young form of coal) as their primary fuel source, but all the peat has been dug up. This traditional way
of life, where each farming family had its own peat bank and spent long summer days cutting and drying
peats while sharing picnics as children played, is gone. Another non-renewable energy source, North Sea oil,
discovered in the 1970s, brought positive and negatives for the island. It turned the tide of depopulation, but,
like the peat banks, the oil is depleting and another ‘end of an era’ is approaching. Orcadians have woken up
to the fact that they can’t continue to hark back to the past and are confronting the issues of a future without
fossil fuels.
Over the last three decades European community funding has helped Orkney to equip itself for the green
energy revolution. Orkney now plays a global role in the evolution of wave and tidal technologies and
significant research and development work is creating new employment opportunities. A high school in
Stromness was converted into the European Marine Energy Centre and is now a world leader, providing
developers the opportunity to test full-scale prototypes in the sea. The world’s largest single-rotor tidal turbine
24  |  JOBS AFTER COAL: A Just Transition for Queensland
was the first in Scotland to be connected to the national grid from this centre. Marine energy, combined with
an expansion of wind turbines, means that the island is now self-sufficient in electricity. These renewable
energy developments have created jobs in the Orkneys in civil works and erection, grid connection, and
communications (Stuart, 2011).
Investment in renewable energy and its associated R&D has attracted people to live, work, and study on the
island. Islanders used to have to leave to get tertiary education but it is now possible to study for an MSc in
renewable energy at a Heriot Watt University campus in Stromness. A new generation of Orcadians have grown
up to see renewable energy as the way of the future, something quite “normal”, which will provide greater
opportunities for their children to stay on the island, with genuine prospects for employment in meaningful
jobs requiring a wide range of skills and qualifications. This shows what a community in transition to a low
carbon future can look like.
Nord-Pas De Calais
Until 1986, the north-east region of France, Nord-pas de Calais, was a major coal mining area. It still boasts
huge twin tailings mountains, the largest in Europe, which have become a tourist attraction. It is known
to Australians for the war cemeteries associated with the battle of the Somme in WW1, but it has recently
undergone a remarkable transformation towards a truly sustainable economy. Old coal mines at Lens have
been transformed into an art gallery, displaying works from the Louvre collection in Paris. Hundreds of people
are trained in energy efficiency, solar energy, and green architecture at a new training centre in nearby Loos-
en-Gohelle.
The Chamber of Commerce invited economist and social visionary Jeremy Rifkin of the TIR Consulting
Group, and his chief economist Skip Laitner, to apply their model of the third industrial revolution to the
district (Riftkin, 2015). Rifkin’s Third Industrial Revolution combines renewable energy, energy efficiency,
and the connectivity of the internet. Buildings are energy generators and hydrogen is used as energy storage.
After working with the community for some time the Master Plan was published in 2013 and envisages
that 100,000 new jobs can be created by the transition plan (LLC, 2013). Certainly, the population has not
declined since mining days and has even slightly increased. Inspired local leadership was the key in this
community, plus some outside funding to help with the underpinning research.
Appalachia (Kentucky)
The transition process is just starting here, but the community is very organised. Kentuckians For The
Commonwealth has been battling the negative effects of coal mining for some decades and is now planning a
transition to “building a better future, beyond coal” (Commonwealth, 2015). Last year they held a conference
in Harlan, Kentucky, right in the middle of the Appalachian coal fields and invited guests from other US
regions in the same position, as well as from Wales. It is too soon to see what the outcome of their learning
process will be, but they are another example of a community taking its future into its own hands—optimistic
that there is a better future after coal.
JOBS AFTER COAL: A Just Transition for Queensland  |  25
5.	 A just transition for coal mining
communities policy recommendations
The opportunities to transition from unsustainable coal mining to prosperous communities with decent
employment will not just materialise by themselves. It will need the political will and the right incentives to
ensure that communities are not left fending for themselves, with unemployment increasing and families
in need of long-term welfare. But not only is the political will not currently there, both major political
parties continue to support the expansion of this sunset industry, and by doing so are making the transition
challenges progressively more difficult (Denniss, 2012). For too many years, governments have uncritically
supported the coal mining sector. Entire government departments have been focused on facilitating mining
with tax incentives, weakening assessment and approval processes, along with providing through tax payer
money, established industrial infrastructure to support new projects. Government policy often seeks to grow
royalties income by supporting the extraction of as much coal as possible as an escape the challenge of
finding other ways to increase state revenue. New sustainable industries in coal communities will need just as
much if not more support while it gets started.
We propose that communities, local businesses, workers, unions, community groups, environment groups,
local government and state and federal governments, all need to be involved in planning a transition to
alternative forms of economic development and providing new jobs. We call this a Just Transition (Anthea
Bill & Evans1, 2008; Brecher, 2012). Just Transition is a framework for a fair and sustainable shift to a low
carbon economy, proposed by trade unions and supported by environmental NGOs. A Just Transition holds
that a shift to a lower carbon economy is vital to avoid dangerous climate change.
Bimblebox Nature Refuge
26  |  JOBS AFTER COAL: A Just Transition for Queensland
Tough targets to cut greenhouse pollution, supported by new environmental regulations and emerging carbon
markets, will transform the global economy over the next decade. These shifts will have major implications
for working people in energy supply, industry and transport and for everyone as consumers. There is a concern
that significant periods of economic restructuring in the past have often happened in a chaotic fashion,
leaving ordinary workers along with their families and communities, to bear the brunt of the transition to
new ways of producing wealth. A just transition seeks to prevent such injustice becoming a feature of this
transition, suggesting that it would not only be morally wrong and socially damaging, but would undermine the
credibility of the transition itself and could slow or even halt the changes that must be made.
It is through the challenges of communicating the urgency of climate change and other social and
environmental impacts that much of the debate about coal and its consequences for land, water and the
climate has become unnecessarily adversarial and polarised. Coal mining and power generation communities
deserve acknowledgement and appreciation for all that they have historically and currently contributed to
our country and our economy. In communicating the economic shifts that are taking place and facilitating
the necessary transitions, the Australian community needs to be respectful of the history and identity of coal
communities. Environment groups, government, unions and the community need to initiate and engage in
the discussions about transitions in an open, honest and compassionate manner. Only by approaching the
transition in this way can the adversarial nature of the debate be broken down to make way for transformative,
mutually respectful and holistic solutions.
Whitsundays ‘Have a Heart for the Reef’
JOBS AFTER COAL: A Just Transition for Queensland  |  27
A just transition recognises that support for policies are conditional on a fair distribution of the costs and
benefits of those policies across the economy. A just transition should also recognise that the creation of
opportunities for active engagement by those affected in determining the future wellbeing of themselves
and their families is essential for the long term empowerment of citizens and communities. The following
recommendations have been written with the aim of emphasising such community empowerment as a priority.
Recommendations
1) Establishing a unit within the State Government to support coal mining
regions to transition to new economies
Specific institutions are needed to develop transition plans. They need to have strong government support
and funding, regional offices, and representation from diverse stakeholders. A dedicated unit within the
Department of Infrastructure, Local Government and Planning could be established to oversee this work.
They could work on the ground in the main coal mining communities to bring government expertise into
regional entities that would develop local plans that involve and empower the whole community. This unit,
or a connected unit, would analyse existing barriers to the creation of competitive advantages for alternative
sustainable industries, and would identify actions the State Government can take to support such creation.
Any policy and support should come with clear conditions and timeframes. These regional entities would
need generous budgets to assist local groups to develop their transition strategies, to support research, re-
training, and the development of new business and community start-up initiatives, based on the needs and
strategies of communities. The key to communities becoming economically resilient is high levels of autonomy
and freedom in shaping their economic futures. Research funding available to the regional entities will be
essential to the empowerment of local leadership. Research funding should at least reach the OECD research
funding average, and it should prioritise low carbon technologies and industry sectors with increased triple
bottom line sustainability potential.
2) Support community leadership in diversifying local economies through
the establishment of democratic regional entities
In each mining community, a group of traditional and non-traditional community leaders willing to think
beyond ‘Business as Usual’ to imagine a better future could be called together to work in collaboration with,
and be resourced by, the state government managed regional entities mentioned in recommendation one.
The leaders would come from diverse backgrounds such as from local governments, business associations,
unions, farming groups, renewable energy businesses, and educational institutions. The objectives of these
leadership groups would be tailored to each community. The objectives would, in broad terms, be to increase
employment in new, diverse industries based on sustainable production and public/service sector job creation.
Expert facilitation, alongside inclusive and democratic community engagement initiatives, would be essential
to ensure the process and environment for creativity and innovation is maximised. To develop such groups
it would be necessary to take stock of the existing resources, skills, and successful businesses, on which a
new future can be built. In addition, an analysis of the social, environmental, and economic needs of the
28  |  JOBS AFTER COAL: A Just Transition for Queensland
community would also be beneficial. These groups could then establish economic diversification projects,
including value-added local production, worker controlled co-operative enterprises, and new community-
based enterprises that economically empower the local community. Activities may also include support for
alternative industries in regard to process restructuring or subsidising the wages of workers displaced from
higher paying, traditional industries.
3) Support researching and communicating how the just transition can
take place
Consistent research is needed on the best options to support the state and national economies to transition.
This requires ongoing situational analysis of the global energy market shifts at both government levels. In
addition, each mining region will need assistance to research the number of jobs that are dependent on coal,
the skills of those employed, the level of local, national, and global long- and short-term risk to local mining
operations, the transferability of jobs to other industries, local opportunities for new enterprises and their
needs, and the local educational and training needs and resources. A key issue requiring research will be
around how the transitition scenarios differ depending on the level and relativity of thermal and coking coal
industries across coal mining communities. The process for sourcing this information at a local and state
government level should be integrated into a policy feedback loop to support cyclical situational analysis and
policy adjustments from all levels of government. This research should take place at the state level and be
encouraged at the industry and local level through grants.
Mackay, Central Queensland
JOBS AFTER COAL: A Just Transition for Queensland  |  29
4) Convene a just transitions state economic summit to identify socially
and environmentally sustainable economic opportunities in mining
communities
Many existing Queensland industries, including those not highlighted in this report, have the potential to
carry Queensland towards a new sustainable economy [sC5]—but they will need support to do so. Instead
of continuing to support and lower costs for the coal mining industry we need a plan to grow competitive
advantage across industries that have potential for sustainability and growth in regional mining communities.
