MERC Newsletter – February 2022

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Introduction

Delegates, here is the February MERC Newsletter, please circulate the Newsletter to your fellow Councillors and senior staff this week, so they can appreciate and understand the excellent work the Association and you are doing on behalf of your Council and community, with regard to mining and energy related matters.  

 

Delegates

There has been some significant changes to the MERC delegates list due to election results and some delegates not restanding in their LGA’s. A big thank you to those departing delegates for their contribution to MERC and a warm welcome to their replacement delegates.

Councils are still appointing their delegates in February 2022. If Executive Assistants or delegates could notify the Executive Officer by email (info@miningrelatedcouncils.asn.au)  who their delegates to MERC are  as soon as appointed, it would be appreciated.

 

Executive Committee

In accordance with the MERC constitution, as a result of the recent Local Government elections, the remaining 3 Executive Committee members of Cr Micheal Banasik (Wollondilly Shire Council – MERC Deputy Chair), Cr Phllyis Miller OAM (Forbes Shire Council – MERC Executive Committee) & Cr Katheryn Smith (Mid Coast Council – MERC Executive Committee) will operate as the Executive Committee until the Annual General Meeting elections are held on 18th March 2022 when the 6 positions on the Executive Committee are up for re-election.

In the meantime MERC is in the safe hands of the aforementioned Executive Committee with Cr Michael Banasik as the Acting Chair of MERC as the most senior person remaining.

 

COVID-19 Virus Impact on MERC

The NSW State Government continues to work very closely with Councils to support communities across the state in response to COVID19 and the changing situations in 2020, 2021 and 2022.

In 2022 MERC will be resuming its’ activities in the normal manner as the level of vaccination rate is reached for the State Government to relax controls sufficiently to enable this to occur.

What this means for MERC delegates is that 2022 will have quarterly face to face meetings (with zoom facilities for speakers and some delegates due to circumstances beyond their control and have contacted the Executive Officer, cannot make the meetings) and Executive Committee meetings will be by virtual or face to face means.

The AGM as a “one-off” approved by Department of Fair Trading providing it is held before 21st March 2022 is allowed to be “face to face and by zoom” meaning that the method of voting must be by show of hands, if needed for the positions on the Executive Committee.

 

Next Meetings for the Association in 2022

The AGM and Ordinary meeting will be held in Orange at Orange Ex Services Club on 18th March 2022 with a networking dinner and hopefully (if it can be arranged) a tour the day before. The Executive Committee will have a meeting (by teleconference) on Wednesday 16th March 2022 at 9am or later if need be to meet their availability & minutes distributed before the meeting on 18th March 2022 (this is tentative and subject to confirmation by the Executive Committee).

 

AGM Executive Committee Elections

Under the constitution, MERC is required to have one General Meeting (the Annual General) a year and as many other General (Ordinary) Meetings as the Executive Committee determine. MERC must have four Executive Committee meetings a year. The Executive is to be elected annually at the AGM by delegates.

Note that in the MERC constitution there is no postal voting (Clause 14.3) or provison for those attending the meeting by video or tele-conference on how to vote, even though if requested, tele-conferencing facilities are to be made available (Clause 4.4). What does this mean – are delegates regarded as present if on video or phone and how do they vote remotely, in this present day and age since Covid? Executive Officer has investigated the options, interpretations  with Dept Fair Trading and other Associations that have addressed this.

Elections for the Executive Committee are to be conducted as per Clauses 14.6.and 14.7 taking into account the Voting Methods used in Annexure A to the Constitution for Chair, Deputy Chairs & Executive Committee – by open voting only to ensure everyone has the opportunity to vote without constitutional changes. This voting method will require the voter to be present when election is held, either in person or by video conference such as zoom.

Nominations are in the process of being called at the same time this newsletter goes out and must be in to Executive Officer by 4.30pm 17th March 2022. If any changes are required to our constitution for voting they must be made at a General (Annual or Special) Meeting with at least two thirds of the delegates present at the meeting to agree to such alterations or amendments.

