Wednesday, 29 May 2024

Nuclear energy

Nina TAYLOR (Albert Park) (16:46): I grieve for my fellow Victorians today, and the reason is that here we are in Victoria decarbonising at the fastest rate in the country, doing the right thing and transitioning to a cleaner energy future for benefits of cost, because we know that renewables are definitely the cheapest form of energy – and also a very rapid structural implementation is enabled through or can be facilitated with renewables when it comes to that transition – but instead they just throw out thought bubbles like nuclear: ‘Let’s just go with nuclear.’ And we know not only that the state opposition has supported this, but also when asked if he would support the federal opposition leader’s push for nuclear energy on ABC radio this year Mr Pesutto said that:

… nuclear will almost certainly play a part in our energy mix going forward.

This was on ABC radio, 4 March 2024, just to be precise. What does this actually mean? I should unpack why we are actually so strident in terms of backing in clean, renewable energy in Victoria. Well, we like to listen to scientists. The CSIRO’s recent GenCost 2023–24 report again confirms that nuclear is the most expensive form of power generation available, and the cheapest forms of power, which I said from the outset, are wind and solar. Now, what is really important here – and I think is certainly something that piqued my interest when listening to the report that was fed back from the recent GenCost 2023–24 report itself – is that they factored in all aspects. They were looking at storage and otherwise in terms of the cost element.

So to be clear, the cheapest forms of power are wind and solar, even when coupled with the cost of energy storage and transmission, because that is really, really important. We have to be really practical when we are looking at costs and comparing in this context. This includes, I should say, the cost for building new transmission, because I am just picking up on some comments that were made in the chamber about transmission – of course it is incredibly important to be able to get the energy where it needs to go efficiently – and firming capacity, like batteries, to complement the new, renewable energy projects. So you can see that due diligence has been undertaken when making these very precise comparisons between different forms of energy that can be taken up for our great state.

We know that we have abundant sunshine and wind, and so we certainly have a competitive advantage when you are looking at what forms of energy we choose to invest in for our great state. You can see that there are a lot of sound reasons for why we are investing so aggressively – but for the right reasons ‍– in renewable energy. And, yes, Victoria already has the lowest wholesale power prices in the national electricity market. Why is this? It is because of our record investment in renewable energy over the past eight years. We have form, but it is good form, and it is certainly, as you can see, backing in the very sound investments in clean energy.

I want to refer a little bit further to the CSIRO’s recent report, because according to their cost estimates, constructing sufficient nuclear capacity for a 1600-megawatt capacity power station approximately the size of the decommissioned Hazelwood power station would cost $25.6 billion. But it does not stop there when you are looking at the cost, because we know that there are some who like to just throw nuclear as a nice little distraction point – maybe they think it is actually feasible – but it is really important to unpack exactly how this has unfolded across the globe. We actually can see the reality of what nuclear – implementing and building a nuclear reactor or a whole system – would cost our country. We know the costs for a large-scale nuclear plant in a GenCost report were based on figures taken from projects in South Korea, which are considered amongst the lowest in the world. So you can see there that the CSIRO has been very diligent in terms of making sure that they do the tightest possible comparison so as not to in any way unnecessarily inflate or exaggerate what might be the potential costs were we to go down this path here. Thankfully we will not. I can honestly say that our government will not go down the nuclear track. That is absolutely a path that we will not go down. We know that Victorians do not want that path either; they have very much backed in the investment in renewable energy.

Certainly a big part of the excitement about bringing back the SEC – we were very up-front about it at the election; no-one was shy in any way, shape or form – was because of the opportunity that it facilitates to actually expedite the investment in renewables and transition for our state. Just coming back to this cost factor, because this is absolutely vital, because we are looking at the cost of living and saving Victorians money when it comes to energy and investments, South Korea’s costs, relatively speaking, are lower than other nuclear nations because they have maintained – and this is actually another really interesting point – a continuous build program over an extended period. This is not actually what has been proposed by the opposition, because it is more – and I am going to have to paraphrase a little bit here – ad hoc: a few reactors here and there around the traps. The problem with that is you are not getting the scale-up which would actually facilitate better economies of scale, so to speak. That is actually really vital when we are talking about something as critical as the choices we make in terms of investment in energy.

