

Divide and fool: The Coalitions misinformation campaign
October 22, 2023
In a recent Q and A, the oppositions shadow minister for Climate Change and Energy Ted OBriens improbable aim was to convince Australia that small nuclear reactors (SMRs) could replace our coal fired power plants and lead us to carbon neutrality. If you examine the economics of SMRs the proposition has to be classified as an absurdity with no chance of becoming a reality in the foreseeable future if ever.
It seems that it is of no concern to OBrien who then continued his Q and A masterclass in misleading semantics and obfuscation. The CSIROs estimated cost of $487 billion for 71 SMRs was, he asserted, with either extraordinary ignorance or dishonesty, based on faulty hypothetical data. The coalition’s own study under way was being based on real data. For those of us who have bothered to learn up on the fact that there are no SMRs operating as an economic entity anywhere in the world (there are two prototypes one in Russian and one in China), OBriens does us a grave injustice. This insult is greatly enlarged by OBriens incapacity to explain how the mythical real data would go anywhere near bridging gap with the comparative capital costs for solar and wind per kw which, according to the CSIROs rigorous study, are between 18 -20 times lower.
This obfuscation of the cost differential is being accompanied by assertions that commercial SMRs are just around the corner. In doing so, both OBrien and Dutton use the shoddy device of slipping into the present tense in referring to SMRs in over 50 countries and to references about how cheaply they are being modularised. What in reality they refer to is nothing of the sort. They are alluding to little more than the current burst of startup hype surrounding SMRs. Its being generated by what the Washington Post describes as the rise of a techno-bro libertarian culture whose adherents valorize new technology, loath regulation and embrace the marketplace. As applied to nuclear power, what is being sold to the market is the allure of solving the carbon crisis in one simple nuclear techno swoop.
No such luck. As a world authority on nuclear power, Allison Mcfarlane (former chairman of the US Nuclear Regulatory Commission) observed recently, this speculative bubble was using compliant media as an echo chamberwith each outlet clambering over the next to crow about the great benefits of nuclear power in misleading language that suggests this technology is already entirely proven out. An apt description of The Australian and the Financial Reviews uncritical lauding of the oppositions SMR policy.
The Q and A debate equally brought to light another no-brainer about SMRs that, even if they were economic - the notoriously long lead time for nuclear reactor development meant they would be of no use to Australia in its battle to meet its target emissions reduction of 35% by 2030 let alone the 90% reduction needed by 2035 to hold global temperatures below 1.5C.
Even if lead times were somehow shortened, deployment at scale would hardly be a bankable proposition to investors. The CSIROs analysis of projected power costs per kwh for 2030 assumes, generously in the case of SMRs, a halving of cost through modularisation. Even so, the cost differential between SMRs and wind and solar renewables at 5 to 6 times remain huge – with solar at $50-55 per kwh, wind $40-60 and SMRs $200 - $350. As Macfarlane goes on to point out: In the nuclear celebratory mood of the moment, there is little patience or political will for sober voices to discuss the reality that new nuclear power is actually many decades away from having any measurable impact on climate change if at all.
If yet another reality check is needed it comes from the state of play of the only new prototype SMR globally with regulatory (US) approval. The NuScale reactor, on paper, has claimed a power generation cost of around US$55 per mwh and which, presumably, the coalition will be using to bolster its claims for SMR viability. If so, there are two insurmountable problems. The quoted cost per mwh include some extraordinarily large green subsidies (imbedded in the US Inflation Reduction Act). Once subtracted for an Australian rollout, they would increase the cost by around 30% per mwh. Secondly, new revised costings reported a months ago push the cost of the MuScale reactor up 50% to US$89 per MWH or around A$140 mwh. To boot, the NuScale reactor is yet to be built or tested nor therefore has its claims for lower costs of modularisation - which are built into their costs per kwh - been verified.
If there are to be any lingering doubts about SMRs viability for Australia then the CSIROs cost comparisons of wind, solar and SMRs is a timely reminder that Australia has some of the worlds lowest cost renewables and that, as scale increases over time, new technology will continue to bring down its capital cost. Closing the gap with SMRs is therefore even further from reality.
The overwhelming case against the adoption of SMRs begs the question why the Coalition has embraced a policy which has no economic justification and no chance of being implemented for decades to come if at all - let alone in the current election cycle time frame. Dutton and OBrien claim they are not climate sceptics and therefore need to be held to account in accepting the scientific data on which their policies are based. So we should accept that they or at least their many publicly paid-for advisers - have done due scientific diligence on the economics of SMRs.
The motivation for wilfully cherry picking data and wrongfully interpreting it therefore needs to be aired. Much of the enthusiasm for SMRs has come from the National Party which remains the repository of the oppositions climate sceptics/neo-sceptics and those who simply dont bother to read the science. In turn, it appears they have taken up the cause on behalf of the Mineral Council of Australia (MCA), whose members have supplanted farmers as the National Partys key constituents. But just why the MCA has so fulsomely backed the uptake of nuclear power may not immediately be obvious, given its energy resource based membership is overwhelming from the gas and coal sectors.
The answer is revealing itself in the emerging criticism of the rollout of renewables both in terms of the slowness, the potential shortage of storage and the recent appearance of community opposition to large scale land/visual intrusions. By posing nuclear as an easily implemented and apparently less disruptive alternative, the Coalition is helping to grow this emerging discomfort with renewables by promising a false alternative. All this fits into the MCA/oppositions underlying aim of keeping oil and coal in play as long as possible.
The insidious part of the SMR policy is its drawing on the Trumpian political playbook: facts dont matter in an age of manipulative social media and compliant print media. What does matter is using policies to create an alternative reality with which to open up cracks in an otherwise consensual landscape. That playbook policy has proven extraordinarily successful for the opposition in its policy on the referendum. As for the SMR policy its a smart device which acts as a proxy war to muddy and divide views on the governments climate change policy and delivers to the Coalition a warm financial embrace from the mining industry. In terms of the Australian public its all about dividing and fooling.

Jeremy Webb
Dr Webb is a former diplomat with postings in Indonesia, South Korea, Paris and New Zealand. In a former career as a journalist he was the economics writer for the Bulletin Magasine and Assistant Editor of Rydges Business Journal. He currently carries out research in the field of environmental economics at the Queensland University of Technology.