Along with industry and community organisations, the State Government could organise a State Economic
Summit to assess existing industry clusters; identify the potential of new and emerging industries; consider
their competitiveness and key capabilities; and identify barriers to increasing competitive advantage. The
findings and recommendations from this Summit could be used to inform the work of the Unit established in
bullet point one above and the research outlined in bullet point two.
5) Provide social protection of workers, their families, and incomes
If mines close suddenly, workers need protection for their incomes and social services, and possible relocation
even though many miners these days do not live in the communities where they mine. Ideally, these transition
plans would be developed early enough to ensure that new employment opportunities are in place for them
before mines actually close. For many workers this is already too late, but if the process begins now, there will
be choices available for future retrenched coal workers who live in mining communities and regions. Mining
companies could be incentivised and/or penalised to give adequate notice to workers and other stakeholders
that closure may be impending and alternative economic opportunities need to be developed.
6) Supporting Unions to play leadership roles in social dialogues and to
lead worker engagement
Involving the relevant unions in the planning of community transitions can enable them to move towards
becoming more proactive agents helping to plan the transition, with critical networks and specific knowledge
about the needs of their members. When a coal-fired power station in Washington State, USA, was scheduled
for closure for environmental reasons, unions played a pivotal role, persuading environmentalists and others
to delay the closure long enough for a Just Transition to provide different jobs for the workers. This made it
possible for the coal resource to be replaced by wind and other renewable generation, rather than natural
gas—a better environmental outcome, and the unions became an active part in the phase out planning.
Unions have a heavy workload defending workers rights and pay. They need to be supported and financed to
play important roles in community transitions. From facilitation and leadership of planning bodies, career
planning and advice, preferential hiring for displaced workers in the new, alternative emerging industries and
leading the establishment of work controlled cooperatives, unions have an essential role to play.
30  |  JOBS AFTER COAL: A Just Transition for Queensland
7) Provide training opportunities for coal workers and communities
Retraining is crucial. Many mine workers and workers directly supporting industries are from other sectors.
They were attracted by the high rates of pay and had to learn new skills to do their jobs. Some of those
skills will be transferable to other industries—quarries, earthmoving for building, electrical and wastewater
management trades. Preventative action should be taken through mandating coal mining companies to
fund education and training for their workers that give them skills for other industries. Funding should be
made available for training programs to assist retrenched workers from the coal industry to attain continued
retraining and re-education. Re-education could include subsidising a worker at a full living income level for a
maximum of four years to undertake training for careers that support the establishment of the new economy in
their community.
8) Mandate adequate security deposits and progressive signoff for best
practice mine site rehabilitation
There are over 50,000 abandoned mines in Australia and an estimated 15,000 in Queensland alone (Hutton,
2013). Effective management strategies are needed to prioritise and manage health, safety, environmental,
and socioeconomic risks and opportunities that abandoned mines pose to mining communities. Instead,
the mis-management and poor application of weak government regulations means that many mines are still
being closed and not rehabilitated properly. A common practice that must be eliminated is that liabilities
from large mine sites are sold on to smaller companies who, after mining the remaining resources, lack the
resources to rehabilitate mine sites to adequate standards (Hutton, 2013). The Queensland Government can
choose to change this and by doing so create jobs in mining communities through restoring agricultural land
or by reforesting mine sites. This can be achieved by increasing mining security deposits to ensure that the
full cost of third party mine site rehabilitation is progressively implemented and signed off by governments
throughout the life of the mine. In addition, action needs to be taken to prevent mining companies selling
off mines where they have not fulfilled their rehabilitation responsibilities.  Just as James Hardie was
prevented from moving its assets offshore into a subsidiary entity to avoid paying asbestos compo, so too
the big mining companies should be prevented from ‘cutting free’ loss making coal mines to get out of their
rehab responsibilities. To take a holistic approach the Queensland Government should support the nationally
coordinated implementation of the AusIMM Abandoned Mines policy statement that includes the actions
described above and more detailed policy changes (Unger, 2013).
9) Remove all subsidies and tax payer funded support to coal mining
Historically, the Queensland Government has offered and provided incentives and added advantages to the
coal mining industry that have not been received in equal application by other industries (Peel, 2014).
All subsidies to the coal industry should be reviewed to ensure this practice is not ‘disadvantaging other
industries, creating windfall profits, or providing an implicit guarantee to support investment decisions that
turn out to be uncompetitive’ (Hayman, 2014).
JOBS AFTER COAL: A Just Transition for Queensland  |  31
10) Sound investment and resource revenue management
Discussing what economic mechanisms will be needed and how they will operate will be an essential step
in ensuring funding is available for the policy measures below. In many similar situations around the world
‘Severance Trust Funds’ otherwise known as Sovereign Wealth Funds set up specifically for diversifying
resource regions have been promoted and implemented, such as in West Virginia (Boettner, 2012). Along
with ending coal mining subsidies, some part of the royalties from coal mining should be set aside to help
fund the transition. Royalties are very low by international standards and should be increased to help fund the
Just Transition described. Such funding could provide funds for industry-government partnerships that would
develop sustainable jobs in highly mining dependent regions, especially those with few other opportunities for
their community.
Carmichael River
32  |  JOBS AFTER COAL: A Just Transition for Queensland
Conclusion
The reality of the coal industry in Queensland is that the concentration of its operations and employment
in coal communities is leaving communities in great risk of disruptive global economic change. It is not
acceptable for the state as a whole to benefit from the royalties from coal while leaving the communities
working in the mines and in power stations with few economic alternatives or assistance to turn towards as the
industries sunset gets closer and closer.
There is another economic future possible, not only for coal mine workers but for coal mining communities,
but governments need to take action to support communities to determine their future. The State Government
should implement these recommendations as soon as possible to ensure that the future of coal communities
in Queensland is one of hope and excitement. For any community in the presence of such a volatile and
aggressive industry, support is needed to make a just transition and relieve the current uncertainty brought on
by such a risky industry.
Polluted water from a Central Queensland mine
JOBS AFTER COAL: A Just Transition for Queensland  |  33
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Jobs_After_Coal_BM_WEB

  • 1. A just transition for Queensland November 2015
  • 2. Published online by the Queensland Conservation Council in partnership with 350.org on Wednesday the 18th of November 2015 in Brisbane, Queensland. Report Author: Ahri Tallon A very big and special thank you goes to the Coal Action Network Aotearoa for publishing their pioneering ‘Jobs After Coal’ report upon which this report has been adapted. The New Zealand report was originally published May 2014 and was then updated April 2015. Some parts of this report are from the New Zealand report but have had additional information added. Written by Cindy Baxter, Jenny Campbell, Rachel Eyre, Zella Downing, Jeanette Fitzsimons, Kristin Gillies, Tim Jones and Rosemary Penwarden (Cindy Baxter & Zella Downing, 2014). With thanks for input and review to: Kirsten Macey, Shanather Wong, Kirsty Workman, John Ingram, Drew Hutton, Sean Kelly, Nigel Pratt, Rocky Henry, Zane Alcorn, Patricia Julien, Nichola Hungerford, Sabrina Chakori, Scarlett Squire, Amanda Cahill, Ian Daniels, Ellie Smith, Ellen Roberts, Christine Carlisle, Moira Williams, Gemma Plesman, Louise Mattiesson, Abraham O’Neil, Daniel Musil, David Kerin, Jessica Miller, Nichola Hungerford and Rod Campbell. Design by Sharon France of Looking Glass Press Pty Ltd.
  • 3. JOBS AFTER COAL: A Just Transition for Queensland  |  i Contents Foreword iii Executive summary iv Key recommendations for the State Government of Queensland vi 1. Coal’s current role in the Queensland economy 1 Coal in the Queensland economy 1 Revenue and economic activity generated by the coal Industry 4 Coal industry jobs and their locations 4 Summary 5 2. The drivers of change in the coal industry 6 Drivers of change 6 The international coal price 7 International mining companies 10 The outlook for coal prices 11 The carbon bubble 12 Summary 14 3. Assessing some of the economic opportunities in mining regions 15 Introduction 15 Agriculture and aquaculture 16 Tourism and recreational fishing 17 Higher education 18 Bio-industrial products 18 Renewable energy 20 4. Community transitions: Global case studies 22 La Trobe Valley 23 Banwen 23 Orkney 23 Nord-Pas De Calais 24 Appalachia (Kentucky) 24 5. A just transition for coal mining communities policy recommendations 25 Recommendations 27 Conclusion 32 References 33
  • 4. ii  |  JOBS AFTER COAL: A Just Transition for Queensland Bowen Basin coal mine and surrounding area
  • 5. JOBS AFTER COAL: A Just Transition for Queensland  |  iii Foreword The coal industry’s impact on the state of Queensland has had its peak and is now in decline. This makes right now the most important time to be thinking about not just stopping the industry’s destruction of prime agricultural land but also how we build the alternatives for regions where coal has become so economically dominant. There are so many opportunities for Queensland to move forward. We have a growing population, diverse people and cultures, abundant natural resources that have the potential to be used sustainably and we are so close to the new epicentre of change in the world in Asia.  One finds it hard to imagine how the many social and economic opportunities our state has available to us can be ignored; how some leaders can still be so fixed in their intent to indefinitely expand the coal mining industry when it is so clear the people of Queensland, the people of Australia and the world wants to move forward. This report is about the people of Queensland taking the initiative to communicate a positive new vision of what our future economy and the journey to arrive there can look like. It is the beginning of a new chapter in the conversation about coal that has been getting closer and closer to being opened as more people realise the devastating impacts the industry is having.  Most of all this report is about justice, not just for the planet, but for workers and citizens who have done nothing wrong to work in the coal industry. It is about justice for workers who have been supporting our economy, supporting our towns, our clubs and being part of our community. Finally, it is about justice for the families in mining communities who deserve the support to help them plan their future beyond coal. It is the government and it is the mining corporations that have allowed these communities to be placed in an increasingly risky situation. However it is the responsibility of all of us to help them out of it and it is now time to take that responsibility. Drew Hutton President of the Lock the Gate Alliance
  • 6. iv  |  JOBS AFTER COAL: A Just Transition for Queensland Executive summary This report is calling for a Just Transition for coal communities in Queensland. The term is not well known in common Australian political rhetoric. The ‘Just Transition’ term in this report is defined as a transition that supports environmental policies with a fair distribution of the costs and benefits across the economy, and that support the creation of opportunities for active engagement by those affected to determine the future wellbeing of themselves and their families. There is substantial international literature on the concept of a Just Transition. Reports by and for Australian, Canadian and South African unions are just a sample of the literature diversity. Many organisations, by way of example, the Organisation for Economic Development and Cooperation, the United Nations Environment Program, the International Labour Organisation, the United Nations Framework Convention on Climate Change and the World Wildlife Fund have produced literature on the matter. All over the world, where communities have been largely dependent on a single, unsustainable industry they have, throughout history, been forced to transition. Sometimes this is sudden, unplanned and involves considerable pain. Most of which is felt by people working in those industries. This, unfortunately, has been the experience so far in Central Queensland with numerous mining companies cutting costs and forcing redundancies that have caused families to leave the region. The volatility of the Queensland coal industry has not been managed well by our either colluding or timid state governments, depending on which party is in power. Around the world there are stories we can look towards to find inspiration. Some communities, have reinvented themselves, creating new industries and jobs, minimising the impacts on local people and establishing stronger local economies. We discuss some case studies in the report of communities which have achieved some impressive results. Inspiration can be found in the U.K and South African movements to create One Million Climate Jobs (Jobs, 2015). Trade Unions have united with environmental organisations, academics and other civil society groups to write a blueprint for the creation and financing of 1 million low carbon long-term jobs in each country. Some of these initiatives include jobs in public transport, in energy and in housing and jobs to localise and secure food supply and protect water resources (Change, 2010). The market is telling us that coal is an energy source in decline. Renewable energy investment is skyrocketing, air pollution controls are being stepped up around the globe and countries are preparing for much stronger action on climate change. As a major carbon exporting country, Australia is in serious economic risk of being caught in the midst of a rapidly hastening global energy transition. Australia must develop energy and climate strategies that are more in tune with international developments and capture the economic opportunities to transition away from fossil fuels and towards renewable energy. To do this we need strong leadership from the business sector, our communities and, because of the speed and resources that will be required in this transition, our governments.
