The Government should debunk the "false paradigm" of low-cost renewables and prepare the groundwork for a domestic nuclear industry, says uranium and coal miner Rio Tinto in its response to the Rudd Government’s energy white paper. 

The cost and complexity of rolling out renewable technologies “is usually significantly underestimated in policy discussions”, the submission by Rio Tinto Australia’s managing director, Stephen Creese, says. 

“Rio Tinto's internal analysis shows that all low emissions technologies are, and will remain, very significantly more expensive than conventional energy technologies, it says. 

“The cost of electricity generated by the lowest cost, low emissions technologies (onshore wind, CCS, nuclear, geothermal) is approximately three times the current Australian wholesale electricity price. 

“Rio Tinto is prepared to share the detail of this analysis with the Australian Government on a confidential basis,” it says. 

“This prevailing false paradigm of low cost, low emissions energy is constantly reinforced by reference to old studies and to new studies that use the same flawed assumptions or methodologies,” it complains. 

Any challenge to these numbers “is strongly resisted” by those who advocate them, it says.

’Work out the real cost’

“The incorporation of these cost projections into the Treasury CPRS modelling set a precedent for all subsequent modelling undertaken by or on behalf of Government entities,” Rio warns. 

“Modelling results showed relatively benign impacts on energy prices, reliability and economic growth. Energy and climate policy built on these results is fundamentally flawed.” 

The company urges the Rudd Government to “undertake its own rigorous, comprehensive and independent analysis of the real cost and practicality of building a low emissions energy system as a function of the emissions reduction target”. 

“This analysis must challenge the current paradigm and build a model from first principles to reliably inform the development of energy and climate policy.”

Lay the groundwork now for nuclear power

Rio Tinto’s submission says Australia “should begin building the capacity required to support and regulate a domestic nuclear power industry” so that it is able to quickly establish nuclear power plants if alternative energy technologies don’t live up to expectations. 

“If Australia is to meet its emissions reduction target of 60% by 2050 and at the same time deliver an energy system which is adequate, reliable and affordable, it is clear that every option must be available.” 

“Rio Tinto notes the Government's policy of not pursuing nuclear energy for Australia at this time, however given the uncertainty over the practicality and affordability of several energy options, it would appear to be sensible and prudent for steps to be taken to build the capability to make a decision on nuclear energy by 2020,” it says. 

“The lead time for nuclear energy, including the process of building the necessary institutional capacity, is long,” warns the company, which has a controlling stakein the Ranger uranium mine in the Northern Territory. 

Australia should begin building institutional capacity to support and regulate a domestic nuclear power industry “so that it is in a position to make an informed decision by 2020 on whether nuclear energy should form part Australia's energy mix”, it says. 

If nuclear energy is determined necessary, then Australia should be in a position to “implement that decision efficiently by 2030”. 

Other organisations that have urged consideration of nuclear power in their submissions include Blake Dawson, ANSTO and the Minerals Council.