Queensland Coal Mines Reap Benefit of Hidden Subsidy in Free Groundwater

New analysis released by The Australia Institute today estimates that hidden subsidies from the Queensland Government to the coal mining industry, in the form of the value of groundwater accessed for free, represent at least $100M in value for the Galilee Basin coal mines alone.

Report author Rod Campbell, who is the Director of Research with The Australia Institute, said “This analysis reveals that the mining industry reaps a huge financial benefit from accessing public groundwater resources effectively for free.”

 “Our analysis indicates that the value of groundwater that will be provided to the Galilee Basin coal mines for free, if they are all constructed, would be worth approximately $100M.

“Our analysis is based on the economic value of groundwater used by coal industry economics consultants and expert assessments of the total volume of groundwater that will be intercepted by the Galilee Basin coal mines.

“If large volumes of a public resource are being granted to private enterprises through a veiled subsidy that is not made transparent to the public, at the very least the community has a right to expect strong regulatory controls on use of that resource.

“However, in Queensland, the Government is instead moving to weaken regulation of groundwater.

“Just last week, the Minister for Mines and Natural Resources moved unilaterally to declare the Carmichael coal mine as ‘critical infrastructure’ which will allow the water licensing process to be fast-tracked and could limit opportunities to interrogate the impacts of the mine on groundwater.

“Queensland’s coal industry already receives great financial assistance from the Queensland community through government funded infrastructure, favourable tax treatment and unfunded environmental damage.

“As the world seeks to decarbonise the economy, the Queensland Government should be moving to wind back subsidies of this nature and should be increasing protection of groundwater resources, not weakening them” Campbell said.