Interview with Sarah Ferguson, ABC 7:30

SARAH FERGUSON: Now, as you can see, I've moved around the desk a bit because we've brought the two Ministers together tonight for a debate about Australia's future.

Chris Bowen is the Minister for Climate Change and Energy. Ted O'Brien is the Shadow Minister. Both of you, you're very welcome to the programme. I'm glad to have you both here.

CHRIS BOWEN: Thanks. Evening Ted.

TED O’BRIEN: Cheers mate.

SARAH FERGUSON: Now that's a great way to start. Now, let's go to GenCost. So, the CSIRO and the Australian Energy Market Operator, as I just mentioned, have crunched the numbers in their latest GenCost report released today. It finds that nuclear energy would still be the most expensive way to deliver low emissions energy to Australia. Do you accept that CSIRO and AEMO have the expertise to make these findings?

TED O'BRIEN: Sarah, I think if you're going to ask that question, I think, I think of what the CSIRO says themselves. I asked them a couple of weeks ago this very question at a hearing of the Parliament. And when it comes to issues relating to nuclear energy, they conceded that they actually don't have the expertise like the likes of the International Atomic Energy Agency, which draws different conclusions from the CSIRO in aspects such as timing.

SARAH FERGUSON: Just to be clear, you're saying the CSIRO told you they do not have the expertise to make the findings in this report?

TED O'BRIEN: Compared to the International Atomic Energy Agency, they conceded that they do not have the same degree of expertise in certain areas, including the timing which features in their report. I think the key thing for the market operator who does the report with the CSIRO is the capital cost because that feeds into their major plan. Now I've only had a quick look because this was published today and I think the capital cost of the modern larger nuclear reactors is probably around about similar to what I've seen elsewhere. That's the key number really that feeds into the operator's plan.

SARAH FERGUSON: And just to be clear, what we're talking about here is solar at 40 to 68 per megawatt hour, to produce wind 65 to 108 and nuclear between $133 and $222. Let me just hand this over to Chris Bowen. So, I asked there whether or not CSIRO has the expertise. I know that you think CSIRO do, CSIRO does? What is your response to GenCost today and that finding on nuclear?

CHRIS BOWEN: Well, my response, Sarah, is that I don't believe I know better than the CSIRO, Australia's premier scientific agency and AEMO who runs our grid. Ted thinks he does know better. That's the key difference between us, and I don't agree that the CSIRO is not qualified. They are one of the world's most respected scientific organisations and you know, when they brought their report out last year, Ted, as is perfect, right, went to them and said I think you've got it wrong about how long nuclear reactors last and how often they're used, their capacity factor. And the CSIRO and AEMO to their credit, have listened to Ted run the numbers on his suggestions and found that his criticisms have no basis in evidence and it doesn't change the costs. So, with respect, Ted has no grounds for complaint. He's raised concerns. The CSIRO and I was very disappointed today to see Peter Dutton suggest some form of political interference that's deeply offensive. Not to me, he can say what he likes about me, but to the CSIRO. I'm deeply offended that the opposition would accuse them of being subject to political interference when they have for the best part of 100 years been completely independent of any politician of any political interference. They've brought this report out at complete arm's length from government and its findings are just inarguable.

SARAH FERGUSON: Well, let's come to that because I'm sure Ted O'Brien thinks they are arguable. Obviously, we're waiting for your long awaited costings within days. How much will they differ from the CSIRO and AEMO estimates, that is at nuclear between 133 and 222.

TED O'BRIEN: So, there's two parts to this, Sarah. Firstly, there is the capital cost - I've already addressed that. Secondly, then what you've just mentioned there is the levelised cost of energy is the methodology they use. Again, if you listen to what the CSIRO says, I mean Chris can have his view and he can talk about other people's views. Listen to the CSIRO themselves. One, they've conceded they're not the experts in this field but secondly, the report today actually says that it is no substitute for an electricity system model. So, what hits your bill at home, what hits your bill at your business is actually a reflection of the total system cost. CSIRO says today –

SARAH FERGUSON: Now I'm going to pause, I'm going to pause you there, Ted O’Brien.

TED O'BRIEN: CSIRO says that it's actually not what they do. That's our focus.

SARAH FERGUSON: We have an audience and we need to bear in mind that it's a complex topic.

TED O'BRIEN: Of course.

SARAH FERGUSON: Not the three of us in the green room, although we can do that later. My question to you was we're expecting your costings. How much will they differ from CSIRO and AEMO costings? What will be more cost per kilowatt hour?

