Coalition to release nuclear costings – what we know so far
Adam Morton
We haven’t seen the details, but the opposition has released them to some newspapers. It reports that the opposition will claim its plan will lead to 38% of electricity coming from nuclear energy and 54% from renewable energy by 2050 and cost $263bn less than Labor’s policy to reach net zero emissions by 2050.
We can’t assess the Coalition’s claims without seeing them in detail, but there are a few things worth remembering today:
-
Most independent experts including the CSIRO don’t agree that adding nuclear power could lead to a cheaper grid. They have repeatedly found that solar and wind with firming support from energy storage, new transmission connections and “peaking” gas plants is the cheapest source of electricity.
-
CSIRO’s latest draft Gencost report – its annual assessment of electricity costs – this week found electricity generated from renewable energy with firming support in 2030 would cost at least 50% less than nuclear.
-
Several energy experts told Guardian Australia that international experience suggested the cost of building nuclear power plants could be much higher than the CSIRO has suggested – possibly more than double.
-
The Coalition will defend its policy using analysis by Danny Price, from the consultants Frontier Economics. He has a long history in national energy and climate debates, mostly working with the Coalition.
-
Price reportedly says his modelling shows the “total system cost” of the electricity grid is cheaper with 38% nuclear power and 53% renewable energy than if it runs overwhelmingly on solar and wind plus firming. A first stage of Price’s analysis last month argued the Australian Energy Market Operator had underestimated the cost of running the grid predominantly on renewable energy and storage, largely because the operator had adjusted for inflation, a standard accounting practice.
-
The Coalition and News Corp tabloids have claimed that Price’s work was evidence of a “$500bn green hole” in Labor’s plan. But this is not a widely held view.
Key events
McKenzie questioned on whether nuclear plan will bring power prices down
Nationals senator Bridget McKenzie was also on the program and, much like her colleague Barnaby Joyce a moment ago, did not answer directly whether the Coalition could bring down power bills in the near-term:
Our plan is absolutely cheaper than Labor’s plan to get to 2050 … by adding net zero nuclear to firm up [the] renewables that we’ve got in the grid as well, is the way to actually get prices down over the long-term.
Shorten labels Coalition nuclear plan a ‘fantasy’
NDIS minister Bill Shorten also weighed in on the Coalition’s nuclear plan this morning, while speaking with the Today Show. He told the program just earlier:
I think that the heroic assumptions of Peter Dutton promising some sort of fanciful solution in 25 years time, is just a crock of the proverbial …
Mike Tyson once said that everyone has a plan until they get punched in the mouth. All I can say about Peter Dutton’s plans is wait until I get punched by the facts, and we are going to just examine it …
The idea we’re going to come from scratch and build a whole nuclear industry in Australia is, you know, just a fantasy.
Joyce unable to promise power prices would come down over next term under Coalition government
Nationals MP Barnaby Joyce has been speaking with ABC RN about the Coalition’s nuclear policy costings. He said that amid the announcement there would be “all the hypothesis and all the rhetoric”, but pitched the policy to voters:
Here’s the two points of truth you have to ask yourself. Is my power bill cheap? Am I happy with what is happening? And is every other country on the globe off their head with nuclear power, or are we actually dragging the chain?
Host Patricia Karvelas has asked multiple times if he could promise power prices would go down over the next term under the Coalition? But he will not answer directly, instead criticising Labor’s plan.
Joyce went on to say:
That is asking for a hypothetical question, which I could answer for you, but I would not be telling the truth, because I don’t have the facts before me.
Hundreds of engineers strike at Qantas
Qantas says it has put a number of contingencies in place as hundreds of engineers have walked off the job for 24 hours, amid pay negotiations.
Qantas said it has been notified about work stoppages by some of its aircraft maintenance engineers today and on 20 December. The airline said it expects to have the resources available to cover today’s flights, and that about 160 engineers are rostered on today.
The ABC reports that about 500 engineers across Sydney, Melbourne, Brisbane, Adelaide and Perth airports started walking off the job from 3.30am, local time, and would not return until 7.30am, local time, on Saturday.
Pay negotiations have broken down between Qantas and the unions representing engineers, over their request for a 25% pay rise.
A Qantas spokesperson said “at this time of year our aircraft are full and airports are busy so we urge customers to give themselves more time to get through security and get to their aircraft”.
We’re offering our engineers a competitive package including pay rises, upskilling and career progression that will enable them to earn significantly more over the next few years.
Does Labor regret promising back in 2022 that power prices would fall by $275 a year for Australians by next year?
