Super industry gets behind nuclear power
Australia’s union-backed superannuation industry has made the case for nuclear energy and demolished repeated claims wind and solar are the cheapest long-term option for reliable power.
A major report says backing up a renewable energy system for 1½ days would require about 100 Snowy Mountain 2.0 pumped-hydro schemes at a total cost of $700 billion. This was the same as building 100 to 150 nuclear reactors, which could provide well over half of Australia’s current primary energy needs.
Using Tesla batteries to achieve the same 1½ days’ backup would cost $6.5 trillion, which could build about 1000 nuclear reactors, the report said.
“The key takeout is that intermittent technologies may not provide the best means of delivering all primary energy,” the report said. “It is also doubtful whether they are the best means of providing all electricity at current levels of demand.”
The superannuation industry report is based on meeting a carbon-neutral objective by 2050.
It said the best way to do this was to set a final destination and work back from there.
“The question should not be ‘renewables or coal’. The focus should be on the best strategy to reduce atmospheric greenhouse emissions,” the report said.
“Australia carries a much higher level of risk than most first-world countries by not having the ability to incorporate nuclear energy into its mix.”
The report challenged repeated claims that renewable energy projects were the cheapest option to replace Australia’s ageing coal fleet.
“An energy technology that is lowest cost per unit is not necessarily the best choice if it cannot meet capacity and reliability requirements,” it said.
The report said the common practice of relying heavily on estimates of levelised cost and market tests applied to developments in isolation could be misleading.
“Worse, it may cause serious economic damage to the national economy if narrowly defined economic gains lock in long-term inefficiencies.”
The superannuation industry report said it was “difficult to see how these problems can be resolved without some nuclear in the mix and the principles of optimality, fairness and merit would suggest it should not be discounted.”
In the short run, the report said, there was considerable scope for increasing the use of solar and wind because of the large buffering potential of existing fossil fuel plants.
But it was difficult to see what would happen if solar and wind went beyond 50 per cent of electricity or about 10 per cent of primary energy.
“It is possible that beyond about 50 per cent of electricity, some solar and wind may become stranded assets,” the report said.
“This would begin to raise serious questions about the trajectory of the energy system.”
It said the most important options to consider were solar, wind, nuclear in various forms, coal and combined-cycle gas generation and carbon capture and storage.
Energy Policy Institute of Australia executive director Robert Pritchard said genuine technology neutrality was fundamental to continued investments in the energy sector.
“The investment process in Australia has been undermined by the lack of it,” Mr Pritchard said. “This in turn has led to a destabilisation of the power system itself.”