Dutton lights up election contest with nuclear power

Peter Dutton has taken a high-stakes pre-election gamble with a radical nuclear option involving government ownership and a federal takeover of traditional state responsibilities. By favouring corporatisation and state intervention, the Opposition Leader is trampling on core conservative values. But he is betting the electorate will reward strong leadership in an area where doubts about the Albanese government’s competence are growing, as the Coalition works hard to make energy policy a proxy for a cost-of-living crisis that is proving difficult to tame.

In political terms it represents a slugfest over ideological opinion that is quite divorced from the merits of what is on the table. At The Australian’s Energy Nation Forum on Wednesday, Jim Chalmers called the opposition nuclear policy the “dumbest policy ever put forward by a major political party” and accused the Coalition of “ideological stupidity”. Climate Change and Energy Minister Chris Bowen called it a “furphy” and a “risky nuclear scam”.

Mr Dutton has positioned himself as an energy outsider on the side of taxpayers and energy users and not “rich green millionaires”. “We are going to the next election seeking a mandate from the Australian people, a very clear mandate that we want support to modernise our energy system … which is about economic growth and jobs for decades and generations to come,” Mr Dutton said.

In engineering terms, the Coalition is presenting a conservative case of swapping out ageing coal-fired generation with a like-for-like baseload replacement in nuclear. The federal opposition has identified seven sites, primarily Nationals-held seats, where nuclear plants could replace coal-fired power stations and use existing transmission infrastructure. The sites are spread across the nation: two in NSW, two in Queensland, and one in each of Victoria, South Australia and Western Australia.

Most state leaders were quick to line up in opposition to the plan. South Australian leader Peter Malinauskas has previously spoken out against the faux ideological war over nuclear and for it to be considered on its merits. It is instructive to consider that South Australia faces the biggest challenge bridging the gap of intermittency with renewables. Aside from opposition from state leaders there are myriad obstacles including uncertain cost, timing, technological maturity, social licence and the prospect of protracted green obstruction and potential lawfare. But none of this is to suggest it is not a journey worth taking.

As key leaders at The Australian’s Energy Nation Forum made clear, all options should be on the table. Origin Energy chief executive Frank Calabria said from his position we needed to keep an open mind about technologies and he was happy for all to be in the debate. “Then we make the best choices,” he said. As things stand, the best available option still is gas. There is a hope that better grid management and the development of affordable and scalable hydrogen will provide a future backup for intermittent renewables, but neither is yet a reality. The assessment of Origin is that there will be times when backup sources of energy will have to run for 20 hours or several days. In South Australia there will be years with events for many days, and Mr Calabria says nuclear is an alternative to provide baseload emissions-free energy “at a future time and cost that is not yet certain but it is a debate”.

Mr Dutton does not expect the debate to be civil. But it is a legitimate public policy question that goes to the heart of the nation’s economic and energy future. Existing policy is based on providing guarantees and subsidies that socialise the losses in the energy transition. As costs rise, the community resistance to the rollout of the big generation and distribution assets that are needed is growing as well. Government has yet to demonstrate that it can manage the complex arrangements required to keep the lights on at an affordable price.

Mr Dutton has provided an alternative pathway that infuriates established insiders. It will make investment decisions for currently favoured renewable projects more difficult. But it is a debate that is long overdue. The first step is to remove the legislative obstacles at both the state and federal levels to the development of nuclear technologies and to develop the skills base that will be needed if, as a nation, we come to the same conclusion as others who are dealing with the difficult task of decarbonisation and make nuclear a part of the energy mix.