Posted: 2024-06-19 06:54:04

Whichever way you slice it, two major parties are taking a big gamble on the future.

In one corner, you have a Labor Party plan for a grid that by 2050, will be powered almost entirely by renewables and backed by gas. In the other corner, the Coalition has gone nuclear.

Both insist their plan is the best way of achieving the holy trinity: cheaper, cleaner and reliable power.

There are too many unknowns to say, confidently, whether either will achieve it.

What we do know is that power prices have risen sharply in recent years, driven largely by Russia's invasion of Ukraine which sent coal and gas prices soaring.

Politically, this is problematic for a Labor government which was elected on a promise to cut power bills by $275 — on 2021 levels — by 2025.

At least one energy boss has warned power prices are unlikely to fall any time soon because building the wind and solar farms at the scale required to replace coal, together with the batteries needed to store the power, and the new network of transmission lines to distribute that power to consumers will involve tens of billions of dollars' worth of investment.

Opposition leader Peter Dutton has sought to directly link power price rises with the rollout of renewables, but building a fleet of nuclear power plants, from scratch, certainly won't come cheap either.

So how much will it cost?

The CSIRO has crunched the numbers and estimates building a large-scale nuclear power plant in Australia would cost at least $8.5 billion and produce electricity at roughly twice the cost of renewable sources.

It noted this cost could only be achieved by building reactors one after the other and warned the first power plant would likely be subject to what's called a "first of its kind" premium, which could double the price from $8.5 billion to $17 billion.

This is not unique to nuclear power plants, though. It's applied to any technology a country hasn't built before, and we only have to look at the NBN or Snowy 2.0 (which has blown out to $12 billion) to see what could happen.

But even in the world of big projects, nuclear power stations have among the worst track records for running over time and over cost.

The Coalition is looking to build five large-scale reactors and two small modular reactors (SMRs), which according to the CSIRO would be even more expensive (mainly because it's new technology that's still being developed).

But because they'll be located on the site of end-of-life coal-fired power stations, there'd be no need for the new network of transmission lines that's central to Labor's plan.

Dutton has said a Coalition government would own these nuclear power stations "but form partnerships with experienced nuclear companies to build and operate them".

When asked how much that would cost, he was less forthcoming.

"It will be a fraction of the government's cost but it will be a big bill, there is no question," he said.

Not only for the capital costs, but for the anticipated subsidies too.

Dutton is promising "integrated economic development zones" and "regional deals" for the seven communities and suggested a "bucket of money" might help sway some state leaders too. How much? We don't know.

What's been the experience overseas?

More than 30 countries are relying on nuclear power to decarbonise their electricity grids but most of these power plants were built before the 1990s and more recent projects have blown out in cost.

The United Arab Emirates is often put forward of an example Australia could follow. It took just 13 years to connect its first nuclear power plant, and is the only country in the world that has managed to successfully build nuclear from scratch in the last 30 years.

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