The Coalition has revealed further details of its plan to build nuclear reactors in Australia, claiming it could deliver an electricity system costing $263bn less than the Albanese government’s plans to power Australia on renewables backed by storage and gas.
The Coalition is relying on Frontier Economics modelling to argue its nuclear vision for seven reactors across the country would be 44% cheaper than the government’s renewables-led plan.
So what do we need to know about the Coalition’s proposal?
Does the plan address the climate crisis?
Not for about 25 years. Frontier’s modelling shows the amount of CO2 released for every megawatt hour of electricity generated under the Coalition’s nuclear plan.
The report shows the “emissions intensity” of electricity stays much higher with nuclear than without until sometime between 2046 and 2049 – after which electricity would be slightly cleaner.
This is mostly because, under the Coalition, the modelling shows more coal stays in the grid for longer, releasing more CO2.
Any delays in rolling out nuclear reactors, which experts say is very likely, would lead to higher emissions for longer.
The Coalition’s chosen scenario to develop the electricity grid is in line with a 2.6C rise in global temperatures by the end of the century.
Is the Coalition’s plan comparable to the government’s?
No. The Coalition says its plan delivers an electricity system that costs 44% less than the government’s proposal – a saving of $263bn.
But the detail in the Frontier Economics report shows this 44% cost reduction comes as a result of comparing two different scenarios for the future of the electricity grid.
The Australian Energy Market Operator (Aemo) looks at three scenarios for the electricity grid and Frontier based its modelling on two of them – called “progressive change” and “step change”. The Albanese government prefers step change.
Frontier says the “progressive” scenario is preferred by the Coalition and adding nuclear to this “is 44% cheaper than the step change future as envisaged by the federal Labor government”.
The problem here is obvious. We are not comparing apples with apples.
Tristan Edis, director of Green Energy markets, says the “progressive change” scenario “involves total electricity consumption in 2052 of 311TWh, whereas step change is 450TWh or almost 45% greater electricity demand”.
So the Coalition’s plan to deliver nuclear is based on a scenario where Labor’s preferred plan is producing 45% more electricity than the Coalition’s.
Clearly, a system producing more power will cost more. Dr Dylan McConnell, an energy systems expert at UNSW, says without adding nuclear, Aemo’s “progressive change” costs are about $133bn less than for “step change”.
The “progressive change” scenario being promoted by the Coalition assumes much slower roll-outs of electric vehicles, rooftop solar and the electrification of homes and businesses.
That suggests consumers would miss out on any cost savings from running electric vehicles or using less gas in their homes for cooking and heating (as well as the cuts in emissions that come with using less fossil fuels).
How realistic is the Coalition’s timeline for building reactors?
Frontier Economic’s report suggests the first nuclear power would enter the grid in 2036 – but many experts say this is wildly optimistic.
The CSIRO estimates it would take at least 15 years for Australia to establish the necessary legal and regulatory functions and then finance, commission and build a working reactor.
Energy expert Simon Holmes à Court laid out his own timeline this week saying there was “not a hope in hell” a nuclear reactor could be working before 2040. He said his own optimistic scenario put the date at 2044.
What other roadblocks does Peter Dutton face?
Dutton said because the Coalition was in opposition it hadn’t been able to begin the negotiations needed to make nuclear a reality in Australia.
Before a single nuclear energy plant could be built, the Coalition would have to win the next federal election.
Then, a Dutton-led government would have to overturn a Howard-era national ban on nuclear energy – with laws passing both Houses of Parliament. If Dutton winning a majority in the lower house seems a tough ask, getting such a plan through a likely hostile Senate would be even harder.
Then, the Coalition would have to see various state governments overturn their bans on nuclear energy. Finally, state leaders would need to be onboard to support reactors being built in their back yards.
As Guardian Australia has reported, Labor governments and Coalition oppositions in New South Wales, Victoria, Queensland and South Australia are either outright opposed to the plan or have failed to endorse it. The new Queensland Liberal premier, David Crisafulli, ruled out nuclear during that state’s recent election campaign.
Dutton has pointed to constitutional powers to override state objections if necessary. He has also noted the openness of SA’s Labor premier, Peter Malinauskas, to nuclear.
How much will electricity cost under the Coalition’s nuclear plan?
Dutton claimed the nuclear option would mean “a 44% saving for taxpayers and businesses” but does that translate into cheaper power prices?
Frontier’s report says it does not “present any results for the prices [of wholesale electricity] as this will depend on how the cost of new capacity will be treated in the future”.
In other words, they don’t know what the cost of power will be.
How have critics responded?
The climate change and energy minister, Chris Bowen, criticised the Coalition for not detailing how the nuclear plan would affect consumer power bills and pointed to other modelling showing it could push up bills by $1,200 a year.
He claimed the Frontier report contained “fundamental errors” and “heroic assumptions”, pointing out it assumed Australia would consume less power than Aemo’s modelling forecast. Bowen also criticised the report for using cheaper prices to produce nuclear power than the CSIRO and AEMO accounted for.
The federal Greens leader, Adam Bandt, called it a “con job for coal”, noting the nuclear strategy relied on extending the life of fossil fuels.
The Australian Chamber of Commerce And Industry said the plan needed to be scrutinised thoroughly. It wasn’t critical but called for “long-term certainty” for the business community regarding power prices and reliability.
The Clean Energy Council said it would be a “disaster” for power bills and dramatically slow the rollout of renewables like rooftop solar.
Rod Campbell, of the Australia Institute, said the nuclear plan was a “distraction to prolong fossil fuel use and exports”.
