This week’s closure of the Hazelwood (Victoria) coal-fired power station sees the loss of 750 full-time jobs, plus 200-250 full-time equivalent positions in supplier workforces.
In South Australia, our wind and solar power leader, a total of 710 people are employed across the State, to supply 40% of the State’s energy needs (if the sun is shining and the wind is blowing). In SA, thousands of jobs were lost and a whole town wiped out at Leigh Creek , as its coal mine and power station were shut down, making way for one of the world’s most aggressive deployments of wind and solar power.
As we reported last week, this highlights the fanciful nature of activist claims that renewable energy will provide more employment opportunities than fossil fuel production. It also underscores the reality that fossil fuel back-up is needed for renewable energy, as the SA Government’s decision to build a new gas power station clearly demonstrates.
On the jobs and economic health upside, coal-seam gas development in south-west Queensland has told a much more positive story, as the unemployment graph below clearly shows.
In addition to a very positive jobs effect, reducing unemployment in the area, the gas industry has also underpinned a rise in average incomes, as the graph below shows.
Similarly, there is good reason for optimism that the proposed coal-seam gas development and associated gas pipeline at Narrabri, in northern NSW, will deliver major benefits to the region and State.
Santos plans to invest about $2 billion developing the Narrabri project. About $1.2 billion in royalties are anticipated for the State and a Community Benefit Fund is expected to inject about $120m into the local area.
APA Group has flagged its intention to build a pipeline to get the Narrabri gas into the East Coast distribution network.
The 450 kilometre pipeline will cost about $500 million and will employ hundreds of workers.
About 1300 people will be employed during construction of the Santos project and about 200 in an ongoing workforce for 25 years or more. Local people and local businesses will be preferred wherever possible, meaning significant spin-off benefits for the region.
To reassure people about its attitude to responsible development, Santos has given a written pledge that it will not try to push gas wells onto unwilling landowners.
In its Environmental Impact Statement, it has said that, during production, a landholder with 2-3 wells on his or her property could expect to be paid about $50,000 a year by Santos.
Again, this is a topic of major misinformation by activists, who commonly say landholders will be ‘ripped off’ and will be lucky to get more than a few hundred dollars a year — as was claimed by activist Dayne Pratzky during NSW promotion of his movie, Frackman, in 2015.
Frackman was actually set in the coal-seam gas operations in Tara, and nearby towns in south-western Queensland, including Chinchilla, Dalby and Roma.
Roma has a long history in safe natural gas production. In fact, natural gas was used to fuel the first ever street lamps in the town, in 1901. Despite this long history, dating back to a time of much less engineering sophistication and environmental awareness, there has never been an ecological calamity in Roma, or anywhere else in Queensland, associated with gas.
About a decade since the latest coal-seam gas drilling activities started in the area, the same applies – despite the dire warning at the start of the Frackman movie that CSG drilling would bring about the end of the world.
The upside benefits of the CSG industry have been much more real and plain to see: 40,000 people employed, $70 billion invested, many billions of important export income to be earned over coming years and hundreds of millions in royalties to the State Government every year to spend on roads, schools and public health.
There are 5000 landowners who have struck facilities deals with gas companies. They have collected $200 million for their troubles and are still able to continue with their existing farming or other activities. In addition to the income, many are better off with improved fencing and access roads, as well as access to irrigation water (from deep underground, well below farming aquifers) which was previously unavailable. Some say the CSG boom has been the closest thing to drought proofing they have ever experienced – and has helped keep their kids from drifting to the city to find work.
Another furphy spread by activists is that CSG development lowers land values. This is wrong, as shown by the graphs below, from a Queensland University study:
The reality is that resource developments often cause housing purchase and rental prices to spike during the construction phase.
This was the case in south-western Queensland, which experienced a jobs and investment boom as the State geared up to create a new export industry.
With that phase having been completed, house prices and rents have eased. However, they remain higher than levels seen before the construction boom.
Prices are likely to stay at the higher level because of the ongoing boost to the local economy that the gas industry has brought and will continue to bring for decades.
What these graphs also show is the very clear improvement in the unemployment rate as a direct result of the gas industry work and opportunities for business suppliers to the industry and the workers in it.