Steel manufacturing sector underpinned by renewable energy can replace coal jobs, says Grattan Institute
A steel manufacturing sector underpinned by renewable energy can replace coal jobs and be a major employer, says the Grattan Institute.
A steel manufacturing sector underpinned by renewable energy can replace coal jobs and be a major employer in central Queensland and the NSW Hunter Valley, according to the Grattan Institute.
A report released on Sunday night, authored by the Grattan Institute’s Tony Wood and Guy Dundas, argued Australia can create clean energy jobs in coal regions, with the biggest employment opportunity being “green steel”.
“Green steel uses hydrogen, produced from renewable energy, to replace metallurgical coal to reduce iron ore to iron metal,” the report said.
“Australia’s renewable resources make it a lower cost place to make hydrogen, and therefore green steel, than countries like Japan, Korea and Indonesia.
“But to do this at a global scale, Australia will also need a large industrial workforce — such as those found in central Queensland and the Hunter Valley.”
The report noted that it would be difficult for Australia to export hydrogen while exporting solar energy would fail to create many jobs.
There are about 100,000 jobs in carbon intensive industries, with coal jobs increasing by 70 per cent from 2006 to 2016.
“Simply producing clean energy does not create many jobs, even if the energy is exported. It takes only 10-to-20 full-time staff to manage a 400 megawatt wind farm,” the report said.
“And on average, these jobs don’t pay as well as current fossil-fuel electricity
generation jobs.
“Many more jobs are likely to come from Australia using its energy cost advantage to produce low-emissions, energy-intensive commodities for export. Manufacturing activities are typically more labour-intensive than renewable energy operation, and are likely to have conditions and pay more like today’s jobs in smelting and coal power stations.”
The report said that, while private sector investment would be needed to give steel manufacturing global scale, Australian governments should invest in the sector so it can be viable within a decade.
“This is best achieved through government funding to support a steel flagship project. This could involve gas instead of hydrogen in the interim, providing a lower cost and commercially proven path to green steel,” the report said.
“Western Australia, with its low-cost gas, could play an important role. And moving towards
lower-emissions steel could help sustain existing steelmaking jobs in Port Kembla or Whyalla.”
Energy Minister Angus Taylor backed the potential for “clean commodities” to be made with hydrogen.
“The $370 million recently made available through the Clean Energy Finance Corporation and Australian Renewable Energy Agency demonstrate this government’s commitment to supporting a domestic hydrogen industry which will create jobs and economic opportunities particularly in regional areas,” Mr Taylor said.
