Peter Dutton can’t seem to take a trick on nuclear power. Any option he puts forward seems to vanish as soon as he makes a commitment.
Since Dutton became opposition leader, he’s pushed the idea of small modular reactors (SMRs). At least in their original concept, these were reactors small enough (say 50-to-70MW capacity) to be built in a factory and shipped to sites where they could be installed in whatever number was required. The leading candidate was NuScale, a US firm that had contracted with a group of utilities in Utah to develop a pilot project of 12 (later reduced to six) SMRs.
The idea had the enthusiastic backing of the Australian Nuclear Science and Technology Organisation (ANSTO), the government’s official adviser on nuclear technology. The ANSTO website includes information on how SMRs can be constructed in three to five years, and that the US will have them operational by 2026.
That sounded too good to be true, and sadly, it was — NuScale abandoned its project late last year. After a bit of prodding, ANSTO added a disclaimer and a note that the “three to five year estimate” came from a research paper by the University of Leeds, which in turn could be traced to a dodgy consulting report from 2014.
On nuclear, Coalition prefers the optimism of misleading, decade-old, unverified claims
Having given up hope on NuScale, Dutton needed an alternative.
He settled on Rolls-Royce, a reassuringly familiar name with a long track record of engineering excellence, not always matched by its financial success (it was famously nationalised and broken up by the Conservative UK government in the 1970s). It produces the nuclear reactors to be used in the submarines we will acquire under the AUKUS deal.
Rolls-Royce also offers what it calls an SMR, though this is something of a misnomer. At 470MWe, the reactor scarcely qualifies as small. It’s far too big to be built in a factory and shipped to its installation site. The “modular” description refers to the fact that the design uses 1,500 “modular components”, which are to be produced in a factory then assembled on site.
This is precisely the approach that was attempted, unsuccessfully, in the Westinghouse AP1000 design. Of four AP1000 reactors started in the US, two were abandoned with a loss of billions of dollars while the other two (at Vogtle in Georgia) have finally been completed, years late and billions over budget.
Despite these concerns, Rolls-Royce looked like a frontrunner, at least in the UK. Its design was the first to enter the Office for Nuclear Regulation approval process in 2021, with a target delivery date of 2030. The UK government provided £210 million (about A$400 million) in funding to support the project.
So, late last week, Dutton briefed Simon Benson at The Australian on a plan to deliver Rolls-Royce reactors into the grid by the mid-2030s.
What could go wrong? Plenty it seems. Just as The Australian story appeared, the UK government announced the winners of a grant to build SMRs in County Durham, and Rolls-Royce was not among them. UK deployment of the Rolls-Royce design now seems unlikely.
Rolls-Royce is now talking about building its first plants overseas. Poland has been mentioned as a possibility, but that’s a furphy. Under the now-departed Law and Justice government, Poland announced deals involving a string of different reactor designs: the AP1000, the GE Hitachi Nuclear Energy’s BWRX-300 (a direct competitor for Rolls-Royce), Last Energy microreactors, and even NuScale. Few if any will actually be built.
So, if Dutton goes ahead with Rolls-Royce, Australia could be in the unenviable situation of building “first of a kind” (FOAK) reactors with an untested design. Even more than nuclear plants in general, FOAK projects are notorious for delays and cost overruns. For a country like Australia, with no established nuclear industry or regulatory structure, it would be madness to try such a thing.
What next for Dutton’s nuclear policy? There’s still time for a climbdown before the policy is officially announced, but it’s unclear that the nuclear true believers in the LNP would accept such a thing. He could switch to a design with slightly better chances, such as the BWRX-300, but that would risk a third embarrassment if the design failed. So he has little choice but to press ahead with the Rolls-Royce dream and hope that it is not finally dispelled before the 2025 election.
John Quiggin 
I agree the nuclear proposals do not make much economic sense.
But opposition to such proposals is costless – they have few friends.
