New Zealand will be better encouraging clean coal technology than banning the fuel.

The New Zealand Business Council for Sustainable Development, whose 71 member companies' $44 billion in annual sales equate to more than 34% of the gross domestic product, says focus should go onto encouraging clean coal research and development, not issuing orders to stop it.

Business Council Chief Executive Peter Neilson says while Green Party concern over the environment and climate change is understandable and shared by the Business Council.

However, if New Zealand wants an international agreement covering greenhouse gases post 2012, we need to recognise coal will still be part of the energy mix for the foreseeable future.

Most major emitting countries (China, India, US, South Africa, Australia) rely heavily on coal.
"When you think about it Europe, America and New Zealand got rich on coal. You can't deny other countries their use of the fuel. What we can do is help make sure clean coal technology is developed, and coal emissions face a price around the world," Mr Neilson says.

He was commenting on the Green's policy announcement yesterday advocating an end to new coal mines, a ban on thermal coal exports, instructing state owned coal company Solid Energy to "stop pouring money into lignite to liquid fuels", and to shut down SOE Genesis' Huntly gas and coal fired power stations over time.

The Greens will also try amending the emissions trading bill to include coal seam methane in the climate change obligations of coal mining companies.

The Business Council, an advocate of emissions trading since 2003, says putting a price on coal emissions through the trading scheme will send a strong enough signal to coal users about lowering emissions, or paying for them.

"We don't think a ban on new thermal (gas and coal-fired) generation is needed when you have a new price on carbon.

"The emphasis should go onto delivering commercially viable clean coal technology in the next 10 years. Solid Energy's $100 million 20-year investment in renewables and clean coal should be encouraged, not stopped.

"The issue is emissions, not the coal or fuel type.

"Clean coal technology stripping more than 95% of CO2 from a coal fired power plant's emissions is now being trialed on a commercial scale in Norway by Sargas. It is costing US$20 per tonne, below the current forward futures contract price for emission credits.

"Solid Energy and partners are trialing burying emissions in Australia, and sequestration trials have been successful in Japan.

"If we can find a way of capturing and storing coal emissions, then we open up the option to use 400 years' worth of coal supply in this country. The emissions price will direct investment to lower-emission fuels, including clean cal technologies," Mr Neilson says.

Coal industry sales are worth more than $680 million a year, employs more than 1200 people directly, earns valuable export income and is essential fuel for many industries, including dairy, timber, steel and processing.

"We should be focusing on its potentially massive economic benefit to New Zealand as a clean future energy source, not bans, while still not losing sight of the need to urgently lower emissions worldwide to avoid irreversible climate change damage."

New Zealand is making exciting progress with new technology which will deliver the world clean non-food sourced bio fuels, clean up steel mill smoke stacks, and lower farm emissions through nitrogen inhibitors. Other projects may possibly result in massive carbon capture in cultivated soils, and breakthroughs in reducing methane emissions from ruminant animals. All could be worth billions to the country.

"I think we need to lift our sights and go for the major wins, while accepting a price on carbon will redirect investment to low emissions options, or require emitters to buy credits from others in the world who have cut emissions."

Green Party policies on the waste bill and levy, energy efficiency labeling for vehicles and solar have shown it can work with business to mainstream sustainable performance. Restricting research on clean coal technology would be an unfortunate backward step compared with recent progress in working with business.

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