The Deloitte Access Economics (DAE) assessment of the economic impacts of the Mt Owen continued operations project has significant flaws which overstate the value of the project and mislead decision makers.
The assessment does not make clear the costs and the benefits of the project to NSW, contrary to Director Generals Requirements. Instead, it compares international financial impacts which largely accrue to overseas shareholders with the environmental costs of the project which are borne by NSW.
The environmental costs of the project to NSW are understated as the assessment assumes that biodiversity offsets work immediately, perfectly and permanently. This is contrary to the opinions of ecologists. Given the project will have a serious impact on endangered fauna species such as the spotted tail quoll and swift parrot, as well as endangered ecological communities, this is a serious shortcoming of the assessment.
The question facing decision makers that DAE fail to ask is: are the impacts of the project on the NSW environment worth $28 million per year for 15 years, or present value of $258 million, or increase of 0.04 per cent of revenue?
While ignoring the net benefit of the project to NSW, the assessment offers an estimate of benefits to Singleton. This is based on unrealistic wage and employment assumptions, contrary to NSW government guidelines and in contrast to other reports by DAE.
Other issues around coal prices and sensitivity testing should also be clarified.
In many ways the DAE assessment is of a far higher standard than most economic assessments of coal mines in the NSW planning process. While a welcome step in the right direction, there is still a long way to go before decision makers are given objective analysis under the current planning process.