‘Cheaper, cleaner, more consistent’: Do Dutton’s claims on nuclear stack up?

Australia’s climate wars have gone nuclear as Opposition Leader Peter Dutton brands the Albanese government’s plan to ramp up renewables as expensive and risky to power supply.

On Wednesday, Dutton released his plan to build seven nuclear reactors across the country on the sites of old coal-fired power stations. His six-page policy manifesto promises a “bold, visionary” nuclear program that will provide cheaper, cleaner and more consistent energy, while lowering prices for families and businesses.

Here is a fact check of the opposition’s key claims.

Peter Dutton wants nuclear power for Australia.Credit: John Shakespeare

Will it be cheaper?

Dutton said his plan was cheaper and would lower household power prices. But he will not release the costings until a later date, which means it’s not possible to examine its commercial viability.

Experts have already questioned whether nuclear energy can deliver cheaper power. The Coalition has mounted an argument against renewables by saying that the cost of new transmission lines, which link wind and solar farms into the grid, is not included when the cost of renewable power is compared with other forms of generation.

The CSIRO’s GenCost report on electricity generation renewables, which factors in $40 billion in transmission lines and batteries, says they deliver cheaper power than nuclear energy.

The CSIRO found the cheapest electricity would come from a grid that draws 90 per cent of its power from renewables, which would supply electricity for a cost of between $89 and $128 per megawatt hour by 2030.

They calculated that a large-scale nuclear reactor would supply power for $136 to $226 per megawatt hour by 2040. Small modular reactors are even more expensive – between $171 and $366 per megawatt hour by 2040.

Internationally recognised financial services firm Lazard also found renewable energy sources continued to be much cheaper than nuclear. It said onshore wind was the cheapest, with a cost of between $US25 and $US73 per megawatt hour. The second cheapest was utility-sized solar at between $US29 and $US92. Nuclear was the most expensive, at between $US145 and $US222.

How long does it take to build a nuclear reactor?

Dutton has promised to build two reactors before 2037. He said small modular reactors, which are not yet in commercial production, could be completed by 2035, while traditional large-scale reactors could be in operation by 2037.

Most experts say this timeline is too ambitious and it would take far longer. This is because of challenges such as establishing a safety regime, importing a skilled workforce to build the plants, and preventing any cost blowouts.

New legislation would also be required to legalise the industry, after the Howard government banned nuclear energy generation in 1998.

Former chief scientist Alan Finkel, who was a special adviser to the federal government on low-emissions technology, has forecast longer construction times than those envisaged by the opposition. He said it would take at least 20 years for a large-scale or small modular reactor to start generating electricity for the grid.

However, Professor Andrew Stuchbery, head of physics at the Australian National University, said both China and the United Arab Emirates had built nuclear plants within a decade.

“China do it all the time … The UAE is an interesting example because they started absolutely from scratch, and they built them [reactors] in a bit under 10 years,” Stuchbery said. “If you look at some of the reactor projects in Europe and the US, they have been subject to delays, and the reason for that is that they had lost supply lines, they had lost the expertise in the country.”

The World Nuclear Association says the current global median build time for a nuclear plant is about nine years.

Can the Coalition keep a lid on cost blowouts?

Experts warn the potential for cost blowouts is a major risk for the opposition’s nuclear plan.

Dutton said an opposition government would build nuclear plants with a Commonwealth-owned corporation, such as Snowy Hydro. The Snowy 2.0 pumped hydro project has blown out from an initial cost of $2 billion to $12 billion, while the construction deadline has been extended by seven years, to 2028.

The UK’s flagship nuclear project, Hinkley C, has been beset by delays and cost blowouts. In 2017, the French-owned contractor EdF said it would be completed within a decade for $15 billion. But construction delays and technical problems have pushed out the estimated price to more than $90 billion, and the start date to about 2031.

The United States’ most recent nuclear power project, at the Vogtle Electric Generating Plant in Georgia, sought to double the plant’s capacity with two more reactors. Design began in 2005 and it was initially costed at $US13 billion, with a 2023 completion date. While the first reactor came online last year, it cost $US34 billion.

The UAE had more success with timing. It awarded a contract to South Korean company KEPCO in 2009 to build four nuclear reactors, estimated to be worth up to $US30 billion. Construction of the first reactor began in 2012 and was completed in 2020, with the other three also taking less than nine years to complete.

Does a green grid need nuclear?

The Coalition’s policy manifesto says shifting to nuclear “will keep an always-on source of 24/7 baseload power in the system to drive prices down and keep the lights on while we decarbonise”.

The energy market is made up of retailers, who buy electricity supply in short blocks around the clock, and generators, who supply the power. These generators compete on price and the cheapest always wins.

Renewables currently supply about 40 per cent of the grid’s electricity, and the Albanese government is aiming to have renewables supply 82 per cent of the grid by 2030.

The Australian Energy Market Operator (AEMO), which manages the day-to-day operations of the energy grid, has forecast that more than 80 per cent of coal power will shut down by 2032, and all of it will be gone by 2038.

The advocates for both nuclear and coal power argue that continuous electricity generation, also known as baseload power, is needed for stable, secure energy supply. They argue renewables are subject to events such as wind and solar droughts, while nuclear plants are designed to run around the clock.

The flipside is that nuclear plants cannot be turned off at short notice and could spend a lot of time operating at a loss. That’s because the large amount of solar power in Australia can often drop daytime wholesale power prices to $0.

The Albanese government cites the AEMO, which says the grid does not need a new source of baseload power.

The operator has said wind and solar, paired with batteries and pumped hydro dams, will be able to supply up to 90 per cent of our power needs in the future, while rapid-response gas or hydrogen-fired generation plants could be used in short bursts when needed.

Can the Coalition build reactors if nuclear energy is banned?

Dutton’s nuclear ambitions have already started a fight with state governments and raised questions about how a federal Coalition government would gain access to the sites of old coal plants to build nuclear reactors.

Dutton said he would create a Commonwealth-owned corporation, which could apply a national interest test and compulsorily acquire land or reactor sites. But he would still need state approval for project development. As well as overturning legislated bans on nuclear energy at the federal level, he will need to overcome state laws in NSW, Victoria and Queensland.

In NSW, Premier Chris Minns said he would not remove the state’s nuclear ban, but the Coalition opposition said they were open to it. Victorian Premier Jacinta Allan is opposed to nuclear energy, and Opposition Leader John Pesutto said his party had no plans to introduce it.

In Western Australia, Premier Roger Cook has said “no one in Collie wants to see nuclear power established or constructed in their community”, while South Australian Premier Peter Malinauskas said nuclear energy would make electricity more expensive. In Queensland, Labor Premier Steven Miles and the state’s Liberal National Party leader, David Crisafulli, have both rejected Dutton’s nuclear plans.

Dutton said the assets would be owned by the federal government, which would form partnerships with experienced nuclear companies tasked with building and operating them. The owners of some of the coal plant sites targeted for nuclear development in NSW and Victoria – including AGL, Origin, EnergyAustralia and Alinta – have previously said they have no plans to develop nuclear energy in Australia.

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