A continuous build program also makes it easier to provide skilled labour as there is a clearer career path for workers. So, again, you can see that when we are looking at this very important issue of energy, we are looking at the whole picture from the outside – not only accessing the relative resources, whether it be sun and wind as is the case with renewable energy investment, but also what sort of workforce and what skills are required in order to do these ambitious but necessary rollouts. None of these things are true of Australia. The coalition are proposing to build maybe a handful of reactors, so there is no scale and no existing workforce and not much incentive for workers to move to that industry. We know that to manage something as complex as a nuclear reactor you are going to have to have a very elevated skill set, and I say that with the greatest respect, because of the complexity of managing not only the reactor but the safety aspects as well. Despite the CSIRO’s take on these generous assumptions, nuclear still comes in – get this – several multiples more expensive than renewable energy. So you can see why there are various very critical parameters when you are looking to critically evaluate, ‘Okay, what is the best option for Victoria into the future?’

This is another thing that I wanted to factor in as well, because I originally quoted what it would cost to build a large-scale nuclear reactor. Experience in other countries demonstrates that initial cost estimates are almost always far too low. The UK is currently building a new 3260-megawatt nuclear plant in Somerset known as Hinkley Point C. It provides a valuable lesson in creating a nuclear rod for your back, literally – pardon the pun. The plant was initially estimated to cost $30 billion – that was back in 2016 – or £18 billion, to be precise. The most recent estimate is that the project will now cost $61.2 billion, or £32.7 billion. In anyone’s language we can see that there is some significant embellishment, and I am not saying exaggeration; these are actual costs. But we can see that, on anyone’s terms, that is a huge blowout.

I will give another example. The most recently completed nuclear plants in the US are Vogtle 3 and ‍4. Vogtle was built as a pair of reactors, not a single plant, in the hope that this would increase – I am coming back to this point – scale efficiencies and reduce costs. Instead the project ran over by seven years and cost more than $25 billion more than originally budgeted. The cost overruns were so significant that Japan’s Toshiba Corp, which was at the time the owner of Westinghouse, paid, in Australian dollars, a $5.6 billion penalty to be released from their contractual obligation to deliver the project at a fixed price. Even having to pay that for a penalty seems pretty significant in anyone’s terms. All told, the two reactors cost close to, in Australian dollars, $50 billion.

We can see that the economics just do not stack up. I remember when I was on the inquiry into nuclear prohibition when I was in the upper house it evaluated so many of these aspects, including costs et ‍cetera. We could see at that time that with costs alone it just did not make sense, let alone the fact that climate change is well and truly underway. We simply cannot wait for the time that it would take to build a full-scale nuclear reactor.

I am going to give another example, because people often say, ‘Oh, France, they’ve nailed it. It’s all perfect there. Nuclear – perfect.’ But a new plant in Flamanville in France was originally expected to be completed in 2012. Ten years later it is still not producing electricity, and yet the French – and no disrespect – are held in the highest regard. People who love nuclear tend to like to espouse, ‘Oh, France, they’ve got that mastered,’ yet we can see here that they have had significant problems in terms of actually getting that energy online, and at the end of the day people need energy now.

Australia would not have the economies of scale, so we are not going to be able to make it affordable, and we really do not have time to wait 15 years to be able to build a large-scale nuclear reactor. Part of why there is the delay and why it takes so long is that you need so many tonnes of concrete and structural mechanisms, if I cut to the chase, because of the risk, because it is a highly toxic form of energy, and it really does not make good sense. And of course to date there is no long-term storage facility for high-level nuclear waste. Nobody has nailed that around the globe. Nobody has mastered that, so that does not give me any confidence – when you think how long nuclear bombs et cetera have been around the planet, the fact that even today they have not nailed the very basic thing of where you put that highly toxic, highly radioactive nuclear waste.

I can assure you, and I am going to speak for the people of Albert Park, I do not think they are going to want to take that. I am very confident they will not, but by the same token, I do not want to inflict it on any other electorate either. I do not think that is fair. Whether it is the Latrobe Valley, whether it is out in Werribee or wherever it is, I do not want to do that. I am thinking of all Victorians, not only the constituents in my own electorate. Naturally the community are concerned about where that waste is going to be stored, because if it gets into groundwater et cetera how do you stop the damage? I know even in France they have a lot of problems because they are running out of space. They have to keep digging deeper and deeper and deeper to put this stuff underground, and you cannot leave it there forever, because they put it in these barrels and every so many years you have got to dig up the barrels and change the packaging and put them back down. Who wants to put a worker through that? I personally do not want to inflict that on workers either.

Brad Battin: Deputy Speaker, I draw your attention to the state of the house.

Quorum formed.