The funds represent the proportion of the coal industry's national $1 billion COAL21 Fund expected to be raised through coal production in NSW.

Announcing the commitment with Premier Morris Iemma, NSW Minerals Council CEO Dr Nikki Williams and Australian Coal Association executive director Mark O’Neill both said the funding would help make the state a leader in the development of low emissions technologies needed to meet the twin objectives of energy security and cutting greenhouse gas emissions.

The industry has already announced funding of $20 million to support the NSW Government’s $60 million carbon capture and storage project, which will lead to a pilot carbon dioxide (CO2) storage trial at a suitable site.

Gas for the trial will be sourced from a demonstration project involving post-combustion capture (PCC), a process for chemically removing CO2 from the flue gas of power stations. Results from work already underway in some areas of the state indicate significant storage potential.

“The NSW program is an important step towards achieving the equally important goals of reining in greenhouse gas emissions while at the same time maintaining a robust economy for the people of NSW,” Williams said.

The black coal industry is the state’s largest export earner, underpinning the reliability, affordability and security of the state’s power supply and supports 67,000 jobs (more than 13,000 directly and more than 54,000 indirectly).