The Australia Institute has, once again, taken aim at the plan prepared by the Office of Senator Sean Edwards with a 26-page “report”.
There is no coincidence in the timing, just five days before the release of preliminary findings of the South Australian Nuclear Fuel Cycle Royal Commission. It’s pleasing to note that The Australia Institute regards that plan as the most prominent contribution to that process. It is evidently so compelling as to have warranted the effort of this attack.
It is astonishing to note that their attack, funded by none other than the Conservation Council of South Australia, seeks to undermine a plan based on recycling, waste reduction, large-scale clean energy production and minimisation of mining for energy. Our extensively researched, fully referenced, peer-reviewed document offers a solution to a spent fuel problem that environmental groups continuously complain about. It offers a pathway to the elimination of coal generation. It goes to core of environmental values of reduce, reuse and recycle, and lightening our footprint on the planet. It seems the Conservation Council of South Australia would rather undergo a self-inflicted amputation of core values than take a level-headed look at an innovative proposal using nuclear technology.
The plan has garnered praise and recognition both nationally and internationally as an innovative concept that has understood and capitalised on the complexity of the international nuclear industry: economically, technologically and politically.
The response from The Australia Institute is, by contrast, simplistic, shallow and misguided. In many respects it seeks to deliberately mislead, misrepresent and misdirect. It demonstrates a paucity of knowledge of the industry it seeks to critique. For example, I don’t understand why the lead image is a man standing on barrels of what can only be low-level radioactive waste; gloves, aprons, booties, syringes and the like. Are they proposing to chop that stuff up and incinerate it for energy or something? Surely an image of above ground stored nuclear fuel would have been more relevant? Perhaps the problem there is that it doesn’t actually look very scary.
I await with interest the initial findings of the Nuclear Fuel Cycle Royal Commission. In the meantime I offer these brief responses to The Australia Institute.
This plan is a comprehensive starting point
As stated in our plan (pg 31), we recommend a comprehensive review of this concept with the full access and resources afforded by Government. There are indeed gaps that must be addressed; fully costed transportation based on specific local conditions is one of them. That will require further assessment with adequate resourcing. What we have demonstrated with this plan is that such consideration is absolutely worth it. It is the most comprehensive stand-alone consideration of these issues available, globally, today.
Benefits of this scale do not come without uncertainty.
This plan is not easy to do and it is potentially hugely rewarding. Of course there are challenges, as we acknowledged (page vi)
Benefits of the scale outlined in this submission are not available via well-trodden paths. The business model is novel. Commercialisation is required. Partnerships are needed.
South Australians deserve the opportunity to make bold, calculated decisions based on the findings of the Royal Commission.
This industry is complex and demands specialised attention. The Australia Institute lacks insight into the industry about which it speaks
In developing this plan we took the time to consult, understand and test ideas with experts and potential customers of this service. We shared the development of the plan among a suitably qualified and experienced team of researchers, authors and reviewers. The concept is robust. We look forward to the response of the Royal Commission.
The Australia Institute by contrast makes a simplistic, generalised argument throughout that can be summarised thus: “If this is possible, why won’t others do it?”.
The fact that they have only a question and not an answer demonstrates a lack of insight and understanding about this industry. Presuming, as The Australia Institute has, that this is wholly or even mostly an economic issue is misguided.
“Imagine a third country which has a comparable industrial base to Australia and some stable geology suitable for deep borehole interment. This nation sees Australia’s plan… and investigates how it can get some windfall profit for itself. It reads the Edwards plan, and realises that Australia owns none of the technology used and has no unique competitive advantage. It builds its own PRISMs, its own reprocessing facilities and its own boreholes. It offers to take waste at a mere 200 %. ”. (page 14)
We can scarcely imagine a more ill-informed, simplistic vision and scenario of how the tightly-regulated global nuclear industry operates.
Furthermore The Australia Institute previously spends five pages (8-12) expounding the apparent challenges of this proposal, concluding with this statement:
“This is part of the tremendous difficulty in developing a long-term plan for waste storage. It is one reason countries with spent nuclear fuel might be willing to pay Australia to take it in the first place”. (page 12).
This stands in opposition to the ambitions of the unnamed “third country”. It is clear The Australia Institute wants the argument in whichever direction assists in undermining the concept, whether it makes sense or not.
The market is real. The Australian Institute lacks insight into the market
Our mid-case scenarios suggests storage of 60,000 tonnes of material. We have verified that this market exists right now and for several potential customers there is a measure of urgency in finding a solution. Accessing the market by providing the storage capability is what we do first. It will not be “at our own… great expense” as claimed (pg. 16). These are the contracted revenues that underpin the subsequent investments. This is abundantly clear from our plan.