  • 7. JOBS AFTER COAL: A Just Transition for Queensland  |  v The Queensland government is under pressure from mining corporations and other stakeholders to keep the coal industry going strong. Faced with the challenge of creating an economic vision beyond coal, our political leaders have chosen for too long to capitulate to this pressure. The coal industry is in denial about its terminal decline. The question community members are left to ponder is if the industry knew its days were counted, would it still try and squeeze as much support out of the government as possible? To try to make as many subsidised profits as it can before throwing in the towel? We can’t wait and risk the livelihoods of citizens in coal communities to find out. The alternative for the people of Queensland and the Government is to admit that the decline is terminal and stop delaying the re-orientation of policy and the economy to support sustainable industries. Challenges faced by the different mining industry towns are quite different from one another. As such, the planning of a just transition requires a diverse and adaptative strategic approach. For example, the challenges the mining industry towns of Mackay and Rockhampton are facing are substantially different than the ones the specifically mining operation towns of Moranbah and Blackwater are facing. Different regions with different levels of economic dependency on coal will require unique transitionary solutions and strategies. These different approaches needed are best understood by and will require leadership from the local community to have the best chances of success. The economic and geographical difference between thermal and coking coal operations is another significant complexity. Often both coal types will be referred to as one homogenous industry by the media and politicians. This misguided referencing makes having a discussion about the different futures for each industry difficult. Coking coal has a substantially different outlook to thermal coal and needs to be discussed and considered separately. Policy supporting a just transition needs to carefully consider their uniqueness and the implications this has for planning support, resources and initiatives in different coal regions where each type of coal has a different level of operational and economic intensity. The political conversation about a Just Transition has only just started to emerge. Rumblings and whispers of the actions and policies necessary within the environment and labour movements have been building momentum. Policies are being discussed and cooperatives are being launched throughout Australia’s coal communities. Significantly, this issue is building important relationships between environment groups and labour unions that have complimentary objectives within the Just Transition framework. Their collaborations are building a stronger and more cooperative civil society and strengthening the fabric of our democracy. It is hoped that this report will help contribute to this momentum so that some tangible and clear actions are seen in the very near future.
  • 8. vi  |  JOBS AFTER COAL: A Just Transition for Queensland Key recommendations for the State Government of Queensland 1 Establishing a unit within the State Government to support coal mining regions to transition to new economies The unit would: • Work on the ground in coal mining communities to bring government expertise into regional entities. • Analyse barriers to the creation of competitive advantages for alternative sustainable industries. • Identify actions the State Government can take to support sustainable industries. • Provide research funding to that prioritises low carbon technologies and industry sectors with increased triple bottom line sustainability potential. 2 Support community leadership in diversifying local economies through the establishment of democratic regional entities that: • Lead in the development of their communities’ transition strategies. • Researching the transition opportunities and pathways for the community. • Planning and initiating re-training programs for workers from affected industries. • Facilitate support programs for new businesses, cooperatives and social enterprises based on the needs and strategies of communities. • To take stock of the existing resources, skills, and successful businesses, on which a new future can be built. • Run an analysis of the social, environmental, and economic needs of the community. • Establish economic diversification projects, including value-added local production, worker controlled co-operative enterprises, and new community-based enterprises. • Work in collaboration with regional councils and economic development organisations. 3 Support researching and communicating how the just transition can take place • Providing regular academic standard situational analysis of the global energy markets shifts to keep the public informed about energy market trajectories. • Support regional entities to research the number of jobs that are dependent on coal, the skills of those employed, the level of local, national, and global long- and short-term risk to local mining operations, the transferability of jobs to other industries, local opportunities for new enterprises and their needs, and the local educational and training needs and resources. • Researching how the transition scenarios could differ depending on the level and relativity of thermal and coking coal industries across coal mining communities.
  • 9. JOBS AFTER COAL: A Just Transition for Queensland  |  vii 4 Convene a just transitions state economic summit to identify socially and environmentally sustainable economic opportunities in mining communities • Develop a plan to grow competitive advantage across industries that have potential for sustainability and growth in regional mining communities. • Organise a State Economic Summit to assess existing industry clusters; identify the potential of new and emerging industries; consider their competitiveness and key capabilities; and identify barriers to increasing competitive advantage. 5 Provide social protection of workers, their families, and incomes • Create individual mine employment transition plans in cooperation with mining companies and local communities ready for when mines cease operating. • Penalising mining companies that do not give adequate notice of their closure or restructuring. • Subsidising workers at a full living income level for a maximum of four years who do not have adequate employment available to them at the time of redundancy to undertake training for careers that support the establishment of the new economy in their community. 6 Supporting Unions to play leadership roles in social dialogues and to lead worker engagement • Support and finance Unions to play facilitating roles in community transitions. • Engage Unions to: -- Provide career planning and advice. -- Negotiate preferential hiring for displaced workers in the new, alternative emerging industries. -- Lead the establishment of work controlled cooperatives. 7 Provide training opportunities for coal workers and communities • Mandating coal mining companies to fund education and training for their workers that give them skills for other industries. • Funding training programs to assist retrenched workers from the coal industry to attain continued retraining and re-education.
  • 10. viii  |  JOBS AFTER COAL: A Just Transition for Queensland 8 Mandate adequate security deposits and progressive signoff for best practice mine site rehabilitation • Bringing mine site rehabilitation standards in Queensland to global best practice. • Mandate that mine sales are not made to companies without adequate capital to properly rehabilitate the mine site. • Increasing mining security deposits to ensure that the full cost of third party mine site rehabilitation is progressively implemented and signed off by governments throughout the life of the mine. • Ban the sale of mines where rehabilitation responsibilities are not complete or behind schedule. • Support the nationally coordinated implementation of the AusIMM Abandoned Mines policy statement that includes the actions described above and more detailed policy changes. 9 Remove all subsidies and tax payer funded support to coal mining • Review and remove all hidden subsidies to the coal industry within the state government. 10 Sound investment and resource revenue management • Commission an economic assessment of the possible economic mechanisms and changes to existing policies that could fund the above measures to the extent that will be necessary. • Set aside a percentage of coal royalties for funding the diversification of coal mining regions.
  • 11. JOBS AFTER COAL: A Just Transition for Queensland  |  1 1. Coal’s current role in the Queensland economy Coal in the Queensland economy Over the last 30 years, the Queensland coal industry has grown substantially to become a significant part of the Queensland economy and create employment in many regional areas. The industry has been concentrated in the Bowen and Surat Basins throughout rural western and central Queensland. The boom for the industry began in 2005–2006, when prices for coal rose by around 400% causing massive industry profits in the 2000s (Stanford, 2014). Prices have fallen dramatically since the flow on effects of the global financial crisis (GFC) slowed down China’s growth in 2011–2012. However prices have remained much higher than the below US$40/tonne that was averaged through the 90s and earlier (Quandl.com, 2015). Queensland coal train
  • 12. 2  |  JOBS AFTER COAL: A Just Transition for Queensland Over the last five years since the GFC and later slow down in coal demand, the total Queensland coal production has, after decades of growth, levelled off at just over 200 million tonnes per annum (Figure 1). 0 50 100 150 200 250 2008–09 2009–10 2010–11 2011–12 2012–13 Milliontonnes Figure 1: Queensland Coal Production 2008–09 to 2012–13 Source: Queensland Department of Natural Resources and Mines (2014) Queensland Coal Industry 5 Year Summary 2012–13 Queensland uses 20 to 25 million tonnes of its mined coal for electricity generation each year (Government, 2014). But the rest, which is 85 to 90% of the mined coal, is exported to countries all over the world and mainly to Asia. In 2013–14, 33% of the production was thermal coal and 67% was for coking coal production to make steel (Table 1). Both thermal and coking coal create greenhouse gas emissions when they are burnt. However, contrary to government and media perceptions, the coal industry is not the sole driving force behind the Queensland economy. As in most modern economies the service industry dominates with 60% of economic output, followed by the construction industry with 10%, manufacturing at 7% and agriculture, forestry, and fishing at 3% (ABS, 2014). An overview of the Queensland coal industry would not be complete without an examination of its level of foreign ownership. By volume, 80% of Queensland’s coal production is foreign owned (Government, 2013). This means that a majority of the profits from the operations of these companies are being directed out of Australia to international shareholders.
