Rural and Regional Affairs and Transport Legislation Committee
INFRASTRUCTURE AND REGIONAL DEVELOPMENT PORTFOLIO
Australian Rail Track Corporation
Senator RHIANNON: Yes, thank you. Is the Australian Rail Track Corporation helping to fund the New South Wales Minerals Council to undertake a study of coal dust from coal trains in the Hunter?
Mr Fullerton : No, it is not. It is part of a group that is being led by the Minerals Council. They have launched a project that was announced in the press a week or so ago, to try and assess the impacts of dust in the Hunter Valley. We are part of that group, but that would be funded by the coal producers.
Senator RHIANNON: In the Newcastle Herald on 17 February, Mr Galilee, from the New South Wales Minerals Council, is reported to have said 'rail companies, including the track operator Australian Rail Track Corporation, coal companies and port companies were helping fund the studies'. Are you saying that is not correct?
Mr Fullerton : All funding is ultimately paid for by the coal producers. It is no different to when we build the track, which we pay for up front, and we get a return on that investment. As we do get a return when we spend money on the maintenance of the track, this cost simply is a recovery under our access regime.
Senator RHIANNON: So, going back to my original question, you are helping fund this study from one of your sources of revenue?
Mr Fullerton : No, we are not funding it.
Senator RHIANNON: Well, let us unpick that, because I understood in the second answer that you gave that the costs of this study are being covered by the revenue that comes in.
Mr Fullerton : The decision to put this study together came at the request of the coordination of the Minerals Council, and we are part of that, and the Minerals Council, through the coal producers, are funding that study.
Senator RHIANNON: And the producers get the money from?
Mr Fullerton : From their own resources.
Senator RHIANNON: So there is no involvement you have at all—
Mr Fullerton : We are part of the project team, along with the service providers; the rail operator companies, that work together as a group to assist in the management of this project.
CHAIR: I presume that would be a tax deduction to the miners?
Mr Fullerton : I cannot comment.
Senator RHIANNON: From your answer, I take it that there is no money involvement, but the New South Wales Mineral Council is undertaking this study. Why would you involve such a partisan body in undertaking this study? Mr Galilee has recently said 'there is no scientific evidence to demonstrate that covering wagons will be anything more than an expensive public relations exercise'. That is his comment. And now you have that person undertaking this study. We know these studies have been so controversial. Why did you involve him? Why are you linking ARTC with this study?
Mr Fullerton : Because ARTC is part of the coal supply chain in the Hunter Valley. We provide infrastructure to carry coal through to the port. We work very closely with the coal companies in that matter, and we work very closely with the rail operators. I think it is important that ARTC work with all its stakeholders in the Hunter Valley to allay community concerns about coal dust and air quality.
Senator RHIANNON: You talk about allaying community concerns, but the ARTC have already been associated with two reports that really have damaged your reputation because of the flaws that were identified in the methodology and the data analysis, and those flaws were not included in the final reports that the ARTC puts out and supplies to the NSW EPA. So you have been associated with flawed reports, and now you are working with a partisan body. How can you say you are addressing community concerns? If anything, you have gone in the opposite direction; rather than working with the community, you are working with a partisan body, on the issue of coal dust—where they are saying they do not need to cover their wagons.
CHAIR: I do not know where this is going, but obviously—
Senator RHIANNON: It is going very clearly, Chair, in the direction that he should answer the question.
CHAIR: Obviously I have not been smart enough to pull up and just wipe my finger along the railway line—there is coal dust on it. Obviously coal dust comes out of coal trucks, and obviously that is the coal industry's problem, but is it the ARTC's problem?
Senator RHIANNON: They are part of this. Mr Fullerton has acknowledged that in part of his answer. They have got involved in the study; they are part of the chain of supply with the producers in the valley.
CHAIR: The dust thing is real, I accept that. There was a Japanese company in the Hunter five or six years ago that bought the dairy farms around it and said you can lease it back for a dollar a year so the dairy cockies kept going and within 18 months they had to shut down because the milk was contaminated and the water was contaminated and the pasture was contaminated. It is a real problem
Senator RHIANNON: Mr Fullerton, can you respond to why you went with such a partisan body that has got a clear position that covering the coal wagons is not required?
Mr Fullerton : Because I think it is important for the industry—and we are very much a part of the coal industry in the Hunter Valley; the coal industry is the primary reason that we have upgraded the network and provide a network to deliver coal through the Hunter Valley for export—to work together as a group to allay community concerns, and that is exactly what we are doing in the work that we are doing with the mining council and the rail operators such as a Asciano, Horizon and Freightliner, and also the terminals, to organise ourselves in a way that we can carry out projects and carry out investigations to allay community concerns.
Senator RHIANNON: But if you want to allay community concerns you cover the wagons. This has gone on for years and years now and it really must be embarrassing that it is another study that you pull out of the hat to make out that something is being done. Are you aware that two reports recently commissioned, one by the New South Wales government, the Katestone one in 2011, and the Queensland Rail Connell Hatch report, recommended covering coal wagons? Have you looked at those reports?
