Fortescue’s head of carbon and climate has told a conference the state is not incentivising decarbonisation enough, warning investment dollars are being lost overseas.
Fortescue’s head of carbon and climate has told a conference the state is not incentivising decarbonisation enough, warning investment dollars are being lost overseas.
Speaking at the Smart Energy Council’s WA Renewables & Clean Export Summit this morning, the iron miner’s carbon and climate manager, Lucile Bourguet, pressed the point that Western Australia was not competing internationally when it came to attracting decarbonisation investment.
Ms Bourguet, a 2022 Business News 40under40 winner, called on the state government to introduce a policy to counteract the impacts of the federal fuel tax credit.
The scheme allows businesses to claim tax breaks for fuel use in heavy diesel vehicles. Fortescue believes it is a disincentive to industrial decarbonisation.
Pressing that point, Ms Bourguet said businesses were currently offered greater incentives to maintain the fossil fuel status quo than to pursue innovative solutions.
“The diesel fuel tax is a huge disincentive to decarbonise, because you’ve got a second mechanism which is meant to incentivise you to decarbonise,” she said.
“But the diesel fuel tax credit is there, and it is a disincentive four-to-five times greater than the tax incentive.
“The state government should look at what can be done at a state level to counteract this disincentive.”
The fossil fuel tax credit was introduced in 2006 to compensate industrial fuel use on the basis it is less dependent on government roads.
Ms Bourguet said current decarbonisation incentives on offer were supporting multinationals to focus on their projects elsewhere, highlighting Brazil and Chile.
“These big miners, they are global companies, and when they decide to pour capital into decarbonising their assets, they will keep the asset in the country where the business case will be stronger,” she said.
“At the moment, the business case is stronger in other parts of the world, not in WA, and as long as this will remain, WA will remain full of fossil fuel.”
Fortescue has been a high-profile mover in the green hydrogen and electrification spaces in WA, developing a series of trucks powered using hydrogen to demonstrate the technology: most recently its Europa haul truck.
In August, founder and chair Andrew Forrest said any company equipment still running on diesel or gas by 2030 would be turned off.
The company appeared to ease its hydrogen ambitions in July when 700 jobs were cut amid a global restructure.
It has since committed to spending more than $4 billion on 475 electric mining machines from Liebherr, an order that will replace the bulk of its existing Pilbara fleet.
The same day, Mr Forrest launched the company’s climate transition plan: setting targets for its decarbonisation goal of zero emissions across its Australian iron ore operations by 2030.
A day later, Fortescue partnered with battery electric specialist MacLean, which will deliver 30 GR8 EV graders to Fortescue's WA mining operations.
The state government, the only jurisdiction in Australia without a 2030 emissions target, has alluded to the fact its emissions could rise in the years ahead.
Ms Bourguet wryly invited the government to model its own strategy on the structure set out within the Fortescue plan.
“The report is public,” Ms Bourguet said.
“Just take it, copy, remove Fortescue and put WA instead, and you’ve got half of your plan written.”
The event was attended by Roger Cook’s Parliamentary Secretary Jess Shaw and Member for South Perth Geoff Baker.
Fortescue shipped first product from its Belinga iron ore project in Gabon in December, the company’s first iron ore mine outside of Australia.