TED O'BRIEN: So, let me answer. So, you'll see the modelling over the next week from the Coalition and the capital costs of the CSIRO, I'm saying, is reasonable. Okay, but what you won't see –

SARAH FERGUSON: And that's the cost to build nuclear reactors?

TED O'BRIEN: Next of a kind, the modern larger plants. What is different from the CSIRO is as they themselves say, they do not model the total system cost. Our focus as a Coalition is on getting prices down. You must calculate the total system cost because that's what hits your bill at home. And for everyone who is at home, Chris can say all he likes, I can say all I like, but they can't deny their own lived experience.

Power bills now in Australia, among the highest in the world. Labor promised a $275 reduction of power bills, but households are now paying up to $1,000 more than what Labor had promised. So, we can talk about alternate plans, but the one thing that I'd like to talk about tonight more than anything is the current electricity system that Chris Bowen is overseeing.

SARAH FERGUSON: We'll get to that in a moment. But let me just come back to you, Chris, on a different point because Ted O'Brien is right that there are multiple countries in the world that have nuclear in their system that rely on nuclear energy. There is a vast amount of research and development going into small modular reactors, not proven, but happening. Given that, why not lift the moratorium now so that if that technology becomes competitive in Australia, we're ready to take advantage of it?

CHRIS BOWEN: Well, let's look at the international experience, Sarah. At the moment, renewable investment dwarfs nuclear investment by 27 times. So, the world is investing 27 times more in solar and wind and renewables than in nuclear. We're adding more solar and wind capacity every couple of weeks than is added in nuclear capacity all year. So, the direction of travel around the world is very, very clear.

And also, when you look at international experience, there's no nuclear reactors under construction in the United States. The one that was closest, which Ted's talked about a lot, NuScale, was cancelled last year because of a 70 percent cost blowout. There is one in the United Kingdom, Hinkley C, which is running about 12 years late and is costing $92 billion Australian. 92 billion. Now, I don't believe that Australia should go down that road. I believe in an Australian energy system for Australian circumstances designed by Australian experts.

SARAH FERGUSON: Let me just come back to the question I asked you because most experts we consult will say that the optimal for Australia, the optimal, is a mix of all technologies. So, why not put Australia in a position where they can exploit advantage in nuclear when they come?

CHRIS BOWEN: We'll have solar, we'll have wind, we'll have hydro backed by gas peaking and firming under our model. But this idea that SMRs will come forward. Look –

SARAH FERGUSON: These are small modular reactors?

CHRIS BOWEN: Small modular reactors, they're the next big thing. They always have been and they always will be. Now what Ted's proposal is not just lifting the moratorium. He's proposing – sure, to lift the moratorium and then to spend hundreds of billions of dollars of taxpayers money on this because he knows the private sector investment won't be there. That's the Liberal Party's policy.

SARAH FERGUSON: Ted O'Brien, would you like to respond to that?

TED O'BRIEN: I would. I was interested to hear Chris talk about figures out of the UK. Dollar figures.

SARAH FERGUSON: Can you just stay with the big figure that Chris spelled? What was the big figure?

TED O'BRIEN: 60 or 90?

CHRIS BOWEN: Hinckley C. 92 billion.

TED O'BRIEN: 92 billion. So, Chris just started tonight's debate saying he doesn't know better than the CSIRO. But his next response is he's now using different figures from the CSIRO. Completely different.

CHRIS BOWEN: The United Kingdom. Australia is not the United Kingdom.

TED O'BRIEN: And so, I respectfully think the Minister needs to make up his mind. Either he backs the capital costs of the CSIRO, or he doesn't. And here he is chairing –

CHRIS BOWEN: Let's go to that.

TED O'BRIEN: And I also note, he didn't actually answer your question, which is if you're so confident, Minister, that nuclear energy will not work in Australia, why don't you agree to lift the moratorium? Stop making it illegal.

CHRIS BOWEN: Well, that's not your proposal and that would, as we've discussed before, but it's –

TED O'BRIEN: But it's a question Sarah has put to you and I put to you too.

SARAH FERGUSON: Just let the Minister finish.

CHRIS BOWEN: Hang on, hang on. And Sarah asked the questions, not you and I'm answering Sarah's question because we are going down the road of the best mix for Australia as designed by the experts. And it would be a massive distraction. We need to send the message to the world that we are open for renewable investment and storage and firming and transmission.

