The environmental and social costs of the mainland's reliance on coal as an energy source have been grossly underestimated, a joint study by environmentalists and economists says. For each tonne of coal consumed last year, it paid 150 yuan (HK$170) extra in environmental damage, according to 'The True Cost of Coal' report, commissioned by Greenpeace, the US-based Energy Foundation and WWF, and written by prominent mainland economists. It estimates the true cost of coal on the mainland last year was about 1.75 trillion yuan, nearly 7.1 per cent of gross domestic product that year. The figure would be even higher if the impact of climate change were included, according to the report. 'Environmental and social damages are underestimated for using coal in China, as a result of market failures and weakness in government regulations,' said Mao Yushi , lead author of the report and founder of the Unirule Institute of Economics. 'China must count these external costs and make the coal price reflect its true costs.' The so-called external costs were air and water pollution, ecological degradation, increasing health costs, mining accidents and infrastructure damage. It also took into account the price distortion caused by government regulations, such as land-ownership policies and poor worker safety and compensation systems, which keep the cost of coal down. Coal accounts for 70 per cent of the mainland's primary energy consumption and is the biggest single source of air pollution across the country. It causes 85 per cent of sulfur dioxide emissions, 67 per cent of nitrogen oxide emissions and 70 per cent of airborne particles, and has made the mainland the world's biggest greenhouse gas emitter. Mining has contaminated water, degraded land and caused massive land subsidence. Quoting the report, Yang Fuqiang , chief representative of the mainland office of the Energy Foundation, urged Beijing to impose energy and environmental taxes.