I’d be interested to know if John supports proposals for “made in Australia” subsidies and selective tax breaks (hidden subsidies) for green industries such as the production of solar cells or batteries.
Like nuclear options this would (in my view) impose long term efficiency costs on the economy. It would make Australia poorer. I can’t see any positive externality spillovers from such subsidies nor any distributional arguments favouring them. .
Moreover, the argument that other countries (such as the US and maybe China) are subsidising their exports does nor seem to suggest we should do the same. Instead I think when we import such goods that we should relay to these countries our sincere thanks for their generosity in reducing our bills.
When I was an undergraduate during the end of the 1960s I never believed that the hefty protection that Australia gave its manufactures would end. The Whitlam 25% tariff cut stunned me and other economists at the time it occurred. It was a massive reform.
Do we really want to reverse these sorts of moves? It took decades to get rid of protectionism in Australia. Even if it is electorally saleable at the next Federal election to those without economics training is this an good way for our politicians to go?
This isn’t a partisan view since Peter Dutton seems almost to endorse a protectionist revival of manufacturing. Once such policies are in place the billionaire rent seekers already clamouring for handouts will not only want them to continue but will seek to have them expanded. They will get close to bipartisan support.
Harry Clarke
It is material that none of the baseline renewable energy technologies creates a long-term dependence, as with fossil fuels. PV panels have no moving parts and the limited maintenance they need is local. Traded green hydrogen reproduces the poisonous dependencies of fossil gas, another reason to be suspicious of it. I don’t see a case for protectionism either.
Harry Clarke: – “Moreover, the argument that other countries (such as the US and maybe China) are subsidising their exports does nor seem to suggest we should do the same. Instead I think when we import such goods that we should relay to these countries our sincere thanks for their generosity in reducing our bills.“
I’d suggest that assumes that transport energy remains cheap and abundant. Evidence/data I see indicates:
Per the Energy Institute’s Statistical Review of World Energy 2023, from page 17, the top-3 crude oil + condensate producing countries represent more than 40% of the global share of production, the top-5 represent more than 50% and the top-8 represent more than 65%. Very few countries provide most of the world’s crude oil production.
The main transport mode for global trade is ocean shipping: around 90% of traded goods are carried over the waves.
Nearly all ships traversing the waves rely on either heavy oil or diesel fuel for propulsion.
On 9 Jan 2024, The Oil Crash blog posted a piece titled Peak Diesel: 2023 Edition by Rafael Fernández Díez. It concluded with (translated to English):
Nationals Leader David Littleproud MP appeared on a TV broadcast on Sky News Australia yesterday morning (Apr 22) with Laura Jayes, Political Reporter and Anchor of AM Agenda. Littleproud said from time interval 0:01:57 (bold text my emphasis):
“Let me, let me just say the technology is there for nuclear already, and, and that’s what we’ll be using; is already a technology that exists, particularly ah, in, in the medium size technology. So, it is there; it’s been used around the world, and that’s what we’ll base it off.”
It seems Laura Jayes missed the opportunity to explore with David Littleproud:
I’d suggest these are obvious questions that should have been asked, but apparently were not.
When are Australian journalists going to do their jobs properly using real evidence/data to challenge the Coalition on their dangerous nuclear policy fantasy that threatens Australia’s energy security?
On 8 May 2024, Rosemary Barnes (aka Engineering with Rosie) published a YouTube video titled Four Reasons Why Nuclear Power is a Dumb Idea for Australia. Her 4 reasons include:
I posted some comments below the video, some sticking, others disappearing into the ether. Those that stuck included:
I received a reply from @factnotfiction5915 within a few hours. I’ve tried replying a few times, but nothing stays – any comments I’ve posted so far disappear within minutes. I can still see the last comment I posted yesterday, but only if I’m logged in, but can’t see it if not logged in:
I don’t know why some of my comments are being deleted. I’m not impressed with this experience. Does anyone else comment at YouTube and have problems with their comments being deleted at YouTube?