Australia has a large uranium industry that supplies around 8% of global demand. And, after receiving a construction licence in 2002 it successfully built a 20 MWt research reactor (named Opal) at the Lucas Heights facility on the outskirts of Sydney, which started up in 2016. However nuclear power remains illegal in Australia.
That exclusion was questioned most recently in June this year, when Peter Dutton, leader of the opposition unveiled a plan to build seven nuclear power plants on sites that would be acquired by the Australian Commonwealth (via the national government in Canberra). He named potential sites as Tarong and Callide in Queensland; Mount Piper and Liddell in New South Wales; Collie in Western Australia; Loy Yang in Victoria; and Northern power station in South Australia. He suggested the plants could start coming on stream by 2035.
The proposal has kicked off debate in Australia, which is expecting to phase out its aging coal-fired stations over the next decade, to be replaced by lower-carbon generation.
The Canberra government responded by setting up a Select Committee on Nuclear Energy to carry out an inquiry into nuclear power generation in Australia. The Select Committee began taking oral evidence in October and is due to produce its report in March 2025.
The debate comes as Australia’s Commonwealth Scientific and Industrial Research Organisation (CSIRO) and Australian Energy Market Operator (AEMO) published their annual ‘GenCost’ report, which estimates the cost of building new electricity generation, storage and hydrogen production in Australia. This year the authors addressed three common criticisms of their approach to assessing the cost of nuclear power (see box).
Minister Chris Bowen hit back at the Dutton plan, which would also see a pause in building the pipeline of new renewable energy projects until the proposed nuclear plan was under way. Bowen claimed that Dutton’s plan “will result in a staggering 49% gap between demand and the supply available to meet it”.
Simon Duggan, Deputy Secretary at the Department of Climate Change, Energy, the Environment and Water, in Canberra, was questioned about Bowen’s claim during a Select Committee hearing on 24 October. He said the department “provided calculations on the basis of the assumptions that were put to us”, which included the coal closure schedule and an assumption that there was no further investment in renewable energy beyond what is already classified as committed. “On that basis, the sum of those two things then led to the estimate of an 860 TWh cumulative projected shortfall from 2025 to 2035.”
Duggan also gave an indication of the importance of the nuclear debate where the environment for investors is a key factor in attracting companies to enter bidding rounds to provide new generating capacity – and making auctions competitive by attracting enough companies to take part. That requires maximum visibility of the future market.
Committee chair Dan Repacholi (from the governing Labor Party) asked: “What will pause that investment pipeline, do you think?” Duggan warned of uncertainty over the time frame for the closure of coal-fired power stations and added, “Not knowing when the competing technology will exit the system means that you have a higher degree of uncertainty about what your revenue outlook is.”
Zaneta Mascarenhas MP asked: “If we consider a scenario where renewable investment is slowed down in anticipation of nuclear power generation after 2035, could you describe the implications for system reliability, the supply and demand balance and possibly consumer price implications?” Duggan noted that there would be ongoing implications for discussion of, for example, combined cycle gas turbine capacity factors, natural gas fuel costs and efficiency.
The new nuclear timetable
While it is important for investors to understand the time frame for coal plant closures, equally important is knowing what other generating technologies could enter the frame.
A pause in renewable energy investment, for example, might bring forward gas turbine investment to meet capacity needs long before new nuclear could be built. So on 24 October the Select Committee members had questions for witnesses over the timetable to license and build a nuclear power plant in Australia, which is expected to be up to 15 years. Committee members asked about lead times closer to 10 years in the UAE and less in other countries, and the IAEA’s current estimate of 10-15 years as a typical lead time. However, the witnesses all suggested that in Australia a new nuclear unit was likely to move more slowly rather than more quickly in comparison with those countries.
Among the work that would have to be done would be signing international nuclear treaties, setting up industry governance and regulation, finding and qualifying sites, and developing a nuclear workforce. That was despite the fact that in all these areas Australia’s current nuclear activities meant that the country had some ability to meet the needs of a nuclear power programme. For example, Claire Savage, chair of the Australian Energy Regulator, said: “I don’t know about building nuclear power stations, but I do know about developing regulatory frameworks.” She explained, “By the time you do licensing, safety, environmental, technical, commercial, and you do legislation, rules, guidelines and consultation – for us just to do guidelines takes 12 to 18 months because you have to do an issues paper, a draft decision and a final decision, and there are two rounds of consultation that we’re required to do under the rules.” She concluded: “I would have thought you would be looking at eight to 10 years for a regulatory framework.” Others were particularly concerned about the time required to gain a ‘social licence’ (ie favourable views locally), to select a nuclear site and to consult with local people.
The Select Committee will continue to hear further evidence before it issues its final report. Nuclear advocates are arguing hard that nuclear could have a role in the long term, even if it is not deliverable before 2035. Whatever their other objections to nuclear, its Australian opponents can point to the long-term nature of any ‘build’ programme – which could not even begin until ‘no nuclear’ legislation is repealed.
For electricity consumers in Australia, what is most important is to have a clear view ahead, so the country can attract the right investors for whichever suite of low-carbon generation technologies are appropriate. That suggests it is the right time to debate the nuclear issue, either to move decisively to sweep away restrictions, or to put the question to bed for a generation. But the debate has to have a quick resolution to ensure there is not a gap in the pipeline of investment in new generation.
