Expansion of coal will come at a cost. A new report says it won’t be mining that pays

Any expansion of coal mining in NSW would force every other industry to make faster and deeper cuts to greenhouse emissions, the state’s first report from the newly established Net Zero Commission has warned.

The report also warns that the pace of renewables development needs to accelerate if NSW is to have any chance of meeting its legislated targets for emissions reductions and net zero by 2050. By law, NSW must reduce greenhouse emissions by 50 per cent on 2005 levels by 2030 and 70 per cent by 2035. In April, the government warned the state was not on track.

NSW’s Minister for Climate Change, Energy and the Environment, Penny Sharpe, said the Net Zero Commission was “doing exactly what it was set up to do” by providing independent advice to government.

“It’s clear there’s more work to do,” Sharpe said. “The Minns Labor government has made action on climate change a whole-of-government priority, and we’re working hard to deliver more renewable energy into the grid to drive down emissions and power prices.”

The report highlighted the risk of increased emissions in the resources sector from new coal mining projects, including extensions and expansions of existing mines.

“Any emissions increases associated with extended or expanded projects would require all other sectors to make greater emissions reductions if the state is to meet its emissions reduction targets,” the report says.

A coal stack in the Hunter Valley, NSW.Credit: AP

Direct emissions from the resources sector have declined since 2005, mainly because of coal mine closures, yet still account for 11 per cent of NSW emissions. The report highlighted a “sizeable pipeline of projects that have been submitted for consideration and determination through the planning process”.

Approvals by the NSW government since December 2023 include expansions of the Moolarben coal complex near Mudgee, Boggabri open cut coal mine near Narrabri and Glendell open cut coal mine in the Hunter Valley.

In September, the federal government also gave final approval to the Narrabri underground mine extension and two Hunter Valley mines.

The report notes the NSW government is considering another 33 planning applications for existing coal operations, 22 of which could affect the state’s emissions.

Earlier this year, the NSW Environment Protection Authority signalled that the Hunter Valley operations expansion was the biggest coal mining proposal in NSW history. The report notes the company has withdrawn that application but intends to resubmit next year.

NSW Minerals Council chief executive Stephen Galilee said the mining industry was required to reduce emissions and would continue to do so through direct abatement, offsets and new technology.

The commission’s report also warns that the renewable energy transition needs to be accelerated to meet 2030 goals and the May decision to defer the closure of the Eraring power station to shore up power security would have consequences.

“Every year that Eraring continues operations beyond 2025 means the state’s emissions will be significantly higher than with an earlier closure,” the report says.

In 2023-24, nearly two-thirds of NSW’s electricity generation was from coal and more than a third from renewables, the report says.

The NSW government will respond to the report next year.

Since April 2023, the government has approved six onshore wind farms, 11 large-scale solar farms and 14 battery energy storage systems.

As of November 2024, there are 56 utility scale solar farms, 13 onshore wind farms and 61 battery energy storage systems under construction or with planning approval.

Legalise Cannabis MP Jeremy Buckingham said the report was “an alarming wake-up call” that NSW was not on track to meet “bare minimum” targets.

“If these coal mines go ahead, it will ... mean that agriculture, manufacturing, construction, transport, waste will all have to cut deeper and faster, at great expense for them,” Buckingham said. “Essentially, the decision is, do they want to subsidise the expansion of coal in this state?”

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