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National Affairs

Tell them they’re dreaming

11 December 2014

Nuclear power might be worth considering as a reserve option, says John Quiggin, but experience overseas shows Australia’s carbon savings must be made elsewhere

Right:

Broadly competitive: France’s Cattenom nuclear power station, on the Moselle River near the border with Luxembourg. Liquid Oh/Flickr

Broadly competitive: France’s Cattenom nuclear power station, on the Moselle River near the border with Luxembourg. Liquid Oh/Flickr


With Australia’s energy and climate-change policy in a state of chaos, it’s not surprising that we are seeing renewed calls to pursue nuclear energy. And given the urgency of reducing global carbon dioxide emissions, it would be a mistake to dismiss the nuclear option out of hand. But in thinking about the possibility of nuclear power, particularly for Australia, it is important to avoid wishful or magical thinking.

The history of commercial nuclear power is, by and large, one of failure. Costs have proved far higher than expected, catastrophic accidents more frequent, and routine breakdowns more common. After a burst of construction in the 1970s and 1980s, most countries abandoned the technology for these reasons, along with public concern about safety and radioactive waste.

Few countries have revisited that decision. A partial exception is Sweden, where the impact of a 1980 referendum calling for a phase-out of nuclear power was watered down, in 2009, by a policy allowing for the replacement of existing plants. Any such plants are at least a decade away, however.

There are two striking instances in which nuclear power appears to have worked, or have a prospect of working, at least in commercial terms. The first was the French program of the 1970s. In the space of twenty-five years, France went from a standing start to a predominantly nuclear electricity-generation system, based on a small set of standard models mainly designed by US firm Westinghouse. Unlike in most other countries with large-scale programs, the program was plagued neither by major disasters nor by obvious cost blowouts.

French electricity costs remain broadly competitive with those elsewhere in Europe, and would be more so if there were an explicit carbon price. On the other hand, recent French experience with new plants is far less appealing and much more similar to that of, say, the United States or Canada.

The second instance, which remains unproven, is the current expansion of nuclear power in China, where new plants are being built (broadly) on time and on budget, even while projects with the same designs are floundering in the West.

What do China today and France in the 1970s have in common? The answer involves a combination of factors, including membership of the nuclear weapons club, strong political support for nuclear power, a central role for state-owned enterprises endowed with (substantial) engineering resources, and a strongly interventionist government that is nonetheless capitalist in orientation. Few if any of these factors apply to Australia today.

A more realistic, though still optimistic, comparator for Australia is the United States. Support for nuclear power in that country has been strong and bipartisan, with both the Bush and Obama administrations providing extensive assistance. A push to restart the industry began with the Nuclear 2010 program, launched in 2002, and continued with the Energy Policy Act of 2005 and, more recently, with Barack Obama’s “all of the above” policy on climate change.

The results of the program illustrate the difficulties of the industry. Although numerous proposals were floated, only two new projects have commenced, each involving the construction of two new plants on an existing brownfield site. These are the VC Summer plant in South Carolina and the Vogtle plant in Georgia. Both states have electricity-pricing policies that enable the utilities to recover construction costs from consumers before any electricity is generated – in fact, even if the project is never completed. Unsurprisingly, there have been cost overruns at both sites.

The two projects have also experienced substantial delays, with the result that completion is unlikely before 2018 at the earliest. That’s a sixteen-year wait between the policy initiative and its first concrete outcomes. If we matched this, starting today, Australia might start nuclear electricity generation some time after 2030.


Even assuming an overnight, bipartisan conversion to the nuclear cause, however, Australia would be starting a decade or more behind the United States. We have no legislative framework for nuclear power, and no procedure for licensing plant designs. Our main regulator, the Australian Radiation Protection and Nuclear Safety Agency, has no capacity to regulate power plants, and would need to be replaced or upgraded.

This would raise the immediate problem of finding qualified people to staff such an agency, not to mention the much bigger task of building and operating nuclear power plants. We have no such experts, and no program to train them. Nor is importing staff a plausible option: the nuclear workforce in most developed countries is ageing: nearly 40 per cent of US nuclear workers will be eligible to retire by 2016.

Then there is the even more intractable problem of site selection. The Chinese government has no difficulty in telling people they will have to live next door to a nuclear power plant, but in democratic countries this has proved just about impossible since the end of the 1970s construction boom. Nearly all the nuclear plants under construction in developed countries are sited next to existing plants.

The brownfield option is not available in Australia. And not only do we have no policy framework that could be used to select greenfield nuclear sites, we have hardly any relevant international experience to draw on.

The development of wind farms is instructive here. Despite there being no scientific evidence whatsoever of health risks from wind farms, scare campaigns have killed numerous projects and produced stringent siting restrictions, notably in Victoria. Ironically, many of the proponents of baseless fears about “wind turbine syndrome” are advocates of nuclear power. For example, the misleadingly named Australian Environment Foundation is an anti-wind front group for the strongly pro-nuclear Institute of Public Affairs. If such flimsy objections are enough to kill proposed wind farms, how will we deal with the very real (though often overstated) risks of nuclear power plants?

Even if we could import regulatory institutions, experts and proven plant designs, there is no serious prospect of Australia producing nuclear electricity before 2040, by which time we will need to have substantially decarbonised the economy using renewables (or, less plausibly, carbon capture and storage).

Even so, following the lead of other countries on nuclear might be worth considering as a reserve option. But the proposals being floated at the moment lack even this minimal element of realism.

Business SA wants Australia to adopt the PRISM reactor, a so-called Generation IV design. Unfortunately, “design” is the operative word here: PRISM is, literally, still on the drawing board. It does not exist even in prototype form. The US Department of Energy, along with designers GE and Hitachi, looked at the idea of building such a prototype at the Department’s Savannah River plant a few years ago, but the project has gone nowhere.

Much the same is true of another popular piece of nuclear vaporware, the “small modular reactor.” All but one of the American firms hoping to produce a prototype have abandoned or scaled back their efforts. The remaining candidate, NuScale, is hoping to have its first US plant operational by 2024, with commercial-scale production some time in the 2030s. And, of course, there’s no guarantee that the new designs will work in economic terms, or that the problems of waste disposal and proliferation can be resolved.

Even assuming this optimistic projection is met, small modular reactors aren’t going to be a viable option for Australia any time soon. Unfortunately, that didn’t stop the Bureau of Resources and Energy Economics from asserting, in its 2012 Australian Energy Technology Assessment, that “SMR technology could potentially be commercially available in the next five to ten years” and presenting it as a low-cost option for 2020. This absurdly optimistic claim was abandoned in the 2013 update, which drastically increased the estimated costs and dropped the claim that the technology would be feasible in 2020.

There is still a chance for nuclear power to contribute to decarbonisation of the global economy in China and other countries with an existing program or the state power to force through a crash program. But these conditions don’t exist in Australia, and there is no serious prospect that they will do so in time to play a substantial role in decarbonisation. Anyone who pretends nuclear power is a serious option for Australia under current conditions is dreaming or, worse still, deliberately diverting attention from the real issues. •

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