Outside of this, the Department of Fair Trading has issued a directive that under the Associations Incorporations Act 2009 & Regulation 2016 the MERC AGM can be deferred until 2021 or we can have an AGM with combination of virtual and face to face by 21st March 2021 to enable everyone to participate, without having to change the constitution. Consequently the decision has been made to have the AGM as normal with zoom given MERC had already resolved to do this on 14th August 2020 by the Executive Committee. Read how the election process works in the next section following Enquiries to the Executive Officer.

 

Election of Executive Committee Positions Process

Elections for a position on the Executive and Executive Committee shall be conducted in accordance with the provisions outlined in the sub clauses 14.6.1, 14.6.2, 14.6.3 and 14.6.4, following.

14.6.1     Contested Elections – Chairperson & Deputy Chairperson                     

  1. If the number of candidates nominated for the positions of Chairperson and Deputy Chairperson is greater than one, the election is to be a contested election;
  2. In the event of there being only two nominations for the election of one candidate for the indicated positions in (1) the voting system in such contested election will be by Ordinary Ballot (secret ballot) or by Open Voting (show of hands)
  3. In the event of more than two nominations for a position in (1), the voting system used for the election shall be the preferential system;
  4. If a contested election is required for either Chairperson or Deputy Chairpersons, the decision on the voting method for (2) is to be made at the Annual General Meeting immediately prior to the election.

14.6.2     Contested Election – Three positions for the Executive Committee

  1. If the number of candidates nominated for the three (3) remaining Executive Committee positions is greater than that number, the election is to be a contested election.
  2. The voting system in a contested election for the three (3) positions will be preferential.

14.6.2     Candidates’ Nominations and Resumes

  1. Nominations for office bearer positions are to be called for by the Executive Officer no later than two (2) weeks prior to the Annual General meeting date;
  2. The Candidates for the positions in clause 14.6.1 and clause 14.6.2 should forward their nominations on the form provided to reach the Executive Officer not later than 4.30pm one week prior to the Annual General Meeting. Candidates should ensure their nomination is seconded by a current Association delegate. This may take the form of the seconder signing the candidate’s nomination form or alternatively by sending an email confirming their intent to second the nomination to reach the Executive Officer by the date of the election;
  3. The nomination can be accompanied by a brief resume setting out details of the candidate’s background in local government and the Association (if applicable) for distribution to delegates by the Executive Officer;

 

Orana Opportunity Network (ON2)

Delegates on 15th October 2021 considered a membership proposal from Orana RDA to be part of the Orana Opportunity Network (ON2) and participation in the UNSW Research Project on the Economic Impacts of Mine Automation in the NSW Orana Region.

After forwarding the proposal and documentation from the presentation to delegates, the decision has been made to join ON2 for 12 months as a Bronze member, then to reassess the benefits during the period whether to consider continuing as a member. The CEO of Orana RDA and the Executive Officer of MERC are yet to meet to finalise an agreement on what MERC seeks from the membership, to enable a fair assessment of the benefits to occur.

Meanwhile the Orana Opportunity Network (ON2) held it’s the inaugural Resources, Energy & Industry Innovation Forum in Dubbo on 17th February 2022. Its focus is to update stakeholders on what is happening in the sector, the outlook for it and the innovations that are supporting sectoral developments in the Orana and Central West region. It was a virtual event with 25 plus guest speakers. See the link below for more details:

Visit: https://info.o2n.org.au/resources-energy-and-industry-innovation-forum-2022

 

CRC for Transformations in Mining Economies (CRC TiME)

MERC is a partner with CRC TiME on a no cost but consultative basis. They have webinars and workshops on their progress with the CRC establishment and their collaboration efforts.  As relevant activities present, delegates will be kept informed on them for participation.

Their latest CRC TiME project is entitled “Robust management of mine pit lakes: reduced post-mine risk and value for communities”. They have designed a short prospectus brief of the proposed project highlighting the problem statement, how they propose to solve the problem, proposed outcomes, and benefits from the project.

