Failing Collie coal miner Griffin Coal is burning through its $220 million taxpayer support fund faster than the government anticipated.
Premier Roger Cook revealed to parliament on Tuesday that the government had so far made $182.7 million worth of payments from the $220 million support package for Griffin Coal, which mines coal used to power the state 180 kilometres south of Perth.
Griffin Coal is burning through its taxpayer cash.Credit: Nic Walker
The package was devised in December 2023 to avoid the shutdown of Griffin Coal’s mining operations in Collie, which would have cut coal supply to the privately owned Bluewaters power station and Synergy’s nearby coal-fired power stations.
The $220 million package was on top of $40 million in support payments already paid to Griffin.
On average, Griffin is drawing down about $10.5 million from the taxpayer fund each month.
At that rate, it will have expended the whole $220 million by September, despite the funding support originally slated to end in June 2026.
If the Collie coal supply is impacted, it could impact the reliability of the south-west electricity grid over summer.
Indian-owned Griffin Coal entered receivership in 2022 following escalating losses on the fading operation and crippling debts that reached about $1.5 billion.
Cook confirmed he intended to cease funding Griffin by June next year and had reached out to stakeholders to find out what their plan was after taxpayer support ended.
“As I have previously stated, this funding support will cease in June 2026,” he told parliament.
“I can advise that I have recently written to the relevant commercial parties seeking updates on their planning for the cessation of government funding at this point.
“The government remains of the firm belief that beyond June 2026, Griffin Coal’s future is a matter for the relevant commercial parties.
“As I have previously advised, if the commercial parties come forward with arrangements to support the stable operation of the mine based on customers paying a fair price for coal, the government will facilitate an appropriate outcome. This remains the case.”
Cook said he trusted the stakeholders were making sufficient plans for this date.
Opposition energy spokesman Steve Thomas said the ongoing subsidies for Griffin Coal reflected two decades of dysfunction in the Collie coalfields – which he claimed the government had no plan to fix.
“It is pure nonsense to suggest that the private companies involved will find a solution that has eluded the government for years and cost the taxpayer $6 million a month in subsidies to a foreign-owned and insolvent company,” he said.
“If a simple and workable commercial solution existed, the state would not have shelled out nearly $200 million in handouts to date.
“It would not be so bad if the $260 million total subsidy was delivering an outcome, but it has just been kicking the problem down the road.
“It is time for the state government to recognise the scale of this disaster and step in to fix it.”
Griffin’s administrators Cor Cordis were approached for comment.
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