Nuclear power plant costs need sharp fall to help Australia reach net zero target, a study finds

The cost of building nuclear power plants must fall significantly for the energy source to be a part of Australia’s decarbonisation strategy, says the final report of Net Zero Australia.

Offshore wind farms will play an increasing role in Australia’s energy generation from 2030, according to Net Zero Australia. Picture: AFP

The price of building nuclear power plants would need to fall dramatically for it to find a place in Australia’s decarbonisation strategy, and carbon capture will need to play a major role in the nation’s net-zero economy alongside a staggering increase in the rate of renewable energy generation.

Those are among the findings of final modelling in a major expert study of Australia’s path to net zero carbon emissions, conducted by interdisciplinary teams from the University of Melbourne, The University of Queensland, Princeton University’s Andlinger Centre for Energy and Environment, and Nous Group.

The expert group, Net Zero Australia, will release its final modelling on Wednesday, saying the country needs to triple the capacity of the National Electricity Market by the end of the decade to be on track to reach the commitment of being net zero by 2050.

Net Zero Australia released its interim modelling in August last year, after a multi-year effort to model Australia’s possible paths to a near-zero carbon economy, which suggested the country will require wind and solar capacity worth 40 times the capacity of the current NEM to achieve the goal.

Robin Batterham, emeritus professor of engineering at the University of Melbourne – and Australia’s former chief scientist – chaired the steering committee and told The Australian the new figures incorporated the potential use of nuclear power, as well as forecast changes in the cost of installing wind and power generation, to reach its new conclusions.

A nuclear power plant in France. Picture: GUILLAUME SOUVANT / AFP

Among those are the conclusion that nuclear power will have little or no role to play unless costs of building and operating plants fall by at least 30 per cent from current “international best practice”, and the build out of renewable energy generation is significantly constrained – by any one of a range of factors, including policy settings, supply chain issues, or simply the time taken to win environmental and other permits.

“Even if you took the lowest costs that are currently being built in the world now, which is the ­Korean (reactors) in the Middle East, and then knock 30 per cent off them, nuclear only just gets a look in if you really constrain the renewables build,” he said.

The South Korean-led construction of the Barakah nuclear power plant in Abu Dhabi built four reactors, collectively with a nameplate generation capacity of about 5400MW. Initially tipped to cost $US20bn ($30bn) and be fully operational by 2020, its full cost is now estimated at about $US24bn – and the plant did not have its first unit supplying power until 2021.

Professor Batterham said the updated modelling – intended to be updated on an ongoing basis – also factored in substantial cost inflation in the Pilbara and other parts of northern Australia, downgrading the likely size of solar energy installations, and increasing the proportion of energy expected to be generated by offshore wind farms, particularly in the nation’s southern waters.

Emeritus professor Robin Batterham. Picture: Daniel Burdon

“This is quite a message to the states because it says you don’t have to change the numbers much to shift the opportunities around quite a bit,” he said.

But the size of the task in front of the country is still staggering, according to Net Zero Australia’s modelling.

Australian projects will need to attract up $7 trillion-$9 trillion worth of investment to decarbonise the nation’s own electricity market and replace existing export products, and grow renewable ­energy generation by about 40 times the current NEM generation capacity.

Under the most aggressive renewable energy scenario modelled by Net Zero Australia, the country’s total domestic energy costs would fall from just under 9 per cent of GDP to about 7 per cent by 2050.

And the skilled workforce needed to install and run new generation assets, transmission lines, and associated decarbonisation ­efforts will need to double to at least 200,000 people by 2030 and reach 700,000-850,000 – most with technical skills – by 2060.

But Professor Batterham told The Australian companies and governments also needed to factor in a dramatic increase in the use of carbon capture utilisation and storage (CCUS) to have any hope of reaching a net zero economy.

“CCUS appears in all of the scenarios and a lot of people will be uncomfortable with that,” he said.

“Essentially, no matter what you do, you’ve still got a hard-to-abate emissions sector in this country – aviation and cement and chemicals. And you’ve got to put a bit of carbon away to make up for those.”

Professor Batterham said the group’s modelling had found that even the most optimistic projections of the capacity of revegetation efforts, and other initiatives in Australia’s farming and land sector, still left the need for carbon capture projects using existing technologies – such as pumping carbon emissions into disused oil and gas reservoirs.

“Our estimate is that, if you ­really want to, you can probably get to 100-plus million tonnes a year. Even though at the moment we’re well below that,” he said.

“But in a constrained renewables scenario, and to decarbonise all of our exports, then you would need a monumental amount of CCUS.”

Professor Batterham said the new modelling also backed the need for an increase in gas-fired generation – albeit from plants that would run far more intermittently than they did now.

“Whether that gas is hydrogen, synthetic natural gas – or just natural gas, and we put in a pile of direct air capture to offset it – the capacity needed is even more than we currently have. But their utilisation is woeful, in the 5 per cent range,” he said.

“But we can’t see battery prices, or the amount of pumped hydro you could put in, coming down to the level where you can’t get away without some gas for back-up.”