The project will bring together Australia’s leading researchers in water assessment and management in an integrated approach to addressing the global and national challenge of post-closure management of pit lakes and pit voids for safe relinquishment and socio-economic value. The proposed outcomes from the project include:

  • Guidance documents or decision tree-tools for best practise for predictive modelling for pit lake water levels and water chemistry changes with time and management options.
  • Tool(s) to evaluate the risk profiles of pit lakes at local and regional scales.
  • Demonstrations and education material of how uncertainty in pit lake risk and management outcomes can be assessed and reduced.
  • Simulations of closure and repurposing at selected sites, including evaluation and optimisation of different management options.
  • Evaluation of industry best practice and development of guidance documents for different management options and their suitability in different environments.
  • Guidance documents on an appropriate business case for improved operations phase management of post-closure risk due to left-in-place pit lakes.
  • An array of educational resources for both internal (to mining company) and external stakeholders, to improve water and hydrogeochemical literacy, and cross-disciplinary understanding.

The proposed overarching project would run for five years, with sub-projects providing near term (1-3 years) and longer-term deliverables (4-5 years).

CRC TiME anticipate the project to be a significant investment with impact for CRC TiME and its partners (>$2M). They will be looking to gain additional financial support from our CRC TiME partners and external organisations to help deliver the ambitious outcomes for the project over the five years. Refer to www.crctime.com.au

 

Exposure Bill for the Mining & Petroleum Legislation Amendment Bill 2021

A letter has been received from the Deputy Secretary, Georgina Beattie from the Mining, Exploration & Geoscience Division, Regional NSW regarding the Exposure Bill for the Mining & Petroleum Legislation Amendment Bill 2021, outlined as follows:

“The NSW Minerals Strategy committed to review mining regulations, policies and processes to improve transparency, efficiency and community confidence. The review has led to a number of proposed reforms, including a set of legislative amendments to enable more efficient decision-making, streamline and modernise processes, improve clarity, and compliance. The amendments also support the NSW Government’s commitment to establish the new Royalties for Rejuvenation Fund.

A draft of the Mining and Petroleum Legislation Amendment Bill 2021 was released on the Mining, Exploration & Geoscience website, along with the Explanatory Guide. Refer to: meg.policy@regional.nsw.gov.au

All feedback will be published on the Mining, Exploration and Geoscience website early in 2022. The Bill will be introduced into Parliament in early 2022.

 

Royalties for Rejuvenation Fund Update

The Deputy Premier announced the creation of the Royalties for Rejuvenation Fund in April 2021. The 2021-22 NSW Budget committed to setting aside $25 million each year to the Fund to support the economic diversification of coal mining communities over the coming decades. Coal mining communities will have a key role to play in advising the Government on how to best invest the Fund.

The Fund will support economic diversification in the four coal mining regions. As noted in the Deputy Premier’s media release in May 2021, Expert Panels will be established with representatives from the communities in coal mining regions to input into delivery of the Fund.

The Department of Regional NSW is preparing a suite of amendments to the Mining Act 1992. As part of this package, the NSW Government is proposing to establish under legislation the Royalties for Rejuvenation Fund and its statutory expert panels. This will ensure that coal mining communities guide investments supported by the Fund.

Ahead of the Bill being introduced into Parliament, interim expert panels may be appointed for regions where short-term priorities necessitate timely advice”. Refer www.regional.nsw.gov.au for more details as this unfolds in a changing political environment.

 

LGNSW Special Conference 28th February – 2nd March 2022

MERC has a stand at the LGNSW Special Conference for the debating of motions, trade displays, workshops and conference speakers from 28th February – 2nd March 2022 in the Hyatt Regency, where the Executive Officer of MERC will attend to assist with enquiries and encourage memberships.

MERC has been allocated stand no 11, it is in a prominent position, as a 3 metre back board  with x 2 metre side panels space, with the provision of bar stool seats and a table with the MERC banner displayed and some promotional handouts available – it looks very professional, come along and chat. If you have any interested Councillors from non-members send them to the stand to discuss the benefits as a member of MERC.

 

Renewable Energy Zones

The Minister for Energy and Environment declared the CWOREZ on 5th November 2021.
The declaration is the first step in formalising the REZ under the Electricity Infrastructure Investment Act 2020. It sets out the intended network capacity (size), geographical area (location) and infrastructure that will make up the REZ. This enables and sets the scope of key legislative functions under the Act, including access schemes and REZ network solutions. 
For more information about NSW REZs please visit www.energy.nsw.gov.au/renewable-energy-zones or email rez@planning.nsw.gov.au.

