Location: Banana Shire, Queensland
Population: 14, 513 (2021 Census)
Main communities: Banana, Biloela, Theodore, Taroom
Fast facts:
- Located 120km, southwest of the rapidly expanding industrial city of Gladstone the region’s primary industries have historically been coal mining, beef production, power generation, dryland and irrigated cropping
- Rich in natural resources, including undeveloped coal deposits and coal bed methane gas
- The third largest producer and exporter of meat in Queensland
There are 13 wind and solar project current planned for the Banana Shire, with the potential for more, and local leaders are interested in building local industry capacity to leverage these proposed developments.
STRATEGIC INITIATIVES FOR NET ZERO TRANSITION
Banana Shire is well-positioned to play a large role in Queensland’s plans to reduce the state’s reliance on fossil fuels by 70% by 2032, with a focus on establishing a renewable energy ‘super grid’ through combining wind, solar and hydrogen generators. There are currently 13 major renewable energy projects in the pipeline across Banana Shire with one committed and 12 yet to be confirmed. The shire hopes that the construction of 13 renewable energy power plants will be a major boost to the local construction industry. It’s estimated that the power plants themselves will create 100 to 200 construction jobs per site. With an already low unemployment rate, the shire hopes to attract more people to live in the area which will also require the construction of new residential houses, which would further boost economic activity in the region.
CONTEXT
The Banana Shire has a rich resource and agricultural heritage with several mines operating that provide coal for the Callide Power Station and for export. Around 12 million tonnes of coal was produced locally during 2021-22. The Callide Power Station is expected to close within 10 years but the shire anticipates at this stage that coal exports will continue for some time. The Queensland State Government Regional Energy Zone program has identified opportunities in the region that will capitalise on the local economy and connected grid infrastructure through energy transformation. With increased renewable energy, it is anticipated that industries such as agriculture, construction, mineral processing and manufacturing will be supported to grow and decarbonise.
NET ZERO
From a pragmatic viewpoint, there is growing local awareness and recognition of the reality associated with new renewable energy projects, including solar and wind investment, as well as broader reductions in the use of fossil fuels. This is creating a need to prepare for a long-term transition over the next 10 to 30 years, taking into account the anticipated life of coal exports as a contribution to the economy.
Local governments and businesses are seeking to take advantage of the current strength in the existing industrial base while also exploring future opportunities for the shire, including the renewable energy sector. This is the path being pursued to navigate from legacy carbon-based industries to low-carbon-focused industries.
DRIVERS
The Banana Shire Council recognises that planning for change is key to reducing negative impacts on business and the community and that it is important to support businesses to adapt and take up new opportunities. It is pursuing a deeper understanding of the eventual closure and potential future of the existing mines locally and what new opportunities may arise. Given there are 13 renewable energy projects (wind and solar) currently planned with a potential total of 30, there is interest in building local industry capacity to leverage the development of renewable power generation.
State government control of decisions on the planning approvals and development of current renewable energy projects appears to have created a disconnect with local participation and decision-making. There is local recognition that the progress of these projects will continue and that work needs to be done to create benefit for the broader community beyond local business. It is anticipated that an increasing availability of services, including infrastructure and planning needs will be required due to the planned growth and development.
In addition, there is recognition that opportunities to grow and diversify key industry strengths such as agricultural production in the shire are required, including greater value adding and processing of different meat, dairy, horticulture, cereal crops and plant-based proteins.
DEVELOPMENT
The shire is working with larger key industry groups to plan for transition and possible future opportunities as businesses prepare for decarbonisation. A working group of key local industries has been established to share and identify common plans for the future, potential opportunities, challenges and needs.
Consideration is also being given to how to attract new businesses to the area as well as skilled workers. Promotion of the region is seen as critical to success, with jobs still available in the coal industry for some time which may attract workers from other regions experiencing earlier closure of coal mines. The shire has also identified the provision of industrial land to attract interested businesses to relocate and establish a local presence.
One example of new business attraction and investment to the region is the interest of Released Energy Pty Ltd to apply innovative technology solutions to decarbonise already established local industries and emerging new ventures.
Released Energy Pty Ltd partners have undertaken investigations in Australia, Europe and the US, identifying particular companies that are developing applicable new technology suitable for regional Australian energy and circular economy needs. Efforts are being focused on an opportunity to manufacture alternative battery technology (non-lithium-based) for energy storage through a US manufacturing company with a manufacturing site to be established locally. The land is being leased in anticipation of proceeding with a manufacturing site build. Given the number of wind and solar projects under development in the area, this could be of benefit and a competitive advantage.
There is an understanding that for success, the right conditions are required, including social and environmental benefits as well as economic and business outcomes. An understanding of the long-term nature of the transition of skills and supply chain, business operations, along with protection against unintended consequences and the need to understand the current context, attitudes and practical aspects, like planning and regulation requirements, are central to the work underway. In particular, spending time to build relationships with key organisations in the community and gaining an understanding of the specifics of what matters to people are seen as important for social licence.
PARTNERSHIPS
Local government plays an important role in leading larger business and industry collaboration for the purpose of developing an understanding of the potential net zero economic changes and opportunities. One example of this is the work the shire has undertaken with Queensland Nitrates Pty Ltd (QNP).
