Commodities | Nov 21 2006
By Greg Peel
Ex-Telstra boss Ziggy Switkowski has just handed down a draft report, commissioned by the Howard government, assessing the pros and cons of nuclear power in Australia. The committee behind the report had been seriously criticised before the project even began, based on accusations each member was already pro-nuclear.
It was no great shock, therefore, that Ziggy decided Australia should consider a nuclear future. The first reactors could be up and running possibly in ten years, but more realistically fifteen, he suggests. By 2050, Australia could be generating 30% of its electricity needs from 20 reactors.
Reactions across the political spectrum were predictable. The government has embraced the nuclear question right from mining through to power generation. The Opposition is opposed to building nuclear reactors in this country, but might endorse further uranium mining so others can. The Greens are opposed to anything nuclear.
There are some sobering realities in the Switkowski report, however, for radioactive fans. Nuclear power station building is an expensive exercise, costing some 20-50% more than fossil fuel plants. The only way nuclear energy could be economically viable is if there were an offsetting penalty imposed on carbon emitters, such as a carbon credit scheme. Even then, the government would likely still need to subsidise a nuclear industry in the start up stages (meaning for a very long time yet).
The issue of waste is still a stumbling block, although the report noted the cost of dealing with waste would only be 1% of the cost of electricity produced. Fossil fuel waste is still a comparable problem, it’s just that it doesn’t glow. The question of where a nuclear dump might be situated was not addressed.
Nor were any specific locations offered for reactor sites. One of the biggest challenges the government faces is exactly where it can put reactors without evoking the usual NIMBY hostilities. One important consideration is water – nuclear power generation requires substantial amounts. It has been noted previously that reactors would likely have to be in easy reach of seawater for cooling systems. Bondi?
Nuclear power generation aside, the report did note that the government should at least consider a nuclear enrichment industry. All of the uranium leaving our shores is in yellow cake form, which requires enrichment to take it to the power station (and weapons-grade) level. The report estimates an enrichment industry would be worth $1.8 billion to Australia, four times more than the current export industry.
There is further upside in an enrichment industry, in that it would make Australian uranium and its uses far easier to trace. There has even been talk of a system whereby customers must hand back the spent fuel for disposal.
In June the head of the Government’s nuclear organisation, Dr Ian Smith, said four or five nuclear power stations would be needed to make a nuclear industry viable. This renders Ziggy’s suggestion of 20 reactors quite ambitious. However, the Howard government has made climate change its number one issue in a screaming about face recently, when polls showed more Australians were concerned about this issue than they were about terrorists. Suddenly the Stern report is gospel, and that warns that action must be taken in the next ten years.
The report makes no specific recommendations. It is basically food for thought.