Millions fewer Australians to drive electric cars or have rooftop solar under Dutton’s vision

Opposition Leader Peter Dutton’s nuclear energy policy relies on millions of Australians not installing rooftop solar panels or driving electric vehicles, spurring opposition backbenchers to demand answers on how the plan reduces energy bills in the short term.

The Coalition’s modelling assumes Australia will use 40 per cent less electricity than the government plans to by 2050, opening the opposition to criticism from Labor and the Climate Change Authority that its policy could crimp economic growth.

Opposition Leader Peter Dutton insists the Coalition’s nuclear plan will save Australians money despite the CSIRO’s calculations. Credit: Monique Westemann

Modelling commissioned by the Coalition and completed by Frontier Economics claims Dutton’s plan will cost $331 billion by 2050, 44 per cent less than the consultancy believes Labor’s would cost, based on much cheaper nuclear plant prices than many countries have faced overseas.

But the Coalition’s leadership has not unveiled plans for short-term power bill relief, raising questions from its MPs in an internal briefing before an election where all sides agree voters are suffering from cost-of-living pressure.

The opposition’s plan to build seven nuclear plants would leave less room in the electricity grid for renewable energy, including rooftop solar panels. It has committed to build 13 gigawatts of nuclear power, which it said would supply 38 per cent of the grid’s electricity by 2050.

“Under the opposition’s preferred scenario far fewer households benefit from rooftop solar and batteries reducing their bills,” said Tristan Edis, director of investor advisory firm Green Energy Markets.

The opposition has said it would construct nuclear plants on the sites of existing coal power plants, arguing this will cut $18 billion from the construction bill by limiting the renewables rollout and transmission lines needed to link them to cities.

“The Coalition’s energy plan will save Australians up to $263 billion compared to Labor’s renewables-only approach,” Dutton said in a statement unveiling his signature energy policy on Friday.

To implement its plan, the opposition would need to convince federal parliament to overturn the national ban on nuclear energy enacted under the Howard government, and persuade state government to do the same.

The Coalition’s plan also hinges on running coal plants for potentially decades longer than forecast by the Australian Energy Grid Operator (AEMO), capping the rollout of renewables at just over half of energy supply and building the first nuclear plant by 2037 – 50 per cent more quickly than the CSIRO said is possible.

Frontier’s modelling assumes energy demand will be 40 per cent lower in 2050 than is forecast by AEMO.

A key reason the grid is smaller in the opposition’s forecast is its assumption that just 63 per cent of Australians will drive an EV by 2050, with 37 per cent still driving traditional cars. The government is planning for 97 per cent EV ownership by 2050. About 1 per cent of all cars on the road today are electric, but sales are growing.

Solar panel installations would also be lower under the Coalition plan. For the past three years, households have been installing panels rapidly, but under the opposition, this would more than halve, resulting in several million homes being squeezed out.

When asked by reporters how much the Coalition would reduce power bills by in coming years, opposition energy spokesperson Ted O’Brien conceded Frontier’s modelling did not include an analysis of electricity bills, but argued a cheaper grid would flow through to smaller bills.

“I think it’s fair and reasonable that over time, prices reflect cost,” O’Brien said. “Will the Coalition be delivering cheaper power prices? Yes, they will.”

In a short briefing with Coalition MPs after the press conference, O’Brien faced two questions about what MPs should tell voters about the policy’s effect on near-term energy prices, according to several sources on the call who spoke on condition of anonymity.

Several MPs were dissatisfied with his reiteration that power prices would reflect the cost of the energy grid.

One MP said a forecast on bill prices was “the only thing that mattered” in terms of selling the policy. Labor went to the last election promising a $275 drop in power bills by 2025, but consumers have instead faced rising prices due in part to global inflation and the war in Ukraine.

Confusion over daylight savings time led to dozens of Coalition MPs logging onto the briefing an hour before it was scheduled, furthering the frustration of a group of MPs who believed they deserved to be briefed on the plan before Dutton made it public.

One MP, who declined to be named in order to speak frankly, said it was lucky that Dutton had strong internal authority because the process was “insulting”.

Energy Minister Chris Bowen said the opposition had opted to build a smaller, cheaper grid that delivered less economic growth to the nation.

“We believe in economic growth. We believe in giving Australians the options of using more electricity, not less,” Bowen said. “We need to be planning an energy system for the future, one that has data centres and artificial intelligence.

“The experts have already done that work and have said [nuclear] could increase bills by $1200.”

Bowen was referencing a report by the Institute for Energy Economics and Financial Analysis, that found average power bills would rise between $665 and $1200 a year to fund the typical construction costs from reactors recently built in other nations.

Climate Change Authority chair Matt Kean, a former NSW Liberal treasurer, said his agency would model the consequences of the Coalition’s plan.

Opposition Leader Peter Dutton with Coalition energy spokesman Ted O’Brien, left, and Nationals Leader David Littleproud, right.Credit: Glenn Hunt

“That will include a deeper look at what appears at first blush to be the assumption that electricity usage will be minimised, which is indicative of a contracted economy and suppressed economic conditions,” Kean said.

The government’s ambitious renewable energy rollout, which hinges on boosting renewables to 82 per cent of the grid by 2030 and reaching more than 90 per cent by 2050, includes rapid growth in rooftop solar and nearly universal uptake of electric vehicles.

Dutton’s plan would use taxpayers’ money to fund the construction costs of nuclear plants, while the government’s plan relies on private investment to be repaid by electricity customers via their bills.

O’Brien said the government was over-investing in renewables and more fossil fuels were needed in the grid, until zero-emission nuclear was ready to take over.

“That means we need to pour more gas into the system. We shouldn’t be closing our baseload power stations prematurely as we continue to roll out renewables. As coal retires from the system, it should be replaced with zero emissions nuclear energy,” he said.

Coal plant extensions are baked into the opposition’s plan because it will cap renewable energy at 53 per cent of the grid, which is the amount of clean energy expected to be built by as soon as 2026, and the fossil fuel must run until the mid-2040s when nuclear plants are expected to be completed.

But the Australian Energy Council, representing coal plant owners including AGL, Origin and EnergyAustralia, said the Coalition plan would be a “significant departure” for the sector and the emissions cuts Australia can achieve.

Prime Minister Anthony Albanese on Friday morning rubbished Dutton’s policy as a “nuclear fantasy” that would not be available until the 2040s.

“The truth is that renewables are the cheapest form of new energy – everyone knows that that’s the case and science tells us that that’s the case,” Albanese said on ABC radio.

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