Electricity prices to soar, says AIG report

Electricity prices to soar, says AIG report

Australian Industry Group has released a report today that points to painful electricity and gas price rises even without a carbon price.

You can view the report here at the bottom of this page.


  • Gas prices set to rise in move to world parity pricing as LNG plants come on line
  • Higher black coal prices internationally to force up cost of coal-based power generation
  • Weak international carbon pricing to see growth in black coal consumption
  • Low investment confidence due to carbon price & timing uncertainty

Domestic Implications for Coldry

While we can’t forecast the absolute price of electricity our investigations show that a Coldry-based solution can achieve Victoria’s 20% emission reduction target for 27% less cost than gas and 46% less than wind.

Victoria has a natural competitive advantage in the national electricity market thanks to cheap, abundant brown coal. The single largest brown coal reserve in the world in fact. Enough to last around 500 years at current rates.

The downside to using brown coal to generate electricity is higher CO2 emissions per MWh compared to black coal and gas fired generators.

The only economic way to continue to use brown coal while reducing carbon is to remove the water via the Coldry process so it can be burned more efficiently.

The report by AIG shows prices have risen, and will continue to rise, even without carbon pricing. So when it comes time to take real action to mitigate the emissions from the use of brown coal, prices are guaranteed to jump even further.

However, with the shock disclosure last week of the real cost of carbon reduction – $168 per tonne saved on average – the Government seems to be spending our money on high cost ‘photo opportunities’ rather than affordable, deliverable results.

How much extra will it cost per tonne of CO2 saved? Around $25 for a Coldry-based solution in Victoria.

Export Opportunity for Coldry

Being a black coal equivalent, Coldry is ideal for export into the increasingly lucrative thermal coal market for use in black coal-fired power stations.

With black coal increasing in price, emerging nations will increasingly turn to CO2 intensive brown coal in order to keep the lights on.

By making Coldry available, the need to turn to more CO2 intensive brown coal is reduced.

ECT is currently pursuing its Victorian Coldry export project in addition to opportunities in China, India and Poland.

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