Mr Fullerton : I am not familiar with those two reports.
Senator RHIANNON: As the licensee for coal transit, has the ARTC assessed the costs and benefits of covering coal wagons consistent with recommendations of the 2013 Senate inquiry into the health impacts of air pollution?
Mr Fullerton : No, we have not. We are not experts in coal wagons and it is a matter for service providers to form that view in terms of the costs. We have not been provided with any evidence by any of the parties to suggest that that is a solution. There is further work being done of course in terms of air quality monitoring. The EPA have just announced that they have established three permanent monitoring sites at Carrington, Metford, and Stockton, and the final report that ARTC coordinated 12 months ago with Katestone has been the subject of a peer review by the EPA. We are waiting on the response from Professor Louise Ryan, who has undertaken that review.
Senator RHIANNON: Considering you are now involved in this latest study with the New South Wales Minerals Council will it be a requirement for that study that it assess the costs and benefits of covering coal wagons consistent with the recommendations from the Senate inquiry?
Mr Fullerton : No, I think you need to refer that question to the Minerals Council. They issued a press release a couple of weeks ago to say that they have set up this project team to look at the extent of the problem and what other options are available to minimise emissions from coal trains.
Senator RHIANNON: Does that mean the ARTC is not giving any direction to that study even though you have said that there is some link there? Does that mean it is a hands-off approach?
Mr Fullerton : The ARTC has always made its position very clear: that we are not experts in this area. We conduct those two reports under the pollution reduction scheme that was part of the EPA requirement initially in March 2011, and there was a second monitoring arrangement in January 2012 because they wanted to do the second test in dry weather. We have conducted both of those monitoring programs in very close association with the EPA under our licensing arrangements. Both those two reports were provided to the EPA.
Senator RHIANNON: In that question I was not saying that you are an expert and I was not saying that you indicated that the coal wagons should be covered. All I asked—and I would ask you to answer it—was will you be requiring that assessment be made of the costs and benefits of covering coal wagons? Surely, if you have linked with this New South Wales Minerals study, from a biased partisan body, you should be putting up some standards?
Mr Fullerton : No, we will not be involved in that; we will be leaving that as a matter for the EPA.
Senator RHIANNON: So you are leaving it up to the New South Wales Minerals Council to run this study?
Mr Fullerton : No. The EPA are vitally involved in air quality monitoring in the Hunter Valley and they have got a very close involvement in this exercise. That is why they themselves have asked us to do those two studies. It is why they have put in permanent monitoring at Metford, Carrington and Stockton recently. They are doing further testing of particulates—that has been established at four other sites. They are very conscious of air quality, to the point that, when there were some concerns raised about the statistical analysis that was undertaken with the recent Katestone study that we put in place 12 months ago, they initiated a peer review using Professor Louise Ryan.
Senator RHIANNON: You also worked closely with the EPA in the last two reports, which have been controversial. Did you also talk to them about their response and the levels of particulate matter?
Mr Fullerton : Not at all. I think we were all guided by what those studies summarised. The ARTC certainly has not jumped to any conclusion that coal wagons need to be covered because the evidence is not there to suggest that that should be the case.
CHAIR: For the first few miles from the loading, there is obviously dust coming out of the wagons. When you get down the railway line, there is obviously not as much dust. But this is intriguing. There is dust coming out of it. Surely, as a normal human being who understands coal dust, you will recognise that—
Senator RHIANNON: Chair, can you ask Mr Fullerton to answer that question. Do you acknowledge that coal dust comes out of coal wagons?
Mr Fullerton : I would prefer that the question be answered by the EPA because they are the experts in this field. The two studies we undertook on behalf of the EPA came up with the view that there was no statistical variation between different types of trains running across those two monitoring sites.
Senator RHIANNON: But shouldn't you have been comparing trains to no trains? That was part of the flawed way of that methodology that you compared coal trains to other trains. Shouldn't you have been comparing coal trains to when there is no trains to look at the level of the dust? Why wasn't that done?
Mr Fullerton : Because that was a matter for the EPA, who specified the scope of that questioning.
CHAIR: Where are the testing points where they do the monitoring? Are they at mid-journey or are they at the beginning of the journey?
Mr Fullerton : The one at Metford is at Newcastle, in the lower Hunter.
CHAIR: At the end of the journey?
Mr Fullerton : At the end of the journey.
CHAIR: That is bullshit—that is technical; it is coal dust! At the end of the journey the dust is all gone. I mean, whose leg are you pulling?
Senator RHIANNON: This study is entirely flawed.
CHAIR: I am a farmer. There is an obligation to cover your load, or the RTA or whoever will fine you. If your monitoring point is at the end of the journey, by the time you get there all the top dust is well and truly gone. So that is just—you heard what I said.
