Australia Sets Up Global Body to Promote Clean Coal

By Gemma Daley

Sept. 19 (Bloomberg) -- Australia's government set up a A$100 million ($80 million) global clean-coal institute to encourage companies such as BHP Billiton Ltd. to establish low- emissions power projects that help tackle global warming.

Prime Minister Kevin Rudd, who ratified the Kyoto Protocol on his first day in office and wants to cut emissions 60 percent by 2050, announced the plan in Canberra today.

``Our intention with these projects is to reduce greenhouse gas emissions,'' said Rudd, 50. ``This is an important area to achieve real results.''

The government wants to promote projects that use new technology to help reduce emissions of carbon dioxide and other gases blamed for global warming. The institute will promote the development of clean-coal ventures and help them raise funds, Rudd said. Resources and Energy Minister Martin Ferguson said BHP and the Rio Tinto Group back the initiative.

``BHP Billiton is very committed to the reduction of C02 in the atmosphere,'' Chief Executive Officer Marius Kloppers said in an interview today. ``We believe the science is real, we believe it's highly necessary to stabilize C02.''

Australia's upper-house senate is expected to approve legislation allowing the country to set up storage sites off its coast to hold carbon captured during power production, Ferguson said. The House of Representatives passed the legislation yesterday, he said.

Governments may participate in carbon-capture projects, said Rudd, who will brief the United Nations General Assembly on the institute in New York next week.

The aim is to have the institute operating by January, Rudd told reporters. It will be based in Australia, with the location still to be decided, he said.

To contact the reporter on this story: Gemma Daley in Canberra at gdaley@bloomberg.net