Peter Dutton reveals costings and details behind Coalition’s nuclear policy

Opposition Leader Peter Dutton has pledged to “keep the lights on” through a $331 billion plan to introduce nuclear energy to Australia’s energy mix by the mid-2030s.

Six months after he announced the location of seven nuclear reactor sites a Coalition Government would be built across the country, Mr Dutton on Friday unveiled his costings, done by Frontier Economics, which was promptly panned by the Government who labelled it a “complete farce” filled with risky assumptions.

Frontier found Mr Dutton’s plan to introduce nuclear to make up 38 per cent of the energy mix by 2050 would save Australians up to $263 billion compared to the Government’s approach, or 44 per cent.

“We deliver a plan today which will get the energy mix right. It will lower costs, it will keep the lights on, and it will set our country up for generations to come,” he told a press conference in Brisbane on Friday.

“This is a plan which will underpin the economic success of our country for the next century.

“This will make electricity reliable. It will make it more consistent. It will make it cheaper for Australians, and it will help us decarbonise as a trading economy as we must.”

The Coalition plans to convert seven coal-fired power station sites around the country to nuclear power between 2035 and 2050. This would include two small nuclear modular reactors - technology that is not yet proven - and five large-scale plants.

They say this would provide up to 14GW of power by 2050, with renewables to make up 50 per cent of the energy mix and gas and storage the other 13 per cent.

Under their plan, coal fire power stations would run well past their current timeline, which pose a risk to Australia’s emissions reductions targets, although the Coalition claims their plan will reduce emissions faster over the long term because gas will be less relied upon.

The Coalition’s costings do not include the plan to transition the Collie power plant to nuclear.

The costings are based on a number of variables, including that Australia’s electricity output would be much lower in 2050 than has currently been modelled.

It also assumes the state moratoriums on nuclear energy can be overturned in order to get the first nuclear power station running by 2036, that there are no timeline delays, that small modular reactors become viable before 2050, and that Australia does not experience the cost blowouts - up to 3.4 times - experienced in other places.

Energy Minister Chris Bowen panned the Coalition’s plan, saying Mr Dutton had taken a serious risk in assuming Australia will need less electricity in 2050 than the market operator has modelled for, and failed to take into account for electric vehicle uptake, home electrification, and how much energy data centres and artificial intelligence systems of the future will need.

“This is a fatal error in their costings and it is a dangerous error because it is risky, it runs the risk of leaving Australians short of the energy they need. We need to be planning an energy system for economic growth,” he said.

“We need to be planning an energy system for the future, one that has data centres and artificial intelligence. We need to be planning an energy system to give Australian it is choices that they may choose to take up like electric vehicles and electrifying their homes. Peter Dutton and Ted O’Brien have based their whole plan around needing less electricity than AEMO suggests that would be.”

The Coalition claims Labor has overcompensated and been overzealous in its ambition of electric vehicle rollouts and green hydrogen, and their modelling will be more in line with what Australia actually needs.

When pressed on what guarantees he would give to Australians that the capital cost of his nuclear project would not follow all other nuclear projects in blowing out by up to three times their planned cost, Mr Dutton only said he was “confident” in the modelling projections.

Mr Dutton could also not explain how his plan would bring down power bills in the short term.

He accused Labor of a “zealot-like approach” to renewables that was “going to cause a lot of grief to our country in the near term and in the long term.” Families were paying higher power bills under Labor, he argued.

The Albanese Government has strongly disputed the Coalition’s costings.

But the plan is set to be hugely controversial, dividing industry as well as politicians, industry, and the Commonwealth.

A major hurdle the Coalition would need to overcome to get the first nuclear power plant up and running by 2036 would be convincing the states to overturn legislative bans. Asked what progress he had made convincing premiers to agree to nuclear power, Mr Dutton said being in Opposition, they weren’t “in a position to negotiate contracts” until they are elected.