A REZ is a hub of renewable projects across a region that forma a modern day power station, producing a large amount of energy for the State. The State Government has set them up in the New England, Southern NSW and Hunter/Central Coast Regions.

The REZ’s are receiving a huge interest from renewable energy businesses providing a challenge for the NSW Government to facilitate it and for local communities/Councils to grapple with. Refer article below provided by Warwick Giblin from Oz Environmental providing the details to this situation, suggesting there is an opportunity for MERC to be more involved.

“Subject: REZs – huge interest from renewable energy businesses. And a challenge for the NSW Govt to facilitate it, and for local communities/Councils to grapple with

https://reneweconomy.com.au/nsw-swamped-by-34gw-of-wind-solar-and-storage-for-new-renewable-zone/

Current MERC process for involvement in the REZ’s is by receiving minutes from each REZ Regional Reference Group meeting and forwarding them to members (which attendances at and the staging of them have been affected by COVID during 2021). MERC does not have members in every REZ that is being established..

If MERC is to get more involved in the REZ’s it would need to have a discussion at a future meeting to review the current Strategic Plan actions and how it would like to resource any actions if it were to become more involved in the processes across the whole of the State given the growth of the REZ throughout NSW as outlined in the following article.

 

Rating of Mining Land Relative to Business Rates Update on OLG Guidelines

This item is re-submitted given its importance to MERC members and for the interest of new delegates. The Minister for Local Government, Hon Shelley Hancock, had written to MERC on 25th March 2021, confirming that the NSW Government have accepted IPART’s recommendation that mining rates should be set relative to busness rates, primarily to reflect differences in the cost  of providing council infrastructure and services to these properties.

The Minister also indicated that the NSW Government are not contemplating legislating to limit how mining land should be rated relative to business rates by local government, instead Guidelines will be prepared for the local government sector.

In reply, MERC wrote to the Minister offering the expertise of members of MERC to be part of the working party to write the Guidelines. Since then the Local Government Amendment Act 2021 has been passed and some of the changes adopted from the IPART recommendations have been implemented effective from 24th May 2021, with more to come.

In the meantime, the Minister has advised that a Local Government Rating Reference Group has now been established to provide technical input on rating issues and advice how best to meet Council’s operational needs during implementation of the mining rates relative to business rates.

Following an EOI process, an intitial meeting was held on 3rd November 2021, with the Reference Group, where rating professionals from Wollonging City, Wollondilly, Blayney, Singleton, Cessnock and Mid Western Regional  Council’s are members of the group. Four of these Council’s are members of MERC so our issues of concern should be raised.

The Minister thanked MERC for bringing this matter to NSW Government’s attention. If there are any queries the OLG Policy Team can be contacted on 02 44284100 or by email to olg@olg.nsw.gov.au

 

Discussion Paper on  Reliable Energy Supply and Coal Mining Options

At the 15th October 2021 Ordinary meeting, delegates discussed the inadequacies of the existing energy supply networks using examples in Cobar, Lachlan and Warren Shire Councils where the need exists to upgrade existing energy supply assets to provide reliable energy supply to regional industries and communities.

A working party was established consisting of Crs Dom Figliomeni (Wollongong City Council), Mark Hall (Lachlan Shire Council) and Chris Roylance (Forbes Shire Council) and Executive Officer to develop a discussion paper for distribution to delegates. Some excellent details have been gleaned to date and will be distributed to delegates in due course as information and possible action by respective members and MERC, in due course at a future meeting.

The completion of this paper has been affected by the lead up to the December elections and the loss of Mark Hall who was a driving force in the content. It is good to see that Councillors Figliomeni and Roylance are still part of MERC and able to finalise this project paper.