  • 13. JOBS AFTER COAL: A Just Transition for Queensland  |  3 Table 1: Queensland Coal Mining Areas, Production and Types 2009–10 to 2013–14 2009–2010 2010–2011 2011–2012 2012–2013 2013–2014 Mines operating   56   57   58   59   59 Saleable production Open-cut Northern 76 450 64 167 62 632 71 268 78 953 Central 63 319 52 637 56 032 63 871 73 801 Southern 39 339 37 423 45 010 43 709 43 651 Total (mt) 179 108 154 227 163 674 178 848 196 405 Underground Northern 7 642 8 965 9 492 13 266 11 470 Central 18 968 16 642 15 082 14 511 18 433 Total (mt) 26 611 25 606 24 574 27 776 29 903 Coking coal total 125 178 108 731 117 000 131 328 151 571 Thermal coal total 80 540 71 103 71 247 75 296 74 737 State total 205 719 179 834 188 247 206 624 226 309 Source: Queensland Department of Natural Resources and Mines (2014) Queensland Coal Industry 5 Year Summary 2012–13 Abbot Point
  • 14. 4  |  JOBS AFTER COAL: A Just Transition for Queensland Revenue and economic activity generated by the coal Industry As a nation, the coal industry is Australia’s second largest export earner after the iron ore industry. Last year, it generated $40 billion which equal to about 12% of export revenue (Cleary, 2015). The coal industry in Queensland will pay around $2 billion which amounts to 80% of total mining royalties to the state Government in 2014–15 (Campbell, 2014). Coal royalties represent around 4% of Queensland Government revenue (Vorrath, 2014). Similar amounts come from vehicle registrations and interests on funds saved for superannuation, in addition to long service leave entitlements, as shown in Figure 2. Such figures are not large in the financial context of running a state government. Despite this, the taxation contribution of coal is incorrectly perceived as significant. The large revenues derived from coal exports is due to the massive volumes the industry has reached in recent years. Total revenue to the coal industry from its mining operations amounts to approximately $25 billion per year that is added to the economy. This is a significant contribution to Queensland’s economy, but one that needs to be viewed relative to the size of the economy. Queensland’s economy produced output worth $290 billion in 2012–13, meaning the coal sector accounted for around 7% of production by value, as shown in Figure 3 (right). Commonwealth grants Other state revenue MV registration 3% 48% 40% 5% 4%Interest Coal royalties Figure 2: Queensland State Government Revenue Sources Source: Queensland Treasury (2014) Queensland State Budget 2014–15 Paper 2 Non-mining Other 2% 91% 7% Coal Figure 3: Queensland gross state product, coal, other mining and non-mining sectors 2012–13 Source: ABS (2013) Catalogue 52200 Australian National Accounts: State Accounts Coal industry jobs and their locations There has been much debate recently as to the exact number of people employed by the coal mining industry. Industry figures have been disputed because of the industry’s continual representation and communication of construction jobs as if they were permanent. In addition, the industry conspicuously classifies indirect growth in employment within the local economy as jobs that mining development is responsible for creating. Although in regional mining communities mining employment is high, it is relatively small on a statewide
  • 15. JOBS AFTER COAL: A Just Transition for Queensland  |  5 level. Most recently the industry’s employment claims were revealed again, in the Australian Land Court case regarding coal mining development by Indian mining company Adani in the Galilee Basin, to have been exaggerated (Cox, 2015). Adani’s mine proposal cited the figure of 10,000 jobs attached to its development application, but the court was told by Adani’s own expert witness that the mine development would only create 1,464 actual jobs throughout the ongoing operation of the mine (Branco, 2015). According to research by The Australia Institute, a majority of Queenslanders believe that the mining industry employs ten times the amount of people it actually does (Campbell, 2014). In reality, the report shows that the coal industry only employs 1.2% of the Queensland workforce (Vorrath, 2014). What is significant is how this employee population is regionally distributed, with a majority of the employees residing in the Central Highlands, Isaac, and Mackay Regional Council areas (Figure 4). 0 5000 10000 15000 20000 25000 30000 W hitsunday Sunshine Coast Banana Rockham pton Brisbane CentralH ighlands Isaac M ackay Total Employment Figure 4: Coal jobs by Local Government Area (LGA) in Queensland: Top 8 Source: ABS 2011 Census. Coal mining jobs by region in Queensland Summary The coal industry plays a significant role in the Queensland economy, but it is by no means irreplaceable. As the next section will show, the coal industry has fallen from the lofty heights of its unprecedented profitability and aggressive hunger for expansion. It has come to a slower pace, but due to the forecasted change expected to affect the industry, a new approach to planning local economies beyond coal is required.
  • 16. 6  |  JOBS AFTER COAL: A Just Transition for Queensland 2. The drivers of change in the coal industry Drivers of change The global energy market is in a period of dynamic long-term structural change that will have ongoing repercussions for energy exporting countries such as Australia. Over the last ten years, the expansion in gas, the decrease in renewable energy prices, the increasing of capital infrastructure costs, the demand for cleaner energy and energy efficiency have all dramatically changed the nature of the global energy economy (Ben Caldecott, 2014). Coal has been the energy source that has made so many technological advancements through history possible. Although, there has been many struggles and social costs along the way. The communities, workers and companies that made this progress possible have substantially contributed to the creation of the modern world. Though, if there is one thing we know from history it is that empires rise and fall. The coal empire is crumbling. As it crumbles it is creating unnecessary instability, stress and hardship on communities. In communities like Mackay, where income has dropped by 30–40%, as many other small mining towns, people and businesses have been caught culturally and economically unprepared for this economic shift (Bleby, 2013). Windmill and wind farm
  • 17. JOBS AFTER COAL: A Just Transition for Queensland  |  7 It is clear that coal, thermal coal especially, is no longer good for humanity despite our former Prime Minister, Tony Abbott’s fervent belief that it is (Online, 2014). WA Premier Colin Barnett heralded last year in his declaration that coal is in ‘structural decline’ (Burrell, 2014). He was not wrong. In the past 5 years alone the Dow Jones Total Coal Market index has fallen by 76% (Baker, 2014). The reality is that the world is rapidly shifting away from fossil fuels, including countries that are key importers of Australia’s coal and gas. China, India, Japan, and South Korea import over 80% of Australia’s export market for coal and gas. The reality is that these countries have recently either announced policies to shift away from these fuels, and/or initiatives to drastically enhance renewable energy and energy efficiency (“Politics of Climate Change in Asia”, 2015). The following section of the report analyses the risk of Australia not being prepared economically for changes that are already taking place. As a country and a state, our governing political parties continue to pursue a strategy that assumes our short and long term economic prosperity is dependent on mining. Few of our political leaders are attempting to communicate an economic vision free from the inevitable boom-bust cycles created by extracting emissions-intensive resources. It is also a strategy that assumes energy production and distribution will continue on as a very centralised process, rather than following the great trend of networked and decentralised distribution that is shaping the 21st century (Riftkin, 2015). This strategy is short-sighted given recent announcements by China and India to phase out fossil fuels and move rapidly towards cleaner and more distributed energy sources (Rohr, 2014). The international coal price The majority of Queensland’s export coal mining industry is dependent on demand for steel making from the world’s coking or metallurgical coal market. This is a market that has been severely impacted by a combination of actions in China, the biggest steel manufacturer in the world. Primarily, China’s housing boom has been slowing down over recent years; this, in turn, has massively reduced the need for steel. Most importantly China is also running a “war on pollution” that is having direct short- and long-term impacts on the viability of the coal industry as a whole. This has resulted in a campaign of state enforced closures of coal plants and steel mills, especially near the country’s big industrial coastal cities (Ng, 2015). Prices on the international coking coal stock market have plummeted from the all time high of US$330/ tonne in late 2011, to a sobering low of US$109/tonne in the first quarter of 2015. The outlook still remains gloomy for the coal sector. With the continued slowdown in the global and Chinese economies, the price of iron ore has also collapsed. Prices have dropped by one third in the first quarter of 2015 alone, causing at least one Australian mine to close operations and many others to cancel plans for expansions (Sandersen, 2015). Iron ore is closely linked to the sales of coking coal, which is used most commonly to melt iron ore into steel.
