Chris Bowen warns of 'investment chill' for renewables under nuclear plan
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The news: Energy Minister Chris Bowen will declare that there will be an immediate "investment chill" on the renewable sector if the Coalition is elected because of its policy to build nuclear power plants.
The context: In an address on Wednesday to the National Press Club on "Australia’s energy choice in the critical decade", Bowen will argue that support for renewables would dry up under a Coalition government because domestic and global investors will not try to compete with taxpayer subsidies for nuclear plants.
Opposition leader Peter Dutton and his energy spokesman Ted O'Brien have outlined a plan to build nuclear plants on seven sites in five states if they are elected.
The Labor government, meanwhile, is investing billions of dollars to modernise the energy grid for the transition to renewables, with gas playing a role as coal-fired power plants are retired.
In his speech Bowen will outline three reasons against the Coalition's plan: the incompatibility of nuclear and renewables, the investment impact on renewables by subsidising nuclear reactors and unsuitability of nuclear plants for Australia's energy grid.
What they said: Bowen will argue that in Australia, nuclear and renewables are "simply incompatible" and that Australia can't wait "another 15 or 20 years" for a new form of generation such as nuclear.
He will say that domestic and global investors won't try to compete with "unlimited taxpayer subsidies for state-sponsored generation".
"That investment chill wouldn’t come when the first reactor was delivered, in 2035 or 2037 or more likely the 2040s," Bowen will say, according to a draft of the speech.
"It would come as soon as the Coalition was elected.
"And so Australia would be trading investment certainty and urgently-needed renewable investment for the hope of more costly reactors in two decades time.
"In the context I’ve outlined of ageing and unreliable coal-fired power stations, we can only imagine what that would do for affordability and reliability."
Bowen will also say that nuclear reactors are "not fit-for-purpose" for Australia's energy grid.
"Our grid is already almost 40% renewable. Renewable energy is incredibly cheap because its fuel is free, whether that is sunshine or wind," he will say.
"When the wind is blowing and the sun is shining, we have ample power flowing into the grid at zero marginal cost, which brings down the wholesale cost of power to zero and even delivers negative prices.
"A base load nuclear power plant will need to keep generating even when there are ample renewables, losing money for every watt of energy produced. Baseload nuclear plants simply don’t stack up economically in a grid with significant renewable generation."
The source: Minister for Climate Change and Energy