 

Related Matters of Interest – Mining and Energy Issues

“Snowy Hydro Gets Green Light for Dirty, Unnecessary & Expensive Gas Plant” 7th February, Michael Mazengarb , www.reneweconomy.org.au writes: “The Morrison government has given environmental approval for the construction of a new $600 million gas-fired power station in the Hunter region, a plan criticised for being expensive, unnecessary, and locking in the increased use of fossil fuels.

The Kurri Kurri gas generator, to be built and operated by the federal government-owned Snowy Hydro, has been granted federal environmental approval, clearing the way for the taxpayer-funded project to commence construction. Federal environment minister Sussan Ley made the announcement on Monday – ahead of the first parliamentary sitting week for the year – and it follows planning approvals granted by the NSW government in December.

Ley said the project would proceed with a requirement that it must satisfy the conditions imposed by the NSW state government during the earlier planning approval process. “This thorough bilateral assessment with NSW has paved the way for the development and operation of this new critical infrastructure in a way that sensitively manages, protects and rehabilitates the environment,” Ley said. “However, the project has been slammed by environmental groups and senior energy market analysts who have labelled the project as “dirty, unnecessary and expensive.”

Energy expert and member of the Climate Council, Dr Madeline Taylor, said the emergence of lower-cost clean energy technologies created the genuine prospect the Kurri Kurri gas generator could become a stranded asset, leaving Australian taxpayers exposed to the investment risk. “As renewable energy and storage technologies become cheaper by the day, this short-sighted investment in a new gas-fired power station, built with taxpayer money, makes no sense from an energy or economic perspective, and will likely end up as a stranded asset,” Taylor said.

“We need a total transformation of our electricity system based on renewables and storage technologies. Gas for electricity generation is often expensive, inefficient, and not commercially viable. At a time when the world is turning away from gas-fired electricity and embracing renewables, Australia could rapidly decarbonise and become a renewable energy superpower, but instead, public money is being funnelled into a project potentially representing a liability to our clean energy future,” Taylor added.

Snowy Hydro will construct the Kurri Kurri generator after receiving a $600 million capital injection from the Morrison government to fund the project. The Morrison government decided to proceed with the project after having claimed that at least 1,000MW of new dispatchable generation capacity would need to be built to maintain reliable supplies of electricity after the closure of the Liddell power station – despite energy market regulators insisting the actual new-build requirement was just a fraction of that amount.

Gas generators supplied just 1.5 per cent of New South Wales’ electricity supplies in 2021. The market share for gas in New South Wales has collapsed since 2013, when it reached 6.5 per cent for the year, as the growth of lower-cost supplies of wind and solar pushed it out of the market.

Business case documents released by Snowy Hydro suggest the Kurri Kurri plant may operate for the equivalent of just two per cent of its rated power output across an entire year, meaning the project will be reliant on periods of higher wholesale electricity prices to generate sufficient revenues to be viable.

Chief executive of the Clean Energy Council, Kane Thornton, said that a big battery project would deliver better outcomes for consumers, while avoiding the need to be supplied by fossil gas. “The Kurri Kurri plant is only expected to run for about one week of every year. When battery storage can deliver a cost saving of 30 per cent while delivering greater flexibility and significantly reducing emissions intensity, it makes no sense to be spending taxpayer dollars on this fossil fuel project,” Thornton said. “It sends the wrong message to clean energy investors and to communities at a time when the International Energy Agency says that there is no space for new fossil fuel developments if the world is to reach net-zero emissions by 2050.”

Gas market analyst, IEEFA’s Bruce Robertson, said progressing with the new gas plant would ultimately lead to higher electricity prices for consumers by forcing unnecessary and high-cost generation capacity into the grid.

“The Australian Energy Market Operator has said we do not need any new gas-fired power plants, the electricity they produce is very expensive and producing more expensive electricity will force up the price for consumers,” Robertson said. “The Kurri Kurri gas plant comes at great cost to the Australian taxpayer who will be subsidising this white elephant.”

After initially criticising the Morrison government’s plan to build the new generator at Kurri Kurri, the federal Labor opposition has said it will instead back the project, on the condition that it is transitioned to hydrogen fuel as soon as possible.

