Setup costs prove first hurdle for nuclear fuel

TAX uncertainties in the Timor Sea may fuel the case for nuclear energy in Australia.

When Bayu-Undan operator Phillips Petroleum and joint venture partners announced last week a proposed subsea pipeline project delivering Bayu-Undan gas to Darwin had been put on hold indefinitely, plans to deliver much needed gas supplies to three Australian states were placed in jeopardy.

Even before this announcement the Uranium Information Council was saying nuclear energy would first be a necessity for South Australia, and perhaps even Western Australia, should gas prices rise.

Australia has always had an abundant supply of coal, which continues to generate base-load power cheaply and at rates which are currently reducing even further.

Up to 80 per cent of Australia’s electricity is produced from coal and coal-based power generation remains price competitive against more environmentally acceptable natural gas-fired technologies.

But WA and SA are the two states that have less coal than gas. Fifty per cent of WA’s power and 60 per cent of SA’s comes from gas, but prices are undoubtedly on the up.

Origin Energy has jumped in with plans to have a 100 megawatt gas-fired electricity plant up and running on Torrens Island this summer. And, with Australian National Power, it will construct a new gas pipeline from Port Campbell, Victoria, to Adelaide. But this still leaves the needs of northern and mid Australia unanswered.

And Epic Energy’s dream to deliver gas to Moomba, SA, and through offshoot lines to Queensland and New South Wales depends on the Bayu-Undan line and associated processing facilities in Darwin.

Hence the UIC’s argument.

At a recent Perth forum, also before the Bayu-Undan ann-ouncement, a businessman raised the issue with Energy Minister Eric Ripper and a respected stockbroker privately voiced his opinion that nuclear energy was the answer if renew-able sources could not adequately replace fossil fuel use.

UIC general manager Ian Hore-Lacy said while the case for nuclear energy was fundamentally economic and related to the cost of alternatives, raising the initial capital for a plant was a major problem for nuclear energy proponents.

Even though eventual operating costs have been proven worldwide to be low compared with power generation using other fuels, construction of a nuclear-fired plant is capital intensive and takes between four and five years.

In Australia, where none of the country’s electricity is produced from nuclear energy, a nuclear power project could take even longer to come to an operational stage.

Plans to construct a reactor for electricity generation at Jervis Bay, New South Wales were knocked back in 1972, and a planned replacement research reactor at the Lucas Heights facility in Sydney is under intense regulatory, com-munity and political scrutiny.

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