15 December 2016
New South Wales’ big five coal-fired power stations should pay 49 times more than they are paying for the pollution they emit, if we are to substantially improve public health.
Dr Ben Ewald, spokesperson for medical group Doctors for the Environment Australia says only fees which properly reflect the total cost of production to the public (including externalities) would provide an economic incentive for polluters to improve processes, select higher quality fuel, or to close poorly performing power plants.
DEA raises awareness of the link between health and the environment, and is supported by many distinguished members of the medical profession including a Nobel laureate, recipients of the Australia of the Year award and deans from leading medical schools.
Says Dr Ewald, “Air pollution is a serious problem in Australia and is responsible for 3000 deaths per year nationally.
“Coal-fired power stations are substantial sources of air pollutants that cause asthma, chronic lung disease and restricted lung growth in children, heart disease, lung cancer, and deaths.“
The three major pollutants are particulate matter known as PM, sulphur dioxide and a mix of nitrogen oxides.
Tackling air pollution would bring major health benefits. Research published in 2015 showed a 10% reduction in PM2.5 alone for Sydney would, over 10 years, result in 650 fewer deaths and 700 fewer respiratory and cardiovascular hospital visits.
“These pollutants are not restricted to local towns where coal-fired power stations are located,” says Dr Ewald. “They can travel long distances- 70, 90 and 140 Km away- and contribute to major city pollution.”
Externality costs for the health effects of air pollution from coal fired electricity production in Australia were in 2009 estimated as $13 per MWh by the Australian Academy of Technological Science and Engineering. The community is currently paying this price in health damage although it does not appear on electricity bills.
Based on 2014-15 figures, an externality of $13 per MWh levied on the five big coal fired generators in NSW would generate $687 million dollars, which is 49 times higher than current pollution fees.
If this money is used to subsidise cleaner and more efficient plants, it would have no or little price impact on consumers.
The model has been used successfully in the Swedish load based licensing system, where the fee per Kg for nitrogen oxides (NOx) is approximately 100 times higher than in NSW.
Dr Ewald says that for the polluter pays mechanism to work effectively, other States that share electricity in the national electricity market would also have to implement similar schemes to make it economical.
The call for an increase in pollution fees is made in a recent DEA submission to the NSW EPA review whose closing date is 23 December.
“We don’t have to re-invent the wheel- the NSW model is essentially an excellent one, once appropriate pricing is included in the mix.
“If we want our families and communities to have better health, we must get serious about protecting the air we breathe.”
In the submission, DEA also makes the case for pollution fees to be extended to the mining sector, as it is the biggest emitter of PM2.5. Currently, the mining sector is exempt.
Dr Ben Ewald is a GP, teaches epidemiology at the University of Newcastle and is a member of Doctors for the Environment Australia. He can be contacted on 0422 378 042