War in Ukraine responsible for half the jump in local coal profits, says left leaning think tank
Coal companies enjoyed windfall profits of between $39 billion and $45 billion in 2021-22, according to the left leaning Australia Institute.
Coal prices have surged again as production hits Qld mines
The research comes as the Federal Government plans a price cap on coal and gas in an attempt to lower energy prices.
The State Government also earlier this year imposed a bike hike in coal royalties which has generated an additional $2 billion above initial expectations.
The institute said its research showed that coal export revenue reached $112 billion in 2021-22, an increase over the previous year of $73 billion. However, that includes coking coal which was not generally used in energy generation.
Thermal coal, used in energy generation, made up less than half of the reported level.
Of the windfall estimated to be as much as $45 billion, the Australia Institute said as much as $23 billion could be attributed to the Russian invasion of Ukraine.
“Combined, the coal and gas export sectors have received an extra profit windfall of $85 billlion,” the research stated.
“A windfall profits tax could collect 100 per cent of this revenue and be used to transition away from coal and gas while supporting consumers to deal with high energy prices.”
The institute’s executive director Richard Denniss said coal companies “had been making a killing” while households and businesses were hit with increased energy prices.
The claims are countered by the industry’s claims that the extra profit it has received made up for times when the prices were below profitable levels. It also allowed the companies to invest in future projects.
Costs have also accelerated for resources companies and Glencore scrapped the planned development of the Valeria thermal coal mine in central Queensland and pointed the finger of blame at the State Government’s royalty hike.
BHP has also halted investment in Queensland coal and increased its provisioning for the potential early closure of Queensland mines.