Chris Bowen said he doesn’t regret “pointing out that renewables are the cheapest form of energy”.
Pushed on the specifics of the question, Bowen cited “a different set of circumstances internationally” that the government is dealing with.
Australia’s increase in energy prices has been less than a lot of other comparable countries. We delivered billions of dollars of energy bill relief which has been the appropriate thing to do, which has been opposed by the Liberal and National party.
Bowen lashes Coalition plan to keep ageing coal-fired power stations open beyond middle of next decade
Under the Coalition’s plan, ageing coal-fired power stations would stay open beyond the middle of the next decade when most of the operators say they’ll have to shut – is that realistic?
Chris Bowen said no, and that this was “terrible news” for Australia’s emissions and the reliability of Australia’s energy grid.
The biggest threat to reliability in our energy system is coal-fired power now. We are dealing with … outages, breakdown, on a daily basis and that is what is the biggest threat to the reliability of our energy system and it’s a recipe for blackouts to keep ageing coal-fired power stations in the grid for longer.
He continued lashing the Coalition policy, arguing it would “not survive contact with reality”.
Bowen rejects renewables price tag from Frontier Economics
Asked if he accepts that $594bn figure arrived at by Frontier Economics for renewables, Chris Bowen responded “no, of course not”.
What they have also done is very clearly in their costings of their own policy rejected the CSIRO and Aemo’s work. Now, CSIRO and Aemo have been talking about the cost of nuclear since way before we were in office as being the most expensive form of energy available.
Fundamentally what the Coalition is asking the Australian people to believe is this: that they can introduce the most expensive form of energy and it will be end up being cheaper. It won’t pass the pub test. It won’t pass the sniff test because it is just a fantasy.
The climate minister said he stood by the $122bn figure for his policy “because it’s the figure in the ISP which is the most detailed roadmap of any energy system in the world”.
Bowen says Coalition would have had to ‘stretch truth’ to arrive at ‘dodgy figures’
Chris Bowen also accused the Coalition of “making it up as they go along” – claiming Aemo has got it right for everything except transmission “and then just doubled the cost of transmission just plucked a figure out of the air”.
And they have implied – which I imagine we’ll see in the costings today – that nuclear needs less transmission which it doesn’t. Spoiler alert: it doesn’t. You still got to get the electricity around the country. I’m not sure how they’ll get the nuclear power into the grid, maybe by carrier pigeon if they’re going to assert if somehow you’ll need less transmission.
They have had to make some very heroic assumptions here, and they have had to really stretch the truth to try to get some very dodgy figures.
Bowen accuses Coalition of ‘mathematical gymnastics’ to made ‘vague’ nuclear costs add up
The climate change and energy minister, Chris Bowen, says that the Coalition would have had to do some “mathematical gymnastics” to make its “vague” nuclear costings add up.
Asked if he accepts the Coalition’s nuclear policy would be $263bn cheaper than Labor’s renewable policy, Bowen said “maybe they’ll throw in the Harbour Bridge and the Sydney Opera House as well with that sort of costing”.
We’ll go through the details today. I don’t believe they have released it to the ABC or the ALP, funnily enough, but clearly they had to do some mathematical gymnastics to make this in any vague way add up. They have even downgraded their costings of renewable energy by around $30bn over the last couple of weeks. If that policy didn’t last pass an election, why would the nuclear costings last any longer?
Adam Morton
Factcheck of Coalition’s case for nuclear
For those who want to know more about the nuclear debate, here is a factcheck we published in June:
Adam Morton
More facts to consider as we learn more of Coalition nuclear costings
Continuing from our earlier post: there are a few other things worth considering as we hear more about the Coalition’s nuclear proposal.
-
It claims nuclear plants could be developed and operational by the mid-2030s, depending on the tech used. Few experts believe this is credible. Why? Only five large-scale nuclear plants have reached construction stage in the US and western Europe this century. Four were spectacularly over time and over budget. The fifth was cancelled after A$13bn had been spent.
-
CSIRO found it would take at least 15 years to develop a nuclear industry and have a generator running in Australia.
-
Experts say this raises questions about grid reliability as the coal plants that the Coalition wants to replace with nuclear are ageing and mostly won’t last that long. It says Peter Dutton’s pledge to slow the roll out of renewable energy and wait for nuclear plants puts the grid at risk. According to reports this morning, Frontier Economics assumes two-thirds of coal plants that the government expects to close by 2034 will still be operating then.
-
Like solar and wind, nuclear energy generation is zero emissions. But burning more coal and gas before it could become available would add significantly to Australia’s greenhouse gas emissions. It means climate pollution would be higher under the Coalition’s plan – and scientists say deep cuts in emissions are needed now. The opposition has voted against all of Labor’s climate policies and has no emissions reduction policies of its own for the next decade.