  • 18. 8  |  JOBS AFTER COAL: A Just Transition for Queensland 2014US$/t 0 100 200 300 400 2005 2007 high quality high coking semi-soft coking 2009 2011 2013 2015 Figure 5: Coking Coal Prices 2005–2015 (worldcoal.com) A similar price drop has hit thermal coal used in coal-fired power stations. Thermal coal is mined in many Surat Basin mines and is also found in some Bowen Basin mines, where it is an addition to the high quality coking coal found in the area. Significantly, the proposed mining development in the Galilee Basin is only for thermal coal which, at a time when coal-fired power stations are being replaced by cleaner options, is alarming (Pacific, 2012). Thermal coal was priced at US$120/tonne in late 2011. It had plunged to US$73 per tonne by February 2015 and has remained below US$60/tonne since May 2015. China’s new rules of cutting ash and sulphur content in seaborne coal imports, along with increasing tariffs on coal imports, has meant that even Shenhua, China’s biggest coal company, cut coal imports in early 2015 (Jenda, 2015). Overall, Chinese consumption dipped by 1.6% in 2014 despite their economic growth of 7.3%. The decade of relentless and largely unplanned investment in Queensland coal mining in times of high prices led to a massive oversupply against a background of decreasing demand. The state and federal governments failed to slow the industry down so that it did not overshoot an economically sustainable size. This has made the challenge of transitioning out of the industry even harder, along with magnifying the pain now faced by many mining towns (Neubauer, 2015). All of this leaves a million-dollar question: Is the downshift in [coal] demand terminal? According to Richard Gibbs from the Macquarie Bank, it certainly is (Neubauer, 2015). The global coal market is also experiencing competition from renewables and shale gas, slow growth and government policies, which are, in part, driven by the threat of climate change. The growing competition from renewable energy sources has been increasing its impact on the coal industry by slowly but steadily eroding profits of domestic coal power stations—and thus demand for coal—across the country (Hewson, 2015). In Queensland the state government should be applauded for its 50% renewable energy target by 2030 which will further add strain to struggling coal power generators (Parkinson, 2015). A more than 50% decline in coal prices has seen most listed coal companies globally to lose 80–90% of their equity market value in the last four years (Buckley, 2014). In 2014 the world added more energy generation capacity from wind power than from coal. Overall, Europe and America have already cut coal-fired generation
  • 19. JOBS AFTER COAL: A Just Transition for Queensland  |  9 capacity by over a fifth in a decade. The sun will undoubtedly rise even further for renewable energy in 2015, but for coal, there remains a lot further to fall,” said a report by the Institute for Energy Economics and Financial Analysis in January 2015 (Buckley, 2015a). This statement is borne out by the facts: • In 2014 new global wind installations grew 40% to 46GW, led by China and America (Buckley, 2015b). • In 2014 the US solar installation sector created almost 50% more jobs than the oil and gas pipeline construction industry (Foundation, 2015). • From 2000 to 2011, global annual growth in the yearly global installation rate of photovoltaic solar panels was 40%. In 2011, the total amount of global PV capacity installed was 27GW, an astonishing 60% growth on 2010 levels (Green, 2012). • Unsubsidised renewable energy is now cheaper than new coal-fired power in Australia (Paton, 2013). Solar installation
  • 20. 10  |  JOBS AFTER COAL: A Just Transition for Queensland International mining companies It is not just in Australia that coal mining jobs are being lost. Internationally, the picture is very similar— the global coal industry is being hit hard and jobs overseas are also being lost. Rather than just wait for continued disruptive innovation, along with human and environmentally-oriented policy shifts to drive them to bankruptcy, the world’s biggest coal companies are restructuring. A good example is the German energy giant, E.On. The company has stakes in all forms of energy from coal to gas, nuclear and renewables. In December 2014, the company announced that it wants to focus on renewable energy and has parcelled all of its fossil fuel interests into a separate company to avoid the risk to its primary growth-driving renewable energy company (Hope, 2014). Mining giant Rio Tinto has also signalled a move away from coal mining. It has done this by separating its coal assets into a different company. Along with BHP Billiton, who have halved their coal use, both mining companies have sold off many of their thermal coal mining operations in Australia and globally (Buckley, 2015c). In the US, the birthplace of many new technologies, the coal industry is in free-fall like nowhere else. A massive expansion in shale gas has shifted energy production towards gas leaving the domestic consumption oriented coal industry stranded(Mathieson, 2015). This has caused historically major mining companies, Arch Coal and Peabody, to lose massive value resulting in lower share prices than seen for decades. Like dedicated Australian coal miners Whitehaven Coal and Newhope Coal, neither of these companies have anywhere to go. They are run purely on coal. They do not have the diversification options that E.On and BHP have available to them. Coal power station
  • 21. JOBS AFTER COAL: A Just Transition for Queensland  |  11 The outlook for coal prices While some consider the outlook for coal prices as cyclical in nature and that a turnaround will increases prices for coal, other analysts believe this downward trend, based on policies, health impacts and concern about global warming is here to stay. Financial reports from the major mining companies in Australia paint a grim outlook for global metallurgical coal prices. China was once the great hope for coking coal exporters, but BHP Billiton’s metallurgical coal market outlook (May 2013) indicated a flattening demand into the future (Billiton, 2013; Rohr, 2014). BHP Billiton has warned that the increased usage of scrap metal in furnaces would result in lower growth in demand for pig iron, while greater production from electric arc furnaces—which use little or no coking coal— are expected to “contribute a significant share of total Chinese steel production by 2030”. Although coking coal will likely remain necessary for steel production for some time, as renewable energy sources grow, the efficiency and lower emissions intensity of electric arc furnaces will help them to outcompete coking coal in the not too distant future. Some experts even predict another technology called ‘direct reduced iron’ that uses gas to make steel could make coking coal redundant within a decade (Macleod, 2013). It is not just China; BHP Billiton also cautions that the Indian steel outlook is less certain as steel production growth has been slower than expected. Prices for commodities from iron ore to coal are sinking, as China’s leadership tries to steer the economy away from debt-fueled property investment and smokestack industries, embracing services and domestic-led consumption. At the same time, President Xi Jinping is stepping up efforts to combat pollution. The provincial government of Beijing and a number of other major cities have made plans to ban coal use by 2020, further putting the squeeze on all types of heavy industry (Coulter, 2015). However, the outlook is not all dismal for coal everywhere. In India, demand is expected to continue to rise without peaking until the 2030s. India’s government predicts a 19% rise in coal imports this year, which may offer very short-term opportunities for Australian miners. The opportunities are short term because these import increases are something the Indian government has indicated it does not want continued into the future. India’s plan is to ramp up renewable energy technology, as well as develop their untapped coal fields to support a gradual phase out of thermal-coal imports within the next 2–3 years (Baker, 2014). Regardless the Indian mining giant Adani still hopes it can get coal from its proposed Carmichael mine in the Galilee Basin and export it to India for the duration of its 60 year life span. After a number of international banks have ruled out funding for the Carmichael coal mine, Adani has been looking for cash handouts from the Australian Government to fund its shaky proposal. However, sanity has prevailed and these have been ruled out by the new Prime Minister (Edis, 2015). It is clear the Indian government’s plan for India’s future coal supply sources does not involve Australian coal.
  • 22. 12  |  JOBS AFTER COAL: A Just Transition for Queensland This is the marketplace in which Australia’s exported coal competes and this is the marketplace that holds the livelihoods of workers and communities in its hands. The current state and future outlook of the coal industry suggests that it would be risky not to scale down the thermal coal industry and at least restrict any new mine expansions in the coking coal sector. There are those who remain positive about the industry’s future but, recent events in the coal industry and uncertainty over medium and long term suggest that there are better industries to back. Behind these diverse risks threatening the coal industry is the inescapable scientific fact that we cannot afford to burn any more coal from new coal mines if we want to decrease the risk of our already fifty fifty chance of avoiding the worst impacts of global warming (IPCC, 2013). If we wanted to try and remove the total risk of runaway climate change we could not even afford to burn the coal that are sitting in trucks, on trains, at port yards and in ships. Not even the coal travelling on conveyors into power station furnaces about to be burnt right this very moment. The carbon bubble From the South Sea Bubble, as well as the housing and dot.com bubbles of the last decade, periodic over- investment has been made into sectors deemed too important to fail. The rush and hubris of investors seeking incomparable profits to finance such industries has led to speculative bubbles of over-estimated value that eventually burst. In the economic fallout that results, working people carry the burden, while the speculators and profiteers generally are not held accountable. Another speculative bubble has formed, and it dwarfs the size of all of the bubbles that have come before it. It is called the Carbon Bubble (Tracker, 2015). One of the few things world leaders agreed upon at the Copenhagen climate talks was that the Earth needs to stay below 2°C warming to minimize the risk of runaway climate change: • If we are to avoid going over 2°C, we can emit only 565 more gigatonnes of carbon dioxide (IPCC, 2007). • Burning the fossil fuel that corporations now have in their reserves would result in emitting 2,795 gigatonnes of carbon dioxide—five times the safe amount (Leaton, 2013). The Intergovernmental Panel on Climate Change has now produced its own carbon budget. They have calculated that if we continue pumping carbon into the atmosphere at today’s rate, this budget will be exhausted within 15–25 years (IPCC, 2013). This means there will be growing political pressure on the fossil fuel industry to keep most of its reserves in the ground. That pressure has already begun around the world. Citizens are pressing their superannuation funds, councils, banks, universities, and other institutions, to divest from fossil fuels with growing success. The year 2013 saw several major financial institutions recognise the financial and ethical implications of continuing to finance fossil fuels, with Norwegian Storebrand, Rabobank, and the World Bank among those who made major announcements on divestment or cutting loans. In 2014, major institutions including Stanford University, the Australian National University and Oxford University, have divested their fossil fuel funds (Advisors, 2015). So far in 2015, local councils in Australia such as Moreland, Newcastle, Byron Bay, Melbourne, and many more have also divested (Ryan, 2015). Divestment is now going mainstream and will have increasing impacts on fossil fuel company shares into the future.
  • 23. JOBS AFTER COAL: A Just Transition for Queensland  |  13 As a result of the momentum of the global divestment movement international stock exchanges are creating new indexes to exclude fossil fuels in preparation of the impending seismic shift in global finances. In late April 2014, the world’s largest fund manager, Blackrock, joined with the FTSE Group in London to create a new index. The ex-Fossil Fuels Index Series is an innovative set of benchmark indices that excludes companies directly engaged in extracting so-called “stranded assets” in the hydrocarbons industry. “This is one of the fastest-moving debates I think I’ve seen in my 30 years in markets,” FTSE managing director, Kevin Bourne, told the Financial Times (Clarke, 2014). The Bank of England is now investigating its exposure to risk from its fossil fuel investments. To top that off, the world’s biggest sovereign wealth investment fund in Norway has recently dumped coal investments (Carrington, 2015). The largest contribution to climate change from the fossil fuels in company inventories at present is from coal. Because it has the largest climate impact per unit of useful energy, it is being targeted for early phase out. The book value of fossil fuel companies is determined not only by their current infrastructure and deposits undergoing extraction, but also by the size of their legally claimed reserves. Because the book value of so many companies has greatly exceeded their realisable value as emissions restrictions come into place, a speculative bubble has formed. Unfortunately, bubbles usually burst in the end, leaving behind stranded assets and stranded capital—and leaving workers in the lurch. The only alternative is a mature and planned phase out of the industry that slowly devalues and deregisters fossil fuel reserves at a pace that does not lead to financial crisis. A planned phase out that gives time for just employment transitions for fossil fuel communities. 500 1000 886 565 1500 2000 2500 3000 already burnt remaining 2000–2050 2011–2050 Coal 2˚Global carbon budget Oil Gas GtCO2 Global fossilfuelreserves Figure 6: Carbontracker 2012 report: The Carbon Bubble
  • 24. 14  |  JOBS AFTER COAL: A Just Transition for Queensland In 2013, the report Unburnable Carbon highlighted that: “Company valuation and credit ratings methodologies do not typically inform investors about their exposure to these stranded assets” (Leaton, 2013). This is very troubling when considering that the supporting share value of these reserves was $4 trillion in 2012, and that they serviced $1.27 trillion in outstanding corporate debt over the same period. We need to challenge these methodologies (Tracker, 2015). In a move that signals a step towards the solutions required, the World Bank, the European Investment Bank and the US Export-Import Bank have all announced that they will not fund further coal-fired power plants except in exceptional circumstances. As changes in policy by the major coal consumers, the uptake of renewables and the need to stay within the global carbon budget begin to bite, it is high-cost producers who will be squeezed first. Australia is considered a high-cost producer because of our strong industrial relations and wage laws which makes it all the more necessary that our governments are vigilant and prepared for impending macroeconomic change (Cleary, 2015). Summary This is the environment in which the Australian coal industry finds itself. Internationally, coal is no longer looking like a safe long-term investment within the context of the rapid changes afoot in the world. The coal industry leaders are either in denial about their industry’s future or are determined to squeeze as much profit as possible until the cost gets worn by workers and their communities (Saunders, 2015). The issues of climate change demands for cleaner air and more efficient new technologies. The realities of the market are revealing coal as the sunset industry it really is. This is not an industry Queenslanders can rely on to create a stable, resilient, and sustainable economy. It cannot be relied upon for future wealth and future jobs. We have been warned by the UN Climate Change Secretariat’s Executive Secretary that the diversification and a managed transition away from coal is what we need to do and we need to heed this warning (Australian, 2015).
