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Those hoping nuclear energy – and the boost to local projects that could come with it – might be on the cards for Queensland, will be disappointed by analysis released by the Federal Government which claimed the state’s economy would be nearly $900 billion worse off by 2050 under the opposition’s plan to build two reactors there.
The analysis was released on Monday night, hours after Prime Minister Anthony Albanese visited Queensland’s Gympie and Rockhampton as part of a pre-election tour.
Based on calculations from Australian Energy Market Operator figures, it claimed the Liberal-National coalition’s proposal to build and operate two nuclear reactors in the state would affect its economy by $872B, in addition to affecting Queensland’s output by $61.1B in 2050-51 alone.
Commenting on the latter factor, Mr Albanese said opposition leader Peter Dutton’s nuclear plans would take Australia backwards in terms of economic activity.
“Under the Coalition [Dutton’s] vision is for a smaller Australia, is for making less things, is for less economic activity, is for less jobs,” he said.
“A Soviet-style command economy of the energy system with his nuclear plan, because no one in the private sector would touch this with a barge pole because it doesn’t add up economically.”
No atomic future for the Sunshine State?
According to Dutton’s nuclear strategy, seven reactors would be built across Australia, with two in Queensland, these being Tarong, north-west of Brisbane, and Callide, west of Gladstone.
The additional five would be Liddell and Mount Piper in New South Wales (in the Hunter Valley and near Lithgow respectively), Port Augusta in South Australia, Loy Yang in Victoria’s Latrobe Valley, and Muja in Western Australia (near the town of Collie). Per the plan, these would be operational between 2035 and 2037.
The proposal offers a series of challenges to Australia: A country that contains the world’s largest deposits of uranium, but only one nuclear reactor (Lucas Heights in Sydney, used solely for scientific and medicinal purposes).
Like many other Australian states, Queensland has a ban on uranium mining – this has been in place since 1989 – although exploration and development is ongoing at three main deposits.
These are Laramide Resources’ (ASX:LAM) Westmoreland – located in the far north, Paladin Energy’s (ASX:PDN) Valhalla – close to Mt Isa, and Ben Lomond – west of Townsville, which is being developed by Canadian company IsoEnergy. Mining previously occurred within the state, with production from the Mary Kathleen mine (also near Mt Isa) running from 1958 to 1982, when its resources depleted.
And Queensland’s political outlook on the issue is conflicted: On one hand, the state gov’t just recently elected in October under David Crisafulli has indicated it would push back against Peter Dutton’s nuclear plans.
At the same time, figures such as Robbie Katter – the Katter Australia Party member for Traeger (near Mary Kathleen township) – have said he would like to start a conversation about domestic supply.
The numbers behind Dutton’s nuclear plans
After a lot of chatter about the coalition’s proposal to place uranium at the heart of its energy strategy, it called on consultancy firm Frontier Economics to produce a financial modelling report, which was duly released in December.
According to this, the capital and operating costs of the coalition plan (of 7 nuclear reactors across Australia and net zero emissions by 2050) would be $331B – or $263B less than Labor’s plan.
According to the coalition’s plan, Australia’s energy market (by 2050) would be comprised of 54% renewable energy and 38% nuclear energy, with the rest made up of storage solutions – gas and batteries. By contrast, Labor’s vision for energy by that time would be built around 94% renewables.
Another difference lies in the approach to coal from each political side: Labor anticipates the phasing out of coal-fired energy by 2034, while the coalition has acknowledged its plan would see coal being a feature of the market past that point, with nuclear reactors not going online until 2036.
But is the argument about lower costs correct? Labor has said no, pointing to statements from national science agency the CSIRO that nuclear energy would be significantly more expensive for Australia.
In December, the CSIRO said building a nuclear power plant would cost twice as much as renewable energy, and that power plants would provide few financial benefits despite having a relatively long shelf life.
Crucially, it argued, “Long development lead times mean nuclear won’t be able to make a significant contribution to achieving net zero emissions by 2050.”
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