By Mark Ludlow

September 11, 2018 - First it was the remaking of the Titanic, now it's an even bigger gamble – building a new coal-fired power station in Australia.

Former politician and Queensland businessman Clive Palmer's plans to build a $1.5 billion ultra supercritical coal-fired power station in the Galilee Basin, about 500 kilometres from the coast, have been met with a mixture of disbelief and cynicism about whether the unlikely project will see the light of day.

Clive Palmer

While Australia's national energy debate in recent years has been focused on the affordability of renewable energy such as wind and solar and the phasing out of polluting coal from the National Energy Market, Palmer has thrown energy industry orthodoxy out the window and announced plans for the first coal-fired power station in decades.

The proposed "low-emissions" plant will be built on his company Waratah Coal's tenements in the Galilee Basin where Indian energy giant Adani is also trying to fund its controversial $16.5 billion Carmichael mine.

A string of projects in the frontier Galilee Basin – which has never been developed because of the need to build a 400 kilometre rail link closer to the coast – have been on the backburner because they have struggled to get finance from big banks which are turning away from investing in fossil fuel.

These include Adani and Mr Palmer's $6.5 billion project as well as GVK/Hancock Coal's two mines, including the $10.8 billion Alpha coal project (30 million tonnes export capacity) and $6 billion Kevin's Corner 30 million tonnes export capacity).

A spokeswoman for Resources Minister Anthony Lynham said they would consider any application from Palmer, but they had yet to receive any.

But Queensland Premier Annastacia Palaszczuk – who is trying to transform the state to 50 per cent renewable energy by 2030 – poured cold water on the latest proposal saying "Queensland does not need another coal-fired power station".

"We have the youngest, most efficient of coal-fired power stations in the nation. We are the energy power house," she said.

Palmer – who has form on announcing projects which never see the light of day, such as building a replica of Titanic – said he would be seeking an amendment to the draft Environmental Authority for the Waratah Coal project to now include a 700-megawatt power station, associated transmission lines, coal handling facilities, ash containment facility and water storage facility.

"I am putting my money where my mouth is by announcing this new station so we can power Queensland and help bring down energy costs which continue to escalate," Palmer said in a statement.

"The Galilee power station will be developed as a contingent component of the overall project, providing the power needs for the mine operations, coal transportation, ready for export coal to Gladstone and the future power needs for our proposed North Galilee mine development."

The Waratah Coal project is expected to comprise two open cut and four underground mines which will produce up to 40 million tonnes and thermal coal for export markets.

Critics Finger High Cost

Palmer is back in the money following a recent court victory against Chinese company CITIC Pacific which netted him $300 million, despite administrators still pursuing him over the $300 million collapse of Queensland Nickel. (Palmer has committed to re-opening the Townsville refinery but this hasn't happened yet either).

Palmer has also promised to resurrect his political party to contest next year's federal election, but he has made contradictory statements about whether he will contest a seat himself.

The businessman says more coal was the answer to Australia's energy needs.

"Coal-fired power stations are cheaper than renewables but we're finding out the hard way," he said.

But critics don't believe Palmer's new coal mine will ever see the light of day, namely because this project has been proposed before - and the big costs of transporting energy from the Galilee Basin and back into the national grid. (Nearby Alpha has a population of 4700 people.)

Galilee Power, a subsidiary of Waratah Coal, lodged an application for a 900-megawatt coal-fired power station "incorporating clean coal low-emissions technology and carbon capture and storage, with the Queensland Coordinator-General in June 2009 under the former Bligh Labor government.

It was declared a "significant project" in September 2009, with draft terms of reference for an Environmental Impact Statement put out for public consultation in January 2013.

But with Palmer's foray into politics with the Palmer United Party, which briefly held the balance of power in the Senate, and then the collapse of his Queensland Nickel refinery in Townsville, the Galilee Power project fell by the wayside. Its "significant project" status lapsed in April 2015.

Although pro-coal advocates in the federal coalition have been calling for a new coal-fired power station to be built in Australia, investors have baulked at the price-tag believing it would be up to $5 billion which could be a huge risk at a time when coal is being phased out of the NEM.

Energy experts said they believed the new coal-fired power station would never get off the ground, saying he was unlikely to raise the funds. Recent reports have showed new coal projects are about $80 per megawatt hour, compared to about $60 per megawatt hour for renewables.