SARAH FERGUSON: You don't think that the investors of the world can make a determination themselves where to put their business?

CHRIS BOWEN: Well, clearly Ted doesn't either because he is not proposing any private sector investment in renewal – in nuclear, excuse me.

TED O'BRIEN: I'll speak for myself. So, why don't you speak for you.

CHRIS BOWEN: He's proposing hundreds of billions of dollars. You can tell me if I'm misrepresenting the Liberal Party's plans.

SARAH FERGUSON: Hundreds of billions of dollars –

CHRIS BOWEN: Tax payers money.

SARAH FERGUSON: I think it's the number – the number that has been put at over 600 billion. Is that going to be different from the number that you produce when your costings come out this week?

TED O'BRIEN: So, over $600 billion is the real cost of Chris's plan, Labor's plan to get to 2050. Is that the one you're talking about?

SARAH FERGUSON: I'm talking about the cost of introducing nuclear energy into the Australian energy mix, which has been costed at about somewhere north of $600 billion. When your costs come out, will they show something different?

TED O'BRIEN: So, Sarah, to be clear, if you're talking about the cost of our nuclear program being over $600 billion, again we've just talked about the CSIRO, but I have to make this point because you mentioned the figure 600 billion, right? So, the CSIRO talks about on a kilowatt basis, around about $9,000 a kilowatt. Once you start talking about 600 billion, you're talking about 55,000 kilowatts. So, again, which figures is the ABC focused on? Are you agreeing with CSIRO or are you, are you tripling?

SARAH FERGUSON: I'm asking you whether the cost of your energy plan will be north of $600 billion or not? And you must know the number now because you've done the work.

TED O'BRIEN: So, what I can tell you, because we're not releasing our economics tonight, but we will be over the next week, is that the plan under Labor will cost 640 billion.

SARAH FERGUSON: The plan under the Coalition?

TED O'BRIEN: $640 billion for just the NEM on the east coast for storage, transmission and generation. And I can assure you that our balanced energy mix, which includes zero emissions, nuclear energy, will come in cheaper.

SARAH FERGUSON: Let me ask you this, are you still planning to place a reactor or multiple reactors at the seven sites you identified earlier this year?

TED O'BRIEN: We made very clear that there are only seven locations we're looking at. We've also made clear that the way you get costs down is to have multi –

SARAH FERGUSON: Yes, so are those seven sites still the sites?

TED O'BRIEN: None of that has changed. None of that has changed.

SARAH FERGUSON: Now I want to also to talk about timelines because it's one of the other important elements of today's report.

So, they've analysed the data on timeframes internationally of how long it takes to build large scale reactors. So, again, we're not talking about the small ones. According to them, build times have got longer, they've grown out, they've not blown out, they've extended to within 12 to 17 years is their assessment. How are you as the Coalition going to meet your emissions targets and bring down costs with timetables like that?

TED O'BRIEN: So, again, as I said before, Sarah, the CSIRO themselves have told me, and it's all on record that they don't believe they know more than the International Atomic Energy Agency on things like the timing. And our plan actually aligns with the IAEA's own schedule on construction. It also aligns with the Albanese Government's advisors on nuclear technology.

SARAH FERGUSON: I think, Chris Bowen, you're going to want to come in on that figure because timeline is obviously crucial when it comes to.

CHRIS BOWEN: Again, look, two quick points, Sarah. I'm disappointed to hear Ted diminish the expertise of the CSIRO this evening. But my point is this –

TED O'BRIEN: I'm sorry but I didn't. I quoted the CSIRO.

SARAH FERGUSON: Let's just – let's just stay with it.

CHRIS BOWEN: I agree with the CSIRO, you don't. That's the difference.

SARAH FERGUSON: I want to stay on this topic of timelines.

CHRIS BOWEN: On the topic of timelines, I think Ted's plan is too ambitious timewise. I don't think he has any chance of achieving it. But my broader point is this. Ted and I would probably agree the energy system needs reform today that we had over the period of the opposition, of the Liberal Government, 4 gigawatts leave the grid and only 1 gigawatt come on of dispatchable energy. And that needed urgent reform. My point is we need more energy now. Even if Ted could achieve his timeline, which I don't believe he can, it's too slow. Ted looks at the energy system now and says “It needs desperate reform and I'll be back to you in 2037.” I don't think that's good enough.

