One of the big policy questions for Australia is whether we can achieve net zero greenhouse gas emissions without having some nuclear power plants. As Bill Gates wrote in his 2021 book How to Avoid a Climate Disaster, the “one-sentence case” for nuclear power:
…it’s the only carbon-free energy source that can reliably deliver power day and night, through every season, almost anywhere on earth, that has been proven to work on a large scale.
Australian governments currently have plans to substantially increase the contribution of renewable energy, such as Queensland’s 70 percent 2032 target. Given the intermittency of renewables Gates is alluding to (e.g. no solar energy is generated at night), energy storage solutions such as pumped hydro and grid-scale batteries are important parts of government plans. So far, Australian governments have stuck with their historical ban on nuclear power. But it is possible they may need to reconsider this policy, if there are challenges building sufficient storage in time to back up an electricity grid increasingly reliant on renewables. The cost implications of greater renewables penetration are unclear, too, given the need to spend a lot more on network infrastructure.
These considerations are pushing more people to ask whether Australia should adopt nuclear power. Recent power price increases suggest that our energy policy settings need reform. Also, Australia committing to nuclear submarines as part of the AUKUS agreement has led some commentators, including former Prime Minister John Howard, to ask why not use nuclear power more widely?
Hence it is timely to discuss whether nuclear power should play a role in Australia’s transition to net zero, as the Brisbane Dialogues group is doing at an upcoming event in Brisbane on 8 August 2023:
Adept Economics has long been monitoring the debate over nuclear energy. In the latest episode of the Economics Explored podcast, Adept Economics’ Gene Tunny and Tim Hughes had a wide-ranging conversation with eminent British economist Sir David Hendry which included a discussion of the transition to net zero and the potential role of nuclear energy. Regarding small modular nuclear reactors (SMRs), Sir David told Gene and Tim that SMRs have a role in the transition to net zero. After noting he is arguing for small reactors rather than big reactors, which produce a lot of transuranic waste, Sir David noted:
There are two advantages to small nuclear reactors. One they can use that transuranic waste as their fuel and greatly reduce the amount of radioactivity that needs to be dealt with from it. And secondly, they’ve been used in nuclear submarines for 50 years, and there’s never been an accident. So they’re very safe. And they don’t have any fissionable material that terrorists might want for bombs…
…they are actually an important component, but only one possible component of an electricity provision, that would give more energy security. And they can be something that can work in almost all circumstances.
SMRs will no doubt be one of the items for discussion at the upcoming Brisbane Dialogues event. For further information on SMRs, check out these previous Adept Economics articles:
Published on 27 July 2023. This article was prepared by Adept Economics Economic Director Gene Tunny with input from Research Economist Arturo Espinoza. For further information please get in touch with us via firstname.lastname@example.org or by calling us on 1300 169 870.