State Government to bail out of clean coal project - Courier Mail

By Craig Johnstone
April 23, 2009 12:00am

TENS of millions of dollars of taxpayer money is in jeopardy as the State Government considers walking away from its $125 million clean-coal project.

ZeroGen Pty Ltd - developed during the "Smart State" era - should be sold off or wound up, an independent review of Government bodies and authorities has found. The Weller Review said ZeroGen "has significant financial responsibilities in a highly technical, if not speculative, area". The Government will accept the recommendation.

ZeroGen, to which the Government has committed more than $100 million, plans to capture carbon dioxide emissions and bury them underground, a technology that has been hailed as the future of the coal industry. It had aimed to develop the world's first clean-coal power plant near Rockhampton by 2012.
But recent doubts have emerged about the project's viability because of the way it would be treated under the Rudd Government's proposed emissions trading scheme.
The State Government said it would investigate whether ZeroGen should be sold or wound up.

The State Government has placed great faith in clean-coal technology, saying it has the potential to cut up to 90 per cent of greenhouse gas emissions from large-scale power generation.
In a statement, Energy Minister Stephen Robertson said the Government remained "committed to accelerating the deployment of low-emission coal technologies before 2020". "The future direction of ZeroGen will be determined by Government in consultation with industry partners," Mr Robertson said.

The project, a key plank of the Government's superseded Smart State strategy, was expected to generate up to 700 jobs during its construction phase and 125 jobs once it was operational.
The company is due to complete a feasibility study into the technology the end of the year.
In March last year, Premier Anna Bligh said that, although Zerogen was a government-initiated project, it needed other "substantial funding contributors".
She said while the coal industry and energy company Shell were strong supporters, it also needed Federal Government and private support.