Mr Fullerton : There are three monitoring sites.
CHAIR: But where are the others? If they are not in the first few miles—
Mr Fullerton : The EPA have got a whole network of monitoring sites throughout the Hunter Valley. They have got monitoring sites up in the Hunter Valley, where the coalmines are located. This particular monitoring for coaldust was in Newcastle because it was going through built-up areas, where people had a particular concern.
CHAIR: I have had a bit to do with covering trucks—as I am sure Senator Sterle has. If you have a winding cover, it is all right with wheat and that; but, with coal, there would be chunks of coal going over the side and putting holes in your tarp. It would be a bit of a pain in the backside.
Senator RHIANNON: Don't let them off the hook, Chair; they have to cover coal trucks. In this day and age, we have technology—as though a coal lump has to knock a hole in the cover!
CHAIR: I just said that. You can actually be fined if you do not cover it. Anyhow, I am sure that Mr Galilee is as independent as the person who pays him!
Senator RHIANNON: Thank you, Chair; that was a good comment. Mr Fullerton, were you aware that the technical reviews of your two reports noted that there were significant spikes in pollution as coal trains passed? Are you aware also that these reviews said there were flaws in the methodology and data analysis? I am interested in what your understanding of that is and also in why these reviews were not incorporated into the final reports—those very issues about the flaws.
Mr Fullerton : The only report that was subject to further work was the second report that was undertaken by Katestone in January 2013. That came about because of questions that were raised about the statistical methodology that was used. The EPA, at their initiative, had a number of peer reviews undertaken of that report. Those peer reviews came back and questioned the methodology that was used—it is quite a complex process. That is when they engaged Professor Louise Ryan to complete a peer review, and her report is due to be released shortly.
Senator RHIANNON: But my understanding is that it was known that there were flaws in the methodology and the data analysis before the final report came out—because we have seen that information about the alteration of some paragraphs. Why wasn't it noted in the final report, when it came out, that there was at least a dispute about the methodology that had been used?
Mr Fullerton : I am not familiar with that. There were a number of draft reports, which is standard practice. It went back and forward between Katestone and the EPA prior to this report's release, whereby they commented on methodology and so on. The EPA were more than satisfied to release that report once those various iterations occurred. It was only subsequent to the release of that report that there were concerns raised about the methodology that was used. I think Dr Knibbs was the first person they brought in, and then they brought in Professor Louise Ryan. Their concerns went to the statistical analysis that was used to assess the data between empty coal trains, loaded coal trains, passenger trains and freight trains. It was subsequent to the release of that report.
Senator RHIANNON: You said 'only became aware of' after the report. I think what you meant is 'only when it became publicly known'. When you look at the documentation, clearly within the ARTC and the EPA there was correspondence—because the emails were going back and forwards. So you already knew that there was this controversy. So I go back to my question: why wasn't it at least acknowledged, in that report that you gave to the EPA, that there was some dispute about the methodology? Wouldn't that have been reasonable?
Mr Fullerton : I am not too sure that they are related. The report that went back became public because a draft report was released—and we have also decided to put on our website, which is available to people, that draft report and all the analysis that was measured during that one-month trial. The initial iteration that was going on before that report was finally released was between the EPA and Katestone about how the material was presented and how the analysis was conducted. I am not sure, but I do not think it was the case that they identified a statistical problem in that report prior to its final release. It was only afterwards, when the draft report became available—when there was a disconnect between some elements of that that raised some public concerns—that the EPA initiated the peer review by Dr Knibbs in the first case and then by Professor Louise Ryan in the second case, in which they raised some concerns about the approach to the analysis. And that has been a report that is now part of a peer review.
Senator RHIANNON: Did you or anyone from the ARTC have any communications with the New South Wales Environment Protection Agency or the New South Wales environment minister or somebody in that person's office about how they intended to respond to these reports?
Mr Fullerton : Was that before that final report was released?
Senator RHIANNON: Yes.
Mr Fullerton : Obviously we engaged Katestone, and therefore reports would come to us that we put onto the EPA. But it was really a matter between the two technical experts, which in this case were the EPA and Katestone.
Senator RHIANNON: My question was: did you have communications with the EPA or the minister's office, or somebody associated, about how you would manage the controversy about the different versions of the report?
Mr Fullerton : We did not see it as a controversy to have the different versions of the report because we believe it is standard practice to do various iterations before the final report is released. The last thing you would do is release a report that the EPA have not had a chance to review, question, query—and that is what they did on numerous occasions so that everybody was satisfied when that report was released that—
CHAIR: Obviously there were crossed communications.
Mr Fullerton : There were a lot of crossed communications.
CHAIR: As you know, if you do not agree with someone's science, you get someone else's science; you pay for your version of the science. But it is extraordinary to me that you are breaking the law if you do not cover a motor truck but you are not breaking the law if you do not cover a rail truck with coal. As I said, it is BS! Best of luck.