Coalition Minister Doubts Credibility of GenCost Report

Just a day after the release of the GenCost report, which highlighted the higher costs of nuclear power compared to renewables, Coalition Shadow Energy Minister Ted O’Brien raised doubts about the credibility of the findings.

During a debate on ABC’s 7:30 program, O’Brien argued that the national science agency behind the report, CSIRO, lacked the expertise of the International Atomic Energy Agency (IAEA), especially in areas like cost timing.

The draft report for 2024-25 revealed that nuclear plants could cost double that of solar or wind energy, despite the potential for them to operate for 60 years compared to 30 years for renewables.

GenCost lead author Paul Graham, the Chief Energy Economist at CSIRO, pointed out that similar cost savings could be achieved with shorter-lived technologies, including renewables, even when considering the need to build them twice.

O’Brien mentioned that during a recent parliamentary hearing, CSIRO acknowledged that they were not as knowledgeable about nuclear matters as the IAEA, which provides similar calculations on capital costs but offers a different perspective on timing and potential costs.

He criticized the agency’s methodology, noting that it does not factor in “total system costs” that impact household electricity bills.

Coalition’s Seven-Plant Proposal

Opposition Leader Peter Dutton is set to reveal more details about the Coalition’s nuclear plans later this week, which includes constructing seven nuclear plants across Australia with costings expected “within days.”

Dutton stated that the plan is aimed at reducing energy prices, contrasting it with Labor’s pledge to reduce household bills by $275—an assurance that O’Brien asserts has actually led to costs increasing by up to $1,000.

O’Brien emphasized that concentrating solely on upfront capital costs, as the CSIRO report does, overlooks the bigger picture.

He added that while the Coalition’s upcoming nuclear details have similar capital costs to CSIRO’s, there is a significant departure in calculating total system costs, which directly impacts household bills.

“What affects your home bill,” he explained, “reflects the total system cost. That is the priority for the Coalition—lowering prices for Australians.”

Labor Defends CSIRO’s Independence

In response, Energy Minister Chris Bowen expressed concerns that the Coalition was casting doubt on the credibility of CSIRO, a well-regarded scientific institution with global recognition.

“Ted thinks he knows better than CSIRO and AEMO [Australian Energy Market Operator]. I don’t,” Bowen stated, defending the GenCost report and its methodology.

Bowen also expressed disappointment at the opposition’s insinuation of political interference in the report, labeling the accusation as “deeply offensive” to CSIRO’s longstanding independence and reputation.

“The conclusions are undeniable,” he asserted, mentioning that CSIRO had re-evaluated certain aspects of its modeling based on O’Brien’s feedback, only to confirm that the criticisms lacked evidence.

The last GenCost report, released in May, showed that a nuclear plant would generate energy at double the cost of renewables, take over 20 years to build, and require a minimum of $8.6 billion in investment.

O’Brien had urged CSIRO to reassess its projections on nuclear power costs after its publication.

Renewables vs Nuclear: A Pricey Debate

CSIRO’s draft report estimated that nuclear energy would cost between $133 and $222 per megawatt-hour, significantly more than solar and wind alternatives.

While nuclear reactors boast longer lifespans—up to 60 years compared to renewables’ 30 years—CSIRO stated that the upfront and ongoing costs, including waste management and decommissioning, make it a less competitive option.

Bowen highlighted delays and cost overruns in global nuclear projects.

For instance, the UK’s Hinkley C project is 12 years behind schedule and expected to cost AU$92 billion, while the United States recently abandoned its NuScale small modular reactor (SMR) project due to a 70 percent cost overrun.

However, O’Brien argued that Australia risks falling behind if it does not lift its nuclear moratorium, stating that emerging SMR technology could offer a viable alternative.

Bowen countered by pointing out the undeniable global trend towards renewables, with investments surpassing nuclear by a factor of 27.

He emphasized that Australia should focus on solar, wind, and storage solutions to deliver affordable, sustainable energy.

Nuclear Timelines Spark Further Debate

The timeline for implementing nuclear energy became another point of contention in the exchange between Bowen and O’Brien.

Bowen presented international data showing that the average construction time for large-scale nuclear reactors has extended to 12-17 years, raising concerns about how the Coalition’s nuclear strategy could align with Australia’s emission targets and energy requirements.

O’Brien defended the Coalition’s timeline by citing international benchmarks from the IAEA, which he deemed more reliable than CSIRO’s estimates on construction schedules.

“Our plan aligns with the IAEA’s construction schedule,” O’Brien claimed, indicating that the Coalition’s projections consider global expertise while still addressing Australian-specific needs.