Researchers at La Trobe University have developed a process that converts Victorian brown coal (lignite) into carbon fibre, potentially creating a high-value use for coal deposits that are increasingly uneconomic for electricity generation.

Carbon fibre is a high-strength, lightweight material used in aerospace, automotive, and sporting goods applications. It typically sells for $15-30 per kilogram, thousands of times more valuable than coal used for electricity generation.

Professor Robin Batterham, who leads the research, said converting coal to carbon fibre changes the economics fundamentally. “We’re not burning the coal and releasing CO2. We’re converting it to a structural material where the carbon is locked up permanently. That’s a much better use for coal in a carbon-constrained world.”

The process involves extracting pitch from lignite, purifying it, spinning it into fibres, and then heating those fibres in controlled atmospheres to drive off non-carbon elements and align carbon atoms into the crystalline structures that give carbon fibre its strength.

Victorian lignite has characteristics that make it suitable for this process. It contains high concentrations of aromatic compounds that can be extracted and converted to carbon fibre precursor materials. And it’s cheap and abundant, with reserves exceeding 100 billion tonnes in the Latrobe Valley.

Most commercial carbon fibre is made from polyacrylonitrile (PAN), derived from petroleum. PAN-based carbon fibre production is energy-intensive and generates substantial emissions. Pitch-based carbon fibre from coal potentially offers lower cost and environmental footprint.

But pitch-based carbon fibre has historically had quality issues. The mechanical properties are often lower than PAN-based fibres, limiting applications to less demanding uses. The La Trobe process aims to overcome those limitations through careful control of fibre microstructure.

Laboratory tests show the coal-derived fibres achieve tensile strengths of 3.5-4 gigapascals, comparable to mid-grade commercial carbon fibres. That’s suitable for many industrial applications, though aerospace applications typically require 5-6 GPa strength.

The team is working on improving strength through process optimisation and post-treatment methods. Even if coal-derived fibres remain lower strength than premium carbon fibres, the cost advantage could enable new applications where carbon fibre was previously too expensive.

The global carbon fibre market is roughly 120,000 tonnes annually, valued at over $3 billion. Demand is growing about 10% per year driven by automotive lightweighting and wind turbine blade applications. Additional low-cost supply could accelerate adoption in price-sensitive markets.

If Victoria could capture even 5% of global carbon fibre markets, that would represent $150 million annually in revenue, small compared to historical coal industry revenues but significant for regional development. And it would use only tiny fractions of available coal reserves.

The process generates some CO2 emissions from heating and chemical conversion, but substantially less than burning coal for electricity. Life cycle analysis suggests coal-to-carbon-fibre produces about 20% of emissions per tonne of coal compared to combustion.

Some environmental groups remain skeptical about any use of coal, arguing it provides justification for continued coal mining when the focus should be on renewable energy. Others acknowledge that non-combustion uses of coal are much better environmentally than burning it.

The La Trobe research has attracted interest from several Australian manufacturing companies exploring whether domestic carbon fibre production could be commercially viable. Australia currently imports all carbon fibre used domestically, mostly from Japan and the United States.

Building an Australian carbon fibre industry faces challenges beyond just production technology. Carbon fibre manufacturing requires substantial capital investment, specialised equipment, and skilled workers. And it would compete with established international producers that have scale advantages.

One possibility is focusing on specialty carbon fibres for niche applications rather than competing in commodity markets. Australia’s research strength might enable development of fibres with unique properties that command premium prices.

The research received $3.2 million in funding from the Victorian government’s Latrobe Valley transition fund, which supports economic diversification as coal power stations close. The fund recognises that coal-dependent communities need new industries to replace lost mining and power generation jobs.

Carbon fibre production is unlikely to employ as many people as coal mining and power generation did at their peak, but it could provide some high-skill manufacturing jobs in the region. Combined with other diversification initiatives, it contributes to transition strategies.

La Trobe University is building a pilot plant that will produce about 100 kilograms of carbon fibre weekly for testing and product development. The plant will operate from late 2025, producing samples that potential customers can evaluate.

Whether carbon fibre from coal achieves commercial viability depends partly on carbon fibre prices, which fluctuate with supply-demand dynamics and petroleum feedstock costs. Currently strong demand and tight supply have pushed prices up, improving economics for alternative production methods.

The technology could also apply to other coal deposits globally. Many countries have lignite or sub-bituminous coal reserves that are becoming uneconomic for power generation but could potentially be used for materials production.

China produces some pitch-based carbon fibre from coal but hasn’t achieved the quality levels that the La Trobe process targets. If Australian technology can produce higher-quality fibres, it might be exportable to other coal-producing regions.

One technical challenge is ensuring consistent quality. Coal composition varies between seams and even within seams, potentially affecting fibre properties. The process needs to accommodate that variability or use coal selection and blending to maintain consistency.

The pilot plant operations will address these questions and determine whether commercial-scale production is technically and economically feasible. Results are expected by mid-2026, informing decisions about potential commercial investment.

Whether coal-to-carbon-fibre becomes a significant industry for the Latrobe Valley remains uncertain. But it represents innovative thinking about how coal assets might be repurposed for a low-carbon economy rather than simply abandoned as stranded assets.