Labor’s proposal – which could add a further $700 million to the cost of the project to convert the plant to run on hydrogen – has also been met with criticism. As Mountain outlined in a piece for RenewEconomy, hydrogen for power generation is currently one of the most inefficient uses of the fuel.

350 Australia Senior Campaigner Shani Tager called on the Morrison government to cancel the planned investment in the Kurri Kurri project, arguing that the construction of a new fossil fuel generator was incompatible with commitments to decarbonise Australia’s economy.

“If the Morrison Government had any sense, they’d pull the pin on this expensive, polluting gas power station that the market has said we don’t need. Instead, they’re pushing ahead, and we’ll all be left footing the bill,” Tager said “Not only is this burning public money, it flies in the face of climate science with the International Energy Agency saying there’s no role for new gas projects on the pathway to net zero emissions by 2050. Even the Liberals own energy market operator says this isn’t needed.”

“Look No Fossil Fuels: Remote Town Transformed by Solar and Wind” Sophie Vorath, writes February 2022, refer www.reneweconomy.org.au “Western Australia has flicked the switch on one of Australia’s largest and most sophisticated microgrids, a 5MW mix of solar, wind and battery storage that will have the ability, if required, to power the Mid West town of Kalbarri entirely with renewables.

The Kalbarri microgrid, which combines 1.6MW of wind generation capacity, 1MW of “mum and dad” rooftop solar and 2MWh of battery storage, differs from most in that it has no fossil fuel back-up. That’s because the microgrid, itself, is the back-up – in this case, for the main grid. Government-owned network company Western Power developed the microgrid in partnership with utility Synergy, the Shire of Northampton and the local community, to address ongoing reliability issues that have plagued the tourist town.

Kalbarri, which has roughly 1,500 residents and attracts more than 100,000 visitors a year, is connected to the state’s South West Interconnected System – Western Australia’s main grid – by a 140km long rural feeder line from Geraldton.

This “infamous” line, as Western Power’s Aaron Fawcett describes it, is “very open to the elements and has given us a lot of trouble in the past;” namely regular and sometimes prolonged outages. The new microgrid has been connected to the existing network infrastructure to help meet peak demand in the town during tourist season. But it’s more important role will be to take over the power supply, entirely, when the network connection is, inevitably, interrupted, by storms, wind, or sand.

For this role, the microgrid will use intelligent monitoring equipment to detect a fault in the system and respond to maintain power supply for the town, “islanding” it by drawing energy solely from the battery, the wind farm and feed-in from residential rooftop solar panels. “The beauty of this particular BESS [battery energy storage] solution and the complexity around the management system of it is that it also detects when the network comes back on line,” says Derrick Quick, the project manager for the microgrid. “It will then disconnect from the battery and then reconnect to the grid.”

Western Power says the microgrid’s advanced monitoring system will detect even momentary outages, responding in milliseconds to maintain a seemingly uninterrupted power supply. According to a project fact sheet, the changeover from grid to microgrid supply may trip some household appliances, but the majority should not be impacted and most customers should not even notice either the outage or subsequent reconnection.

Indeed, they might be none the wiser about future disconnections from the network, but for an automated notification sent to mobile phones so residents can adjust their power usage while the microgrid is operating, to make the most of the battery charge. All told, the Kalbarri microgrid is expected to eliminate 80 per cent of outages experienced by the town, and significantly reduce the length of outages depending on how the power is being drawn from the microgrid.

“The Kalbarri microgrid is an important step towards improving power reliability for the local community,” said state energy minister Bill Johnston, who oversees the Labor McGowan government’s Distributed Energy Resources Roadmap. “It also paves the way in delivering greater renewable energy solutions across WA, particularly in regional areas, as we move forward in achieving net zero emissions by 2050.”

 

 

Disclaimer The comments and details in the articles in this newsletter do not reflect the views, policies or position of the Association or its member Councils and are sourced and reproduced from public media outlets by the Executive Officer to provide information for members that they may not already be exposed to in their Local Government areas

Contacts

Clr Michael Banasik (Acting Chair) michael.bansik@wollondilly.nsw.gov.au  0425798068 or Greg Lamont (Executive Officer) 0407937636, info@miningrelatedcouncils.asn.au.