QNP, established 24 years ago, is a fully integrated ammonium nitrate manufacturing company based in Moura, Queensland, providing explosives to mining companies for extraction of minerals and coal, and currently a joint venture between Wesfarmers and Incitec Pivot Limited. It is pursuing opportunities for harnessing potential in greenhouse emissions reduction within its business and with current and other partners with the aim of a 30% reduction by 2030 and 100% by 2050. A consortium of four companies undertook a feasibility study in 2020 to develop a hydrogen hub in the Moura region to supply green hydrogen to mines, transport and QNP.
A challenge as well as an opportunity is applying the technology and pricing structure required to produce green hydrogen through electrolysis at a scale that can be commensurate with the price QNP currently manufactures hydrogen. Identifying and working with companies that are already designing and installing engines for trucks of this kind with a five to 10-year timeframe — such as First Mode Pty Ltd — are important steps to building a connected system of supply chain and technology over a timeframe that is interrelated across the businesses.
Important to the broader vision for net zero in the Banana Shire is the role that the local council is playing in bringing together key industries that are exploring new business models to reduce emissions. The council, led by the Mayor and CEO, have established a Clean Energy Transition Industry Network that meets regularly and is made up of core local industries (power, mines, meat works, supply chain). It also provides an opportunity to connect with broader consortia and investment opportunities.
It has been recognised that there is a need to act locally, separate to state and federal government action, where there is an understanding of the regional context and opportunities. Current programs for early seed funding are not always locally inclusive, adaptive or timely, or identify early local entrepreneurship for support. There appears to be a lack of process for a broader connection and support to work already underway, which is an opportunity in itself.
CAPABILITIES
Research participants noted that funding is scarce and local governments are understaffed, forcing local leaders to prioritise their community issues on a sliding scale of needs and capabilities. This is particularly problematic for smaller local governments, which typically have fewer than half a dozen staff and service communities with fewer than 1,000 residents. For example, many participants recounted having to drive five to eight hours for a meeting with state government departments in Perth and back to their offices the next day for local commitments. The safety of the roads and exhaustion experienced from driving long distances were discussed among participants, but with inadequate staff available in town, they had to assume additional responsibilities. Regarding hiring personnel with specific skills or experience, participants noted the significant costs associated with bringing experts into town, if they could secure someone at all, to satisfy the requirements of energy ratings of new builds being up to code.
Constraints of limited funding and staff capacity are also experienced across regional, state and federal government agencies including the Mid West Development Commission and RDAMWG. Community members and local governments, while appreciating the assistance of each organisation, were quick to note that they too were limited in how much they could assist with energy transition planning and projects due to limited resources.
SUCCESS FACTORS
Banana Shire is in the very early stages of broader transition planning and implementation and is in some ways applying a standard approach to economic expansion and diversification, for example, through attraction, promotion and planning assistance working directly with businesses.
It is apparent that industry-led transition is the focus — with support from council — to understand the current context and consider net zero opportunities. The examples of this as described indicate that entrepreneurial businesses are already seeking new ways of working. Aspects of exploration include technology solutions, local partner supply chains, co-contributors to potential new products, waste recycling and new energy sources across industry groups.
At this stage, it appears that work is yet to be done on investigating or developing a potential transition plan that considers broader requirements. There is no indication that any mapping or study has been undertaken to look at the implications and opportunities expected from renewable energy projects, for example, future skill requirements, training programs, supply chain opportunities, preparation and support for small businesses, further research and mapping the role of cross sectors.
Given its size and capacity, one of the current challenges identified for the council is having the time and capacity to undertake the careful work required to support local small businesses and to build knowledge and understanding of current opportunities. Small businesses play an important role in the local economy, including employment and a range of services, and need to prepare for and consider a future in the context of net zero transition.
CAPABILITIES
Identified in discussions was the issue of capacity and readiness for the task of supporting a community to understand and acknowledge the reality of change underway and required for net zero. The general population including the small business community, other sectors and community groups appear to be at a very early stage of engagement. While there is some knowledge and acknowledgement of the current policy and emission reduction target agenda, generally this has not resulted in acceptance of the need to act. Given near full employment, small businesses with plenty of work, and coal exports still a significant industry, the imperative for change has not yet appeared or impacted more broadly.
With limited resources to undertake additional work to address this situation and the effort required to build the case for change, the council must plan for potential changes to resource allocation, for example, new planning and services along with supporting small businesses to adapt. Securing the resources to commit to this work and the available capacity and capability for preparing for what is coming remains an issue. There appears to be an understanding of the tasks at hand, however having the time, expertise and resources to do what is required over time is a fundamental problem.
FUTURE STEPS
Both Banana Shire Council and lead businesses involved in discussions were buoyant about the future of work underway and realising the potential of net zero opportunities locally.
It was evident that further work associated with cementing partnerships — both locally and internationally — was important to building confidence in concepts adopting and investing in new technology and investigating cost feasibility in the startup phase.
Early work is underway with consideration of future potential including scalability and diversification across multiple partners for mutual benefit, exploring a systems approach. Up front capital remains a real issue, particularly where innovation is involved and where local entrepreneurs are the lead.
Experience applying for government grants indicated that those who have the resources, capacity and proven background (usually bigger and better-known companies) appear to be more successful in receiving funds but these are not necessarily locally connected, which matters greatly in terms of the trust, relationships, long term commitment and care for the community and building resilience for the future.
This case study is an excerpt from Towards Net Zero: Empowering Regional Communities, which was released in August 2024, under the Intergovernmental Shared Inquiry Program.
This report was funded by the Australian Government, in conjunction with the NSW, Queensland, South Australian and Western Australian Governments.