That known market is from an existing global inventory of about 270,000 tonnes. That is increasing by about 12,000 tonnes per year; the rate of increase is accelerating as nuclear power grows. By 2040 there will be around 700,000 tons of material globally. We modelled the inventories of four nations in Asia and found around 200,000 tons of material by 2050 (Appendix 1 of the plan).
The Australia Institute suggests that we will do ourselves out of a market. They say:
“If it works, our customer base and commodity price dries up, killed by the very technologies we would have piloted at our own risk and at great expense…it only works if no one else does it. It is a Catch-22. If the plan is a technological success it will open up competition, which would make it an economic failure”
This statement if profoundly lacking in insight.
We hope other nations will subsequently come to deploy the solutions we commercialise here in South Australia to manage the remaining 640,000 tonnes of material, globally, in coming decades. This will be good for the world and great for our economy. We will be able to leverage our acquired reactor manufacturing capabilities, our acquired fuel recycling and manufacturing capabilities, and our acquired expertise in borehole technology.
We will plan for our future. Only The Australia Institute foresees a situation where all money is spent and we end up broke
Our plan presents the results of a bounded, net-present value assessment which, in accordance with standard practice, is run over 30-years (in some scenarios we extended to 50 years). We recommended state-wide economic analysis (pg. 31 of the plan) to capture the full range of economic costs and benefits to the state. It should be perfectly evident that plans, policies and economies will continue to evolve and develop both through and beyond the periods considered in our plan.
The Australia Institute infers that our plan involves a) making a great deal of money b) spending it c) leaving ourselves broke with nothing for the long-term. It seems to think South Australia will behave like an ill-disciplined lottery winner. This is simplistic on the basis of both probable policy decisions and the actual nature of economic activity. It ignores the temporal nature of the flow of costs and benefits, where our plan front-loads benefits and spread costs into the future, allowing for investment in further growth and escrow-type funding for future needs. It ignores that the advent of low-cost electricity will itself spur economic growth. It ignores the directly associated industrial development that can spur export. It presumes there will be no plan for the future. This is overlay and inference from The Australia Institute.
We can pursue this as an opportunity. The Australia Institute sees only a problem
What the plan demonstrated is that South Australia may be able to acquire an inventory of fuel material that can:
- Be stored at low-cost
- Progressively recycled
- Deployed in future for the creation of zero-carbon electricity for South Australia and Australia
- Converted into fuel for export
Essentially we will have funded the industrial foundation for low-cost, clean energy for the very long term, without even needing to mine for fuel. What we can see with confidence is that with net-present value of $18 billion-$28 billion plus the economic growth from clean, low cost reliable electricity for around 20 years, South Australia will be more than adequately capitalised to put long-term financial strategies in place.
The plan proposed a pathway for 4,000 tons of material. This is what will be managed in the economic assessment period of 30-50 years assuming no expansion of recycling. Regarding the balance of material The Australia Institute says:
“There is no long-term solution costed or even mentioned in Edward’s plan. It is never discussed again”. (pg. 5)
This is a reasonable question. We were pleased to make responses to the Royal Commission in follow-up enquiries on these matters.
Once the storage facility is established the costs of storage are so low that the impact of including these costs in a net-present value assessment would have been negligible. Even the first round of cask storage is reasonably expected to have a life-time of over a century before requiring replacement.
At end of life of the PRISM plants, further plants will be required. This is an entirely normal process of renewal in generating assets in an industrial economy. Future plants may be built on the basis of costs at the time and revenues from electricity sales. This is normal. Inclusion of these costs and revenues, so far in future, would have been subject to both considerable uncertainty and sufficient discounting as to make their inclusion in a net-present value assessment of negligible impact. All this means the final decision will need to be based on more than our net-present value assessment alone. We would expect nothing less.
Citing anti-nuclear sentiment is self-serving and cynical
The Australia Institute issues this caution:
“Australia has historically had a great deal of hostility toward the nuclear industry”. (pg. 17)
This is self-serving and cynical in the extreme. Few think tanks have such an established record of bias against nuclear technology as The Australia Institute. Their own work in this case is funded by the body that has taken the most prominent role in opposing expansion in the nuclear fuel cycle in the course of the Royal Commission, the Conservation Council of South Australia. Both organisations expend time and resources fomenting and maintaining opposition to nuclear technologies, only to then leverage this opposition as an independent argument in itself. South Australians deserve so much better than this. We believe most stand ready to break this self-defeating cycle.