But, he said he was “confident” South Australian Premier Peter Malinauskas would lead the charge.

Mr Bowen dismissed the Coalition’s strategy as a “fantasy” and a “complete farce”.

“What Australians need (is) cheaper power now, not more expensive power in decades to come,” he said.

“That is a real risk to Australia’s future.”

He said the Coalition’s plan was a risk to net-zero by 2050.

The Institute for Energy Economics and Financial Analysis said it had identified “significant issues” with the proposals, arguing that recent projects in Europe and North America have experienced significant delays and cost overruns.

“Nuclear is a costly pathway that would lead to higher power bills,” said Johanna Bowyer, IEEFA’s lead analyst.

“We have found that nuclear reactor projects constructed in Europe and North America in the past 20 years have seen cost blowouts of 1.7 to 3.4 times original amounts.”

However, nuclear engineers counter that there is no obstacle to achieving nuclear power within a decade besides politics.

“Nuclear is…the only technology that’s proven to be workable to solve this climate change problem. Renewables just can’t cut it,” said Dave Collins, managing director and principal environmental engineer of Synergetics Consulting Engineers.

The Australian political debate had been “unproductive,” he told The Nightly.

Fortescue and Tattarang chairman, Andrew ‘Twiggy’ Forrest said nuclear “doesn’t stack up for Australian families or businesses dealing with the cost-of-living crisis today”.

“We need the certainty of lower bills now, not at some distant point in the future. As our national science agency has shown, ‘firmed’ solar and wind are the cheapest new electricity options for all Australians,” he said.

“The cost of electricity generated on a grid dominated by firmed renewable energy in 2030 will be half what you would have to pay if it came from nuclear, CSIRO found.”

Prime Minister Anthony Albanese had earlier appeared to mock the Coalition proposal ahead of its long-awaited announcement.

“It’s Friday the 13th, an auspicious day, I’ve got to say, for Peter Dutton to drop his nuclear nightmare policy out there,” he said.

“We know this is a plan for the 2040s and in the meantime, I’m not quite sure what he thinks will happen with energy security.

“The truth is that renewables are the cheapest form of new energy. Everyone knows that that’s the case.”

Mr Dutton’s long-awaited nuclear costings came days after a new GenCost report by the CSIRO backed the government’s stance by stating a nuclear power plant in Australia would likely cost twice as much as renewable energy, even accounting for increased longevity of reactors.

Mr Dutton called the impartiality of Australia’s leading science agency into question – a charge CSRIO rejected in a statement on Thursday that stated: “we conduct our independent, rigorous research without fear or favour.”

Shadow Energy Minister Ted O’Brien explained that the costings in the report made clear that lower prices reflected costs over time.

“The 44 per cent difference in the cost between Labor’s approach and the Coalition’s approach, it is very safe to assume it would be comparable when it comes to price differential of that period of time,” he said.

Mr Dutton added more about the Coalition’s approach to the months-long drafting of the policy.

“What we’ve looked at is the experience of every developed country around the world, the energy mix that they using,” he said.

“And if you look to jurisdictions, for example, like Ontario or in Tennessee, they are paying 18 cents a kilowatt hour for their power at the moment because they have renewables firmed up by nuclear,” he argued.

“In South Australia, at the moment, people are paying 56 cents a kilowatt hour, three times the rate. So is it any wonder that we’ve had a threefold increase in the number of manufacturing businesses which have closed in our country over the last two and a half years?”

The Opposition Leader also addressed the question of the safety of nuclear power.

“The Prime Minister signed up to the nuclear submarines, and therefore sent a very clear message to Australians that there are no safety concerns about the latest technology in relation to nuclear,” he said, referring to the AUKUS partnership between Australia, the US and the UK,” he said.

“The AUKUS legislation that enables the nuclear reactor to be a part of our defence force and to be a key technology for us to defend ourselves, that has been facilitated through legislation, which has passed through the parliament already.”