  • 25. JOBS AFTER COAL: A Just Transition for Queensland  |  15 3. Assessing some of the economic opportunities in mining regions Introduction The great state of Queensland is endowed with sustainable human and environmental resources that have the potential, if we choose to harness it, to drive a balanced, diverse, and resilient economy for generations to come. Diversifying Queensland’s economy to create sensible and stable prosperity beyond the boom and bust vagaries of the mining industry must be a key objective of the Queensland Government. The Newman LNP Government’s Queensland Plan headline was ‘forging diversity and prosperity’ (Government, 2014). But throughout Newman’s reign as premier, no action was taken. Under the new Palaszczuk Labor Government, there has been some effort to support economic diversification across the state. This is insufficient because as of yet, nothing has been done to adequately fund, facilitate and empower the actual communities where mining takes place. The grassroots Labour Environmental Action Network, an organisation within the Australian Labour Party has called for change. At the 2015 Queensland ALP State Conference, they put forward a motion that was passed calling on the state government to prepare a just transition policy before the next conference (ALP, 2015). Grain harvest
  • 26. 16  |  JOBS AFTER COAL: A Just Transition for Queensland Most importantly, both major parties have continued their relentless support for further coal mine expansions that inherently suffocate the process of diversification. With the coal industry forecast to be in a ‘structural decline’ by political leaders and bankers alike, it is now essential that the focus for economic development be on industries that can bring sustainable prosperity to Queensland (Burrell, 2014; Robins, 2014). In the United Kingdom under Prime Minister Thatcher the world witnessed the consequences of industries closing without planning and without investment to transition local communities and industries. The following section of the report outlines how the opportunities for sustainable economic development are already known. Queensland has well-established sectors with bountiful potential in agriculture, tourism, manufacturing, and education. It also has the opportunity to capitalise on a boom in renewable energy and bio-industrial products to create more sustainable economic sectors. These industries are ready to fill the void that will be, and is being, left by coal; however, they lack the support needed to ensure their presence in mining communities to provide a just transition away from coal where it is most needed. Agriculture and aquaculture Currently the Queensland agricultural sector is worth near $14.7 billion and employs over 90,000 people (Queensland Government, 2012). The sector has the potential to massively expand its food exports to Asia as population and economic growth continue to surge in the dynamic economic region. Through the competitive advantage of our proximity to Asia and high-quality produce capabilities, agricultural products have become Queensland’s second largest export earner and have the potential for continued growth (Heath, 2014). By increasing availability of farming technology, driving productivity, minimising costs, and focusing on profitable premium produce markets, the Queensland Agricultural Strategy (2012) aims to double the total value of production for all agricultural commodities by 2040. With innovative new farming approaches and ecosystem system management strategies such increases in production are possible in a way which sustainably manages and regenerates the land. To reduce pressure on fish stocks from home and abroad the promotion of aquaculture could be further encouraged across the state. This industry is worth $10 Million a year (Lucas, DLGP, 2011). At present there are several sites located along the coast, however research conducted over the last decade has identified future sites for land based aquaculture. Industry consultation, aquaculture management training programs and related issues in developing a workforce need to be considered (Plan., 2012). The Queensland Aquaculture Industry Federation sees the need for continued collaboration between government and other stakeholders in order for this industry to reach its’ potential as a strong core industry (Federation, 2015). The Department of Employment, Economic Development and Innovation is leading the government drive to
  • 27. JOBS AFTER COAL: A Just Transition for Queensland  |  17 develop the aquaculture industry. This could see a future where aquaculture goes further than just meeting domestic demand, and grow to cater for high value export markets (Lucas, DLGP, 2011). New opportunities in animal genetics, aquaculture, horticulture, and bio-processing are driving agriculture and aquaculture sector growth in new directions. Both industries are about creating intergenerational economic sustainability. Choosing these industries that have unlimited potential to sustain our communities and our ecosystems over mining is choosing long-term jobs over short-term jobs that cannot be passed on to the next generation. The bottom line is that we live in a hungry world and Queensland is well placed to be a reliable and sustainable source of food to other nations without the agricultural potential we are endowed with (Government, 2014). Tourism and recreational fishing Despite setbacks due to the high Australian dollar and loss of skilled workers to the mining boom, the tourism industry is still a critical part of the Queensland economy with massive future potential (Dr Tien Duc Pham, 2015). The tourism industry made a significant employment contribution providing 124,000 jobs in 2010–11, with steady growth in international visitor nights (Deloitte Access Economics, 2012). Queensland has the potential to become a global leader in tourism and ecotourism and by doing so to create more jobs and revenue (Government, 2014). This will be possible, similarly as in agriculture, by promoting the experiences available in our natural places and the quality hospitality we can provide to the growing Asian middle class (Wilson, 2013). The Chinese tourism market is seeking clean, fresh, and new experiences that Queensland can cater to and is expected to be worth $7.4 billion by 2020 (Guterres, 2014). Significant to Queensland’s potential in tourism is our ability to expand the tourism industry in the authentically Australian rural and stunningly beautiful coastal mining communities where new economic activities are most needed. Further mining expansion in such places threatens to do to tourism what the growth in heavy industry did to Gladstone’s economic diversity, where fishing and tourism are now non-existent. Although sustainably managed fisheries have the potential to provide continued economic prosperity to Queensland there lies a major opportunity in net free fisheries to develop as tourism industries specifically in coal mining regions. A great recent example of this taking place is the newly established Net Free Zone between from the Northern end of St Helens beach to Cape Hillsborough (Spelitis, 2015). Along with three other net free zones across the state the extent of the cumulative commercial opportunities for sustainable tourism the net free zones have created has made it one of the three pillars as part of the 2020 vision for the Queensland has the opportunity to develop an abundant and resilient agricultural industry that supports the transition to sustainable prosperity.
  • 28. 18  |  JOBS AFTER COAL: A Just Transition for Queensland Queensland Tourism Industry Council (Council, 2015). The Mackay, Isaac and Whitsunday (MIW) coal mining region has excellent accessibility to a variety of fishing pursuits. In addition to the new net free zone ther are five fresh water stocked impoundment fisheries creating opportunities to promote lake, beach, offshore and deepwater angling. Improvement of accommodation facilities, quality of jetties, access roads and coordinating fish trails with regional events could maximise visitation from recreational and tourism markets (Mackay Tourism, Tourism Queensland, 2012). Charter fishing operatiors, tackle stores, campsites, motels, boat sales, boat building and maintenance all have the opportunity of benefitted from growth from the recreational fishing tourism industry (Lucas, DLGP, 2012). Higher education Over the past decade millions of international students have visited Queensland for our quality tertiary institutions and enjoyable lifestyle. International education is Queensland’s biggest service export with nearly $2,431 million being generated in 2013–14 alone (Australian Government, 2014). The majority of Queensland is strategically located in the latitudinal tropical zone where, at a global level, more than 50% of the world’s population is forecasted to live by 2050 (Australian Government, 2015). This makes Queensland’s universities well placed to develop the partnerships and research innovations tailored to the challenges and opportunities of the new tropically-oriented world. This will help Queensland, and especially North Queensland, to attract increasing levels of international students to be part of our high-quality tropical research institutions. These students will increase spending through tourism, support the creation of our own skilled and globally connected workforce and connect Australia to business networks and opportunities across the world. In 2013–14, the Cairns region benefitted to the tune of $137.5 million from international students (McGuiggan, 2014). With the right policies these benefits already being experienced primarily in Cairns, Townsville, and Brisbane, can be spread further across Queensland to make international education a strong economic driver in transitioning mining communities. Bio-industrial products As the world moves away from fossil fuels the demand for cleaner, more sustainable fuel sources will grow (Emissions, 2014). By using excess organic matter produced through food production to develop bio-industrial products, Queensland has the potential to export clean and sustainable fuels and bio-plastic materials to the Tourism is about experiences, not extraction. It has the potential to share Queensland beauty with the rest of the world and create sustainable local economies in the process. Queensland’s greatest resource is the minds of its people. We can share and co-create our innovations and learning with students from all over the world who want to make Queensland the launch pad for their careers.
