Uranium is the key component in nuclear energy. A third of the world’s uranium is in Australia. Will the country use it?

uranium and nuclear energy, the venture magazineApproximately one third of the world’s uranium is in Australia. The country has more of the element than any other nation, and South Australia’s Olympic Dam is the largest known uranium deposit. The element is the primary factor in generating nuclear power. Despite these vast reserves, Australia is the only country among the 25 largest world economies that does not use nuclear power, which generates 11 per cent of the world’s electricity. Although extraction is limited to just three mines, Australia is the third-leading producer of uranium, exporting all of it. With so much of the element available, why is Australia so hesitant to develop nuclear power? Will that attitude change? VENTURE takes a closer look.

The Pros

Prime Minister Scott Morrison turned heads in April when he said on a Tasmanian radio programme that nuclear energy was “not ‘not’ on the agenda” a few weeks before a federal election, which he eventually won. This excited nuclear proponents since it is banned from the energy mix. Morrison quickly clarified that he did not intend to change the current government stance.

In response, the Minerals Council of Australia released a statement urging the government to reverse the policy. “Removing the ban would allow Australians to have a serious conversation about a genuinely technology-neutral approach towards the nation’s energy mix — delivering affordable, reliable, and clean energy sources,” the statement declares. “The removal of the prohibition on nuclear energy will also allow for investment proposals to be brought forward.”

Nuclear energy is classified as low-carbon and it has a high energy density. According to the US Energy Information Administration, 1 kilogram of enriched uranium can generate enough energy to power more than 100 homes for a year. To heat one home for the same period would require nearly a tonne of crude oil. Whilst solar, wind, and other renewables provide green alternatives to coal, there are times when the sun isn’t shining and the wind isn’t blowing. Batteries store wind and solar energy, of course, but nuclear energy is in constant production as long as there is fuel, and there is plenty of that in Australia. The country’s three active uranium mines — Olympic Dam and Beverley in SA and Ranger in the Northern Territory — produced nearly 7,000 tonnes in 2017. Advocates for nuclear power say it would be a vital addition to the energy mix, reducing emissions and reliance on fossil fuels.

“Nuclear plants are expensive to build but relatively cheap to run,” the World Nuclear Association says. “Once a nuclear plant has been constructed, the production cost of electricity is low and predictably stable.”

The Cons

uranium and nuclear energy, the venture magazineOne downside is that nuclear plants are expensive to build (although they are cheap to run). The high initial costs with low returns discourage investment. Not many companies are keen to spend a lot of money upfront and sit back patiently waiting for the project to become profitable. According to the Climate Council, the average nuclear power station takes more than nine years to build.

Low prices also give miners little incentive to push for more development. Canadian uranium miner Cameco has permission from the government of Western Australia to develop its Yeelirrie site, but with spot prices around $16 per kilogram, the company is taking things slowly. “While we are happy to have this approval in place, current market conditions are challenging and we expect them to remain so in the near term,” Cameco Australia general manager Simon Williamson announced in April.

Unlike wind and solar, the Climate Council argues, nuclear power is not flexible. You can’t adjust the amount of energy the reactor is producing; it’s all or nothing. Plus, there is plenty of wind and sunshine in Australia, enough to render nuclear energy unnecessary. It isn’t just uranium that nuclear power plants require. They need water, and lots of it — about 1,500 litres per megawatt hour of energy — to cool fuel rods.

Of course, the biggest objection to nuclear power plants is the potential for disaster. You’ve heard the names: Three Mile Island, Chernobyl, Fukushima. While incidents such as these are relatively rare, and valuable lessons have been learned that would go a long way to preventing such disasters, the notion of nuclear power conjures up images of destruction in the public mind. As a 2010 study by the Organisation for Economic Co-operation and Development (OECD) put it, “Public opinion on nuclear energy seems to change slowly and is not normally volatile. Not surprisingly however, dramatic events can cause a rapid drop in public support, which only recovers slowly. … The Three Mile Island accident in March 1979 and the much more severe Chernobyl accident in April 1986 had a significant impact on public attitudes to nuclear power.” A year after the study, the Fukushima disaster happened. Nuclear’s reputation is still recovering.

The Future

uranium and nuclear energy, the venture magazineAs things stand, there are approximately 450 nuclear reactors in 30 countries worldwide. Exactly one of those — the Open Pool Australian Lightwater (OPAL) reactor in Lucas Heights, Sydney — is in Australia. In March, three staff at OPAL went to hospital for decontamination after exposure to sodium hydroxide. The International Nuclear Event Scale deemed a 2017 accident in which a dropped vial of radioactive material contaminated an OPAL employee through two pairs of gloves the most serious incident in the world for 2017. Obviously, that is not a title one aspires to hold. Yet, it does say something about the relative safety of nuclear energy.

A Massachusetts Institute of Technology study found that including nuclear and carbon capture and storage in the energy mix could make carbon-free electricity up to 62 per cent cheaper than using renewables alone. Bill Gates helped found TerraPower, which invented a wave reactor to generate energy from depleted uranium, in the US state of Washington. Depleted uranium is a waste byproduct of the enrichment process. “We need governments … to step up and commit new funding for nuclear energy research and demonstrate that there is a future for nuclear energy,” Gates wrote for World Economic Forum.

France is the country that has made the strongest commitment to nuclear power. Three quarters of its energy is nuclear, and it has reduced its carbon emissions by more than 50 per cent since going nuclear in the 1970s. France makes about €3 billion ($4.9 billion) yearly from selling its excess energy. Yet France aims to cut nuclear down to 50 per cent of its energy generation by 2035 and focus on renewables. California was getting as much as 14 per cent of its energy from nuclear power a decade ago but now aims to close its last nuclear plant by 2026, placing more emphasis on wind and solar.

A Royal Commission study into the potential effects of uranium-based nuclear power in SA released in 2016 stated that nuclear “should not be discounted as an energy option on the basis of safety” but that it would not be “commercially viable to develop a nuclear power plant in South Australia beyond 2030.”

So, whilst Australia lays claim to the world’s largest uranium reserves, the time for investing in large-scale nuclear energy has come and gone.