Good morning
Emily Wind
Emily Wind here, signing on for blogging duties this Friday. I’ll be taking you through our live coverage for most of today.
As always, you can read out with any tips via email: [email protected]. Let’s get started.
Coalition’s nuclear costings contain some big unknowns
Peter Hannam
We’ve asked Danny Price and Frontier Economics (which he co-founded and of which he is managing director) for a copy of the report he has compiled for the Coalition on its nuclear plans.
From what’s reported in the media given excerpts from Price’s report, we find a few puzzling results. As we reported here last month, Price’s part 1 of two reports was intended to set a “base case” for the second component.
For unexplained reasons (so far), that base shifted to the tune $48bn in a couple of weeks, at least as far as Price’s estimate of what Labor’s net zero plans for the grid entail. Price claimed the latter – based on the Australian Energy Market Operator’s most likely “step change” scenario – would cost $642bn but that number drops to $594bn in the second report, according to details in the Daily Telegraph. That’s not so far off Aemo’s “real cost” estimate of $580bn, or so Price stated in his “base case” part 1 report.
(The $122bn Aemo tally was based on standard accounting methods to assess the “net present value” of future spending, a requirement imposed on Aemo by former Coalition energy minister Angus Taylor, the government revealed this week.)
According to the version in the Daily Telegraph, only one-third of the remaining coal-fired generators will close by 2034, compared with 90% in Aemo’s “step change” scenario by then. The extension of already unreliable power plants would include additional fuel and maintenance costs, not to mention additional carbon pollution from the relatively emission intensive energy source.
Media outlets, including the Australian Financial Review, which have been giving snippets of the Frontier Economics report, report overall electricity use will be lower by 2050 than Aemo estimates. One reason is that there will be less electrification of transport than Aemo forecasts but that presumably brings with it an additional fuel cost – not yet made public by Frontier – and additional carbon emissions that will count against a net zero achievement by 2050.
Outlets given access to the extracts say nuclear is assumed to be “always on” and operating “around the clock”. This assessment compares with the 53%-89% range assumed by CSIRO in its latest GenCost report, based on operations of the present coal fleet average over 2011-21. In recent decades, the average capacity use globally has been in the 80% range, with 10% of reactors operating at a capacity factor of 60% or less. To run nuclear plants at full capacity – an unlikely assumption given maintenance needs, for starters – would also mean curtailing (block) output for renewable energy generators, undermining their costs and investment appeal to owners and their financial backers.
No doubt there will be other assumptions carrying big question marks if/when we see the modelling Price plugged in.
Coalition to release nuclear costings – what we know so far
Adam Morton
We haven’t seen the details, but the opposition has released them to some newspapers. It reports that the opposition will claim its plan will lead to 38% of electricity coming from nuclear energy and 54% from renewable energy by 2050 and cost $263bn less than Labor’s policy to reach net zero emissions by 2050.
We can’t assess the Coalition’s claims without seeing them in detail, but there are a few things worth remembering today:
-
Most independent experts including the CSIRO don’t agree that adding nuclear power could lead to a cheaper grid. They have repeatedly found that solar and wind with firming support from energy storage, new transmission connections and “peaking” gas plants is the cheapest source of electricity.
-
CSIRO’s latest draft Gencost report – its annual assessment of electricity costs – this week found electricity generated from renewable energy with firming support in 2030 would cost at least 50% less than nuclear.
-
Several energy experts told Guardian Australia that international experience suggested the cost of building nuclear power plants could be much higher than the CSIRO has suggested – possibly more than double.
-
The Coalition will defend its policy using analysis by Danny Price, from the consultants Frontier Economics. He has a long history in national energy and climate debates, mostly working with the Coalition.
-
Price reportedly says his modelling shows the “total system cost” of the electricity grid is cheaper with 38% nuclear power and 53% renewable energy than if it runs overwhelmingly on solar and wind plus firming. A first stage of Price’s analysis last month argued the Australian Energy Market Operator had underestimated the cost of running the grid predominantly on renewable energy and storage, largely because the operator had adjusted for inflation, a standard accounting practice.
-
The Coalition and News Corp tabloids have claimed that Price’s work was evidence of a “$500bn green hole” in Labor’s plan. But this is not a widely held view.
Good morning and welcome to our live news blog. We’ll start today with what we know about the Coalition’s nuclear costings, based on the detail that has been reported, and bring you all the news around Australia as it happens.