Our plan has added more renewable energy this year than any other year in Australian history. We are seeing more investment in the last quarter than the last year – the year before. So, this plan is actually bringing on the energy that Australians desperately need now to bring prices down because I think we would agree more energy, more supply, it means lower prices. And to bring emissions down because it's renewable, low emissions, we've got to keep going now. We don't have the opportunity or the luxury of saying, well, let's pause until 2037, when under Ted's own timeline, one power station would come on, not all of them, not all seven, one, which would be a tiny proportion of our energy needs off into the late 2030s.

SARAH FERGUSON: Ted O'Brien, how does your energy mix bring down prices, make up for closing old power stations with that timetable?

TED O'BRIEN: So, to be clear, Chris's summary of the Coalition's plan is completely wrong.

SARAH FERGUSON: Because?

TED O'BRIEN: Because Chris likes to frame this as if the Coalition is saying it's nuclear or renewables. This is not a question of or for us, it's a question of and, we will be continuing to roll out renewables.

SARAH FERGUSON: So, give us a sense of how much because obviously an energy mix only works if we know what kind of quantity of renewable energy and nuclear energy will be in the mix. So, how much will be in your renewable energy?

TED O'BRIEN: Let me just finish. So one, we'll be continuing to roll out renewables. Two, we will be pouring more gas into the market because it plays such an important role with prices we must get those prices down. And three, as coal retires from the system, we believe it should be replaced with a 24/7 always on form of baseload power. It's not coal, it's got to be nuclear. That's been the lesson from around the world. Now when it comes to energy mix –

SARAH FERGUSON: So, you're still, you're still not prepared? Yes. Okay. Thank you.

TED O'BRIEN: When it comes to energy mix, the energy mix, come let's say 2050 will be released together with our economics. Those two things go together, which has been what I've seen.

SARAH FERGUSON: But you must have some idea now what kind of proportions they will be.

TED O'BRIEN: Yes, I do. And as much as this is a wonderful show, Sarah, I won't be making the announcement tonight, but you will get the energy mix and you will get the economics within the next week.

Remembering Chris's plan, he told you previously on this show that it's going to cost $121 billion. We now know only two weeks ago the real cost of his plan is well over 640 billion. Five times more expensive.

SARAH FERGUSON: Let's not go down that path because I want.

CHRIS BOWEN: That's not true.

TED O'BRIEN: What is it, Chris? What is the real cost?

SARAH FERGUSON: Let's not get it – let's not get into that because we're going to lose the audience -

CHRIS BOWEN: Sarah's running the debate, Ted.

SARAH FERGUSON: Thanks, Ted.

So, let's go to this. So, at the same time you face problems with your renewable rollout notwithstanding. Seven and a half, seven and a half gigawatts this year and an average of six over the preceding couple of years. But AEMO says you need to put in an extra 120 by 2037. I think that's correct. So, if you're going to replace coal fired power generators, what's your plan to make up the shortfall?

CHRIS BOWEN: Well, our plan is to keep going with a few things. Obviously, the strong rollout of solar and wind which is happening as I said, more renewables connected this year than any other year in Australia in history and that's, there's others coming forward like Snowy 2.0, started by the previous government, kept going by us, which is not – which is a couple of years away yet, but will be an important addition also to add to the storage. I mean, people say – some people say “The sun doesn't always shine and the wind doesn't always blow”. Well, the rain doesn't always fall either. We drink water every day because we store water. We need to store the renewable energy. And our focus there is batteries. Peter Dutton says they can't do the job. They don't exist he says. Well, they do and they're playing an increasingly important role, so we'll continue to roll those out. And importantly, Ted and I would agree, and some of our viewers wouldn't, but we would agree there's an important role for gas in the system for years to come. The difference is I see that role of supporting renewables as being flexible to come on when necessary. You can turn a gas fired power station on and off at no notice. That's not the case with coal and nuclear, whereas Ted thinks gas replaces renewables.

SARAH FERGUSON: At the same time, your side of politics hasn't resolved the issue on the east coast of Australia. Now, unfortunately, such is the nature of the world and some of the events in Australia over the weekend, that leaves us short of time, which guarantees that you two have to come back because we've got a long way to go on gas.

TED O'BRIEN: We also have debates in regional Australia.

SARAH FERGUSON: Thank you very much. And then we can see where we're up to with small modular reactors and whether they have a future anywhere in the world. But in the meantime, I thank you both very much indeed.

TED O'BRIEN: Thank you, Sarah.

CHRIS BOWEN: Great pleasure, Sarah.