  • 29. JOBS AFTER COAL: A Just Transition for Queensland  |  19 world for generations to come. This economic opportunity is uniquely important because it is the mining regions that have some of the greatest potential to capitalise on it and create new jobs by doing so. In recent years the bio-plastics sector has grown to make up 10–15% of the global plastics industry. Unfortunately, despite its massive potential, Queensland is still not yet involved in this industry at a significant level (Queensland Government, 2010). This is despite several modeled projects that indicate the potential contribution to Queensland economy is estimated to be $1.8 billion annually creating 6, 640 jobs by 2035 (Deloitte Access Economics, 2014). This is such a potentially lucrative industry that investment to fuel this growth, given the enough initial government support to build momentum, can come from the private sector. The bio masse (feedstock) used to create bio-based products are readily available in the MIW regions. Agricultural bio waste and non food feedstock is an area where MIW can lead internationally, with licensing and technology development, the access to a skilled workforce, research infrastructure, stable government, natural assets, strong regulatory system and close vicinity to Asia being local advantages. The transition from research and development in the laboratory to pilot plants to commercial development is slowly taking place. At the Furfural Plant at the Proserpine Sugar Mill and at the QUT Mackay Renewable Bio-commodities centre pilot plants are in operation (Department of Employment, Economic Development and Innovation, 2010). The bio-technology provides the opportunity to value add to the agricultural and forestry sectors in feedstock supply. Manufacturing nearby full scale plants could potentially benefit in the production of fuel, pharmaceutical and construction products that compliment bio based chemicals and liquids created (Deloitte Access Economics. 2014). Sorghum fields
  • 30. 20  |  JOBS AFTER COAL: A Just Transition for Queensland Queensland is well placed to develop biofuel products from waste and oil crops such as Pongamia and algae, in addition to using the state’s advanced sugarcane industry to convert excess cane using efficient cellulosic processes. Recent scientific developments in bio-plastics at the University of Queensland show that, as a state, Queensland has the skills and ability to build a bio-industrial products industry that can contribute to a sustainable economic future (Queensland, 2015). Renewable energy Queensland, the sunshine state, has enormous potential to generate electricity from the sun, wind and waves in addition to many other abundant renewable energy sources (Green, 2012). Renewable energy has for a long time been the catch cry from environmentalists as the complete solution to creating the jobs necessary to replace the fossil fuel industry. This report has been written partially to show recognition that as much as renewable energy has the potential to create more jobs and replace fossil fuel domestic energy production, it The mining boom has created an unsustainable dependence on fossil fuel exports. It is time to build an economy that has the potential to last forever. A bio-industrial products export industry is Queensland’s opportunity to do this for the benefit of communities today, and for generations to come. Gemasolar solar thermal power station, Spain
  • 31. JOBS AFTER COAL: A Just Transition for Queensland  |  21 cannot completely replace all of the coal export industry jobs. Numerous studies show that with strong climate policies, over 7,100 jobs can be created in Queensland through renewable energy by 2030 (Institute, 2011). Thousands of these jobs will be in regional Queensland. These should be prioritised for regions where the mining industry has developed rural communities in need of new economic opportunities. Far North Queensland is especially suited to further renewable energy investment because of its climatic conditions and because of the expensive transmissions losses from having energy wired from southern power sources (Allen, 2011). This makes it essential that government policy ensures that the fair share of the $3.5 billion in potential renewable energy investment goes to rural mining communities, not only where it is most needed economically, but where it makes the most business sense (Department of Employment, 2009). Queensland has the potential to become a smart sunshine state powered by clean and sustainable renewable energy. By doing this we will be creating jobs in rural mining communities where they are needed most and building a foundation for a new sustainable economy.
  • 32. 22  |  JOBS AFTER COAL: A Just Transition for Queensland 4. Community transitions: Global case studies There are communities around the worldwhich have reinvented themselves after the end of coal mining, and developed prosperous economies in doing so. It has been a struggle, but where there is a level of government support, inspired local leadership, and the community is working together to regenerate its economy, it has been possible (Coal, 2015). We are not suggesting any of these examples can be directly transferred to Queensland communities facing the end of coal mining. The object of these case studies is not to provide a blueprint for Mackay, Gladstone, Rockhampton, or mining towns in Central Queensland, but to show the diversity of ideas that have worked in other places that might stimulate our local communities to reinvent themselves too. Hazelwood coal power station, La Trobe Valley, Vic
  • 33. JOBS AFTER COAL: A Just Transition for Queensland  |  23 La Trobe Valley In the brown coal producing region of the La Trobe Valley in Victoria, a grassroots transitionary force has been underway for the past fifteen years. Earthworker was set up by union and climate change activists seeking a real alternative to coal and privately owned business models. Earthworker Cooperative’s mission is to create jobs that respond to the ‘challenges of climate change and the need for local job creation by facilitating the establishment of worker-owned cooperatives … in sustainability-focused industries’ (Earthworker, 2015). Their current focus is the establishment of a cooperative producing solar hot water systems in partnership with an existing business called ‘Everlast Hydro Systems’. Their goal is to take production to Morwell in the La Trobe Valley where workers are in need of an alternative to the coal industry. The unique cooperative model has made selling arrangement possible through inserting the option to buy a solar hot water system through enterprise bargaining agreements. Banwen The DOVE workshop in Banwen, South Wales (Dove, 2015), was started by agroup of women who, during the 1984–85 coal miners’ strike, decided that community-based education was the most practical path to regenerate the local economy. Setting up shop in an abandoned mine office, they developed a series of adult education workshops for women. Three decades later, the DOVE building hosts a diverse set of small-scale entrepreneurs, including a daycare, a library, a community garden, and a café featuring local foods. Orkney Orkney, like Central Queensland, is a relatively isolated place with a scattered population. Situated at the top of Scotland, two hours from the mainland by ferry, Orcadians, like Central Queenslanders, often feel like spectators to what goes on in the rest of their country. They also feel vulnerable to central government decisions and are often irritated by the lack of understanding of island life on the part of distant authorities— its particular customs, dialect, and ways of doing things. Since Norse times Orkney islanders burned peat (a very young form of coal) as their primary fuel source, but all the peat has been dug up. This traditional way of life, where each farming family had its own peat bank and spent long summer days cutting and drying peats while sharing picnics as children played, is gone. Another non-renewable energy source, North Sea oil, discovered in the 1970s, brought positive and negatives for the island. It turned the tide of depopulation, but, like the peat banks, the oil is depleting and another ‘end of an era’ is approaching. Orcadians have woken up to the fact that they can’t continue to hark back to the past and are confronting the issues of a future without fossil fuels. Over the last three decades European community funding has helped Orkney to equip itself for the green energy revolution. Orkney now plays a global role in the evolution of wave and tidal technologies and significant research and development work is creating new employment opportunities. A high school in Stromness was converted into the European Marine Energy Centre and is now a world leader, providing developers the opportunity to test full-scale prototypes in the sea. The world’s largest single-rotor tidal turbine
  • 34. 24  |  JOBS AFTER COAL: A Just Transition for Queensland was the first in Scotland to be connected to the national grid from this centre. Marine energy, combined with an expansion of wind turbines, means that the island is now self-sufficient in electricity. These renewable energy developments have created jobs in the Orkneys in civil works and erection, grid connection, and communications (Stuart, 2011). Investment in renewable energy and its associated R&D has attracted people to live, work, and study on the island. Islanders used to have to leave to get tertiary education but it is now possible to study for an MSc in renewable energy at a Heriot Watt University campus in Stromness. A new generation of Orcadians have grown up to see renewable energy as the way of the future, something quite “normal”, which will provide greater opportunities for their children to stay on the island, with genuine prospects for employment in meaningful jobs requiring a wide range of skills and qualifications. This shows what a community in transition to a low carbon future can look like. Nord-Pas De Calais Until 1986, the north-east region of France, Nord-pas de Calais, was a major coal mining area. It still boasts huge twin tailings mountains, the largest in Europe, which have become a tourist attraction. It is known to Australians for the war cemeteries associated with the battle of the Somme in WW1, but it has recently undergone a remarkable transformation towards a truly sustainable economy. Old coal mines at Lens have been transformed into an art gallery, displaying works from the Louvre collection in Paris. Hundreds of people are trained in energy efficiency, solar energy, and green architecture at a new training centre in nearby Loos- en-Gohelle. The Chamber of Commerce invited economist and social visionary Jeremy Rifkin of the TIR Consulting Group, and his chief economist Skip Laitner, to apply their model of the third industrial revolution to the district (Riftkin, 2015). Rifkin’s Third Industrial Revolution combines renewable energy, energy efficiency, and the connectivity of the internet. Buildings are energy generators and hydrogen is used as energy storage. After working with the community for some time the Master Plan was published in 2013 and envisages that 100,000 new jobs can be created by the transition plan (LLC, 2013). Certainly, the population has not declined since mining days and has even slightly increased. Inspired local leadership was the key in this community, plus some outside funding to help with the underpinning research. Appalachia (Kentucky) The transition process is just starting here, but the community is very organised. Kentuckians For The Commonwealth has been battling the negative effects of coal mining for some decades and is now planning a transition to “building a better future, beyond coal” (Commonwealth, 2015). Last year they held a conference in Harlan, Kentucky, right in the middle of the Appalachian coal fields and invited guests from other US regions in the same position, as well as from Wales. It is too soon to see what the outcome of their learning process will be, but they are another example of a community taking its future into its own hands—optimistic that there is a better future after coal.
