The industry’s contribution will be sourced from its COAL21 fund – a $300 million fund voluntarily set up by coal producers to support the development of low emissions technologies for coal.

The new program includes a statewide assessment of NSW’s potential for geological storage of carbon dioxide and will lead to a pilot CO2 storage trial at a suitable site.

Gas for the trial will be sourced from a demonstration project involving post-combustion capture – a process for chemically removing CO2 from the flue gas of power stations.

Australian Coal Association executive director Mark O’Neill said the coal industry was “firmly committed to working with Government, the power generation industry and the research community to make major cuts in greenhouse gas emissions from the power sector in NSW”

“Achieving that objective will depend on further development of a suite of promising new technologies for coal including carbon capture and storage,” O’Neill said.

The NSW coal industry directly employs 13,000 people and more than 54,000 indirectly.