Replacing Australia’s retiring coal power stations with small nuclear reactors could cost $387bn, analysis suggests
The federal government says it would cost as much as $387bn to replace Australia’s retiring coal-fired power stations with the form of nuclear power proposed by the Coalition.
The figure, produced by the energy department, is the projected cost of replacing all of the output from closing coal-fired plants with small modular reactors.
The opposition leader, Peter Dutton, has previously suggested that Australia “could convert or repurpose coal-fired plants and use the transmission connections which already exist on those sites”.
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However, he has not been explicit about how much of the coal-fired electricity output would be replaced with nuclear-sourced energy – an uncertainty that makes projecting the cost difficult.
The figure adds fuel to the growing political dispute over the pace and form of Australia’s energy transition.
The government said the new analysis showed a minimum of 71 small modular reactors – providing 300MW each – would be needed if the policy were to fully replace the 21.3GW output of Australia’s retiring coal fleet.
“According to the 2022-23 GenCost report modelling under the current policies scenario, this could cost $387bn,” a government summary said.
“This is due to the estimated capital cost of $18,167/kW for [small modular reactors] in 2030, compared to large scale solar at just $1,058/kW, and onshore wind at $1,989/kW.”
The government said this would represent “a whopping $25,000 cost impost on each Australian taxpayer”.
The minister for climate change and energy, Chris Bowen, said the opposition wanted to promote the benefits of “non-commercial” small modular reactor technology “without owning up to the cost and how they intend to pay for it”.
“Peter Dutton and the opposition need to explain why Australians will be slugged with a $387bn cost burden for a nuclear energy plan that flies in the face of economics and reason,” Bowen said.
“After nine years of energy policy chaos, rather than finally embracing a
clean, cheap, safe and secure renewable future, all the Coalition can promise is a multi-bullion-dollar nuclear-flavoured energy policy.”
Dutton identified Liddell as a possible site for a small modular reactor when he gave a pro-nuclear speech in July.
At the time, Dutton said he saw nuclear “not as a competitor to renewables but as a companion” and he wanted “an Australia where we can decarbonise and, at the same time, deliver cheaper, more reliable and lower emission electricity”.
He called on the government to consider removing legislative prohibitions on new nuclear technologies – a step the former Coalition government didn’t attempt during its nine years in power – “so we do not position Australia as a nuclear energy pariah”.
Dutton further accused Bowen of burrowing “so deeply down the renewable rabbit hole that he refuses to consider these new nuclear technologies”.
“The new nuclear technology train is pulling out of the station. It’s a train Australia needs to jump aboard.”
The estimates released by the government on Monday are partly based on the costs for small modular reactors outlined in the CSIRO’s GenCost report.
That report notes that global commercial deployment of small modular reactors is “limited to a small number of projects and the Australian industry does not expect any deployment here before 2030”.
The report notes some uncertainty around the projections.
“Nuclear SMR current costs are not reported since there is no prospect of a plant being deployed in Australia before 2030,” said the CSIRO report, released in July.
“However, some improved data on nuclear SMR may be available in future reports and projected capital costs for SMR have been included from 2030 onward.”
The federal government has set a goal of 82% of electricity coming from renewable energy by 2030, up from about 35% today.
To achieve this, the federal government has committed $20bn in lowcost finance for “rewiring the nation” – updating transmission lines – but is facing pushbacks from rural communities.