  • 35. JOBS AFTER COAL: A Just Transition for Queensland  |  25 5. A just transition for coal mining communities policy recommendations The opportunities to transition from unsustainable coal mining to prosperous communities with decent employment will not just materialise by themselves. It will need the political will and the right incentives to ensure that communities are not left fending for themselves, with unemployment increasing and families in need of long-term welfare. But not only is the political will not currently there, both major political parties continue to support the expansion of this sunset industry, and by doing so are making the transition challenges progressively more difficult (Denniss, 2012). For too many years, governments have uncritically supported the coal mining sector. Entire government departments have been focused on facilitating mining with tax incentives, weakening assessment and approval processes, along with providing through tax payer money, established industrial infrastructure to support new projects. Government policy often seeks to grow royalties income by supporting the extraction of as much coal as possible as an escape the challenge of finding other ways to increase state revenue. New sustainable industries in coal communities will need just as much if not more support while it gets started. We propose that communities, local businesses, workers, unions, community groups, environment groups, local government and state and federal governments, all need to be involved in planning a transition to alternative forms of economic development and providing new jobs. We call this a Just Transition (Anthea Bill & Evans1, 2008; Brecher, 2012). Just Transition is a framework for a fair and sustainable shift to a low carbon economy, proposed by trade unions and supported by environmental NGOs. A Just Transition holds that a shift to a lower carbon economy is vital to avoid dangerous climate change. Bimblebox Nature Refuge
  • 36. 26  |  JOBS AFTER COAL: A Just Transition for Queensland Tough targets to cut greenhouse pollution, supported by new environmental regulations and emerging carbon markets, will transform the global economy over the next decade. These shifts will have major implications for working people in energy supply, industry and transport and for everyone as consumers. There is a concern that significant periods of economic restructuring in the past have often happened in a chaotic fashion, leaving ordinary workers along with their families and communities, to bear the brunt of the transition to new ways of producing wealth. A just transition seeks to prevent such injustice becoming a feature of this transition, suggesting that it would not only be morally wrong and socially damaging, but would undermine the credibility of the transition itself and could slow or even halt the changes that must be made. It is through the challenges of communicating the urgency of climate change and other social and environmental impacts that much of the debate about coal and its consequences for land, water and the climate has become unnecessarily adversarial and polarised. Coal mining and power generation communities deserve acknowledgement and appreciation for all that they have historically and currently contributed to our country and our economy. In communicating the economic shifts that are taking place and facilitating the necessary transitions, the Australian community needs to be respectful of the history and identity of coal communities. Environment groups, government, unions and the community need to initiate and engage in the discussions about transitions in an open, honest and compassionate manner. Only by approaching the transition in this way can the adversarial nature of the debate be broken down to make way for transformative, mutually respectful and holistic solutions. Whitsundays ‘Have a Heart for the Reef’
  • 37. JOBS AFTER COAL: A Just Transition for Queensland  |  27 A just transition recognises that support for policies are conditional on a fair distribution of the costs and benefits of those policies across the economy. A just transition should also recognise that the creation of opportunities for active engagement by those affected in determining the future wellbeing of themselves and their families is essential for the long term empowerment of citizens and communities. The following recommendations have been written with the aim of emphasising such community empowerment as a priority. Recommendations 1) Establishing a unit within the State Government to support coal mining regions to transition to new economies Specific institutions are needed to develop transition plans. They need to have strong government support and funding, regional offices, and representation from diverse stakeholders. A dedicated unit within the Department of Infrastructure, Local Government and Planning could be established to oversee this work. They could work on the ground in the main coal mining communities to bring government expertise into regional entities that would develop local plans that involve and empower the whole community. This unit, or a connected unit, would analyse existing barriers to the creation of competitive advantages for alternative sustainable industries, and would identify actions the State Government can take to support such creation. Any policy and support should come with clear conditions and timeframes. These regional entities would need generous budgets to assist local groups to develop their transition strategies, to support research, re- training, and the development of new business and community start-up initiatives, based on the needs and strategies of communities. The key to communities becoming economically resilient is high levels of autonomy and freedom in shaping their economic futures. Research funding available to the regional entities will be essential to the empowerment of local leadership. Research funding should at least reach the OECD research funding average, and it should prioritise low carbon technologies and industry sectors with increased triple bottom line sustainability potential. 2) Support community leadership in diversifying local economies through the establishment of democratic regional entities In each mining community, a group of traditional and non-traditional community leaders willing to think beyond ‘Business as Usual’ to imagine a better future could be called together to work in collaboration with, and be resourced by, the state government managed regional entities mentioned in recommendation one. The leaders would come from diverse backgrounds such as from local governments, business associations, unions, farming groups, renewable energy businesses, and educational institutions. The objectives of these leadership groups would be tailored to each community. The objectives would, in broad terms, be to increase employment in new, diverse industries based on sustainable production and public/service sector job creation. Expert facilitation, alongside inclusive and democratic community engagement initiatives, would be essential to ensure the process and environment for creativity and innovation is maximised. To develop such groups it would be necessary to take stock of the existing resources, skills, and successful businesses, on which a new future can be built. In addition, an analysis of the social, environmental, and economic needs of the
  • 38. 28  |  JOBS AFTER COAL: A Just Transition for Queensland community would also be beneficial. These groups could then establish economic diversification projects, including value-added local production, worker controlled co-operative enterprises, and new community- based enterprises that economically empower the local community. Activities may also include support for alternative industries in regard to process restructuring or subsidising the wages of workers displaced from higher paying, traditional industries. 3) Support researching and communicating how the just transition can take place Consistent research is needed on the best options to support the state and national economies to transition. This requires ongoing situational analysis of the global energy market shifts at both government levels. In addition, each mining region will need assistance to research the number of jobs that are dependent on coal, the skills of those employed, the level of local, national, and global long- and short-term risk to local mining operations, the transferability of jobs to other industries, local opportunities for new enterprises and their needs, and the local educational and training needs and resources. A key issue requiring research will be around how the transitition scenarios differ depending on the level and relativity of thermal and coking coal industries across coal mining communities. The process for sourcing this information at a local and state government level should be integrated into a policy feedback loop to support cyclical situational analysis and policy adjustments from all levels of government. This research should take place at the state level and be encouraged at the industry and local level through grants. Mackay, Central Queensland
  • 39. JOBS AFTER COAL: A Just Transition for Queensland  |  29 4) Convene a just transitions state economic summit to identify socially and environmentally sustainable economic opportunities in mining communities Many existing Queensland industries, including those not highlighted in this report, have the potential to carry Queensland towards a new sustainable economy [sC5]—but they will need support to do so. Instead of continuing to support and lower costs for the coal mining industry we need a plan to grow competitive advantage across industries that have potential for sustainability and growth in regional mining communities. Along with industry and community organisations, the State Government could organise a State Economic Summit to assess existing industry clusters; identify the potential of new and emerging industries; consider their competitiveness and key capabilities; and identify barriers to increasing competitive advantage. The findings and recommendations from this Summit could be used to inform the work of the Unit established in bullet point one above and the research outlined in bullet point two. 5) Provide social protection of workers, their families, and incomes If mines close suddenly, workers need protection for their incomes and social services, and possible relocation even though many miners these days do not live in the communities where they mine. Ideally, these transition plans would be developed early enough to ensure that new employment opportunities are in place for them before mines actually close. For many workers this is already too late, but if the process begins now, there will be choices available for future retrenched coal workers who live in mining communities and regions. Mining companies could be incentivised and/or penalised to give adequate notice to workers and other stakeholders that closure may be impending and alternative economic opportunities need to be developed. 6) Supporting Unions to play leadership roles in social dialogues and to lead worker engagement Involving the relevant unions in the planning of community transitions can enable them to move towards becoming more proactive agents helping to plan the transition, with critical networks and specific knowledge about the needs of their members. When a coal-fired power station in Washington State, USA, was scheduled for closure for environmental reasons, unions played a pivotal role, persuading environmentalists and others to delay the closure long enough for a Just Transition to provide different jobs for the workers. This made it possible for the coal resource to be replaced by wind and other renewable generation, rather than natural gas—a better environmental outcome, and the unions became an active part in the phase out planning. Unions have a heavy workload defending workers rights and pay. They need to be supported and financed to play important roles in community transitions. From facilitation and leadership of planning bodies, career planning and advice, preferential hiring for displaced workers in the new, alternative emerging industries and leading the establishment of work controlled cooperatives, unions have an essential role to play.
  • 40. 30  |  JOBS AFTER COAL: A Just Transition for Queensland 7) Provide training opportunities for coal workers and communities Retraining is crucial. Many mine workers and workers directly supporting industries are from other sectors. They were attracted by the high rates of pay and had to learn new skills to do their jobs. Some of those skills will be transferable to other industries—quarries, earthmoving for building, electrical and wastewater management trades. Preventative action should be taken through mandating coal mining companies to fund education and training for their workers that give them skills for other industries. Funding should be made available for training programs to assist retrenched workers from the coal industry to attain continued retraining and re-education. Re-education could include subsidising a worker at a full living income level for a maximum of four years to undertake training for careers that support the establishment of the new economy in their community. 8) Mandate adequate security deposits and progressive signoff for best practice mine site rehabilitation There are over 50,000 abandoned mines in Australia and an estimated 15,000 in Queensland alone (Hutton, 2013). Effective management strategies are needed to prioritise and manage health, safety, environmental, and socioeconomic risks and opportunities that abandoned mines pose to mining communities. Instead, the mis-management and poor application of weak government regulations means that many mines are still being closed and not rehabilitated properly. A common practice that must be eliminated is that liabilities from large mine sites are sold on to smaller companies who, after mining the remaining resources, lack the resources to rehabilitate mine sites to adequate standards (Hutton, 2013). The Queensland Government can choose to change this and by doing so create jobs in mining communities through restoring agricultural land or by reforesting mine sites. This can be achieved by increasing mining security deposits to ensure that the full cost of third party mine site rehabilitation is progressively implemented and signed off by governments throughout the life of the mine. In addition, action needs to be taken to prevent mining companies selling off mines where they have not fulfilled their rehabilitation responsibilities.  Just as James Hardie was prevented from moving its assets offshore into a subsidiary entity to avoid paying asbestos compo, so too the big mining companies should be prevented from ‘cutting free’ loss making coal mines to get out of their rehab responsibilities. To take a holistic approach the Queensland Government should support the nationally coordinated implementation of the AusIMM Abandoned Mines policy statement that includes the actions described above and more detailed policy changes (Unger, 2013). 9) Remove all subsidies and tax payer funded support to coal mining Historically, the Queensland Government has offered and provided incentives and added advantages to the coal mining industry that have not been received in equal application by other industries (Peel, 2014). All subsidies to the coal industry should be reviewed to ensure this practice is not ‘disadvantaging other industries, creating windfall profits, or providing an implicit guarantee to support investment decisions that turn out to be uncompetitive’ (Hayman, 2014).
  • 41. JOBS AFTER COAL: A Just Transition for Queensland  |  31 10) Sound investment and resource revenue management Discussing what economic mechanisms will be needed and how they will operate will be an essential step in ensuring funding is available for the policy measures below. In many similar situations around the world ‘Severance Trust Funds’ otherwise known as Sovereign Wealth Funds set up specifically for diversifying resource regions have been promoted and implemented, such as in West Virginia (Boettner, 2012). Along with ending coal mining subsidies, some part of the royalties from coal mining should be set aside to help fund the transition. Royalties are very low by international standards and should be increased to help fund the Just Transition described. Such funding could provide funds for industry-government partnerships that would develop sustainable jobs in highly mining dependent regions, especially those with few other opportunities for their community. Carmichael River
  • 42. 32  |  JOBS AFTER COAL: A Just Transition for Queensland Conclusion The reality of the coal industry in Queensland is that the concentration of its operations and employment in coal communities is leaving communities in great risk of disruptive global economic change. It is not acceptable for the state as a whole to benefit from the royalties from coal while leaving the communities working in the mines and in power stations with few economic alternatives or assistance to turn towards as the industries sunset gets closer and closer. There is another economic future possible, not only for coal mine workers but for coal mining communities, but governments need to take action to support communities to determine their future. The State Government should implement these recommendations as soon as possible to ensure that the future of coal communities in Queensland is one of hope and excitement. For any community in the presence of such a volatile and aggressive industry, support is needed to make a just transition and relieve the current uncertainty brought on by such a risky industry. Polluted water from a Central Queensland mine
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