InDaily

Adelaide's independent news

Support

Wealth beyond measure? Scarce commission backs SA nuke 'dump'

News

South Australia is poised to dramatically escalate its involvement in the nuclear fuel cycle, with the Scarce Royal Commission finding a significant business case for a state-based waste dump.

Comments
Comments Print article

The tentative findings of the commission, unveiled this morning, determined that the “storage and disposal of used nuclear fuel in SA would meet a global need and is likely to deliver substantial economic benefits”, including annual revenue to the state of $5.6 billion on average for the first 30 years of operation.

That would equate to “additional revenue of about $3300 per person per year” and is “equivalent to approximately 34 per cent of [the] current state government revenue” of $16 billion a year, the commission found.

It further determined there would be an additional $2.1 billion benefit for each year of the 43 years thereafter, with a high-level storage facility potentially operational “in the late 2020s”.

The key finding of the commission, as forecast by InDaily last week, is set to unleash a concerted public relations campaign by environmental groups, including the Greens.

It’s understood Weatherill Government insiders are prepared to back a case for a nuclear dump, although the administration is unlikely to weigh in strongly until the commission hands down its final report in May.

“This commission is not driven by emotion or opinion,” Commissioner Kevin Scarce told reporters today.

However, he conceded emotions and opinions would be divided by his findings on nuclear storage.

“The debate has been formed upon fear,” he said.

I wish people would stop using the term ‘waste dump’… it has no bearing whatsoever on a dump

“One of the reasons I signed up for this particular job is I thought it was important to have a discussion based on fact, and that’s what I’ve attempted to do.

“At the end of the day, the community decides, not me.”

Under questioning, however, he bristled at the use of the term “waste dump”, saying he “wished people would stop using” it.

“It’s a sophisticated engineering site… it has no bearing whatsoever on a dump,” he said.

The case for nuclear waste storage was overwhelmingly the strongest of the four terms of reference considered, with Scarce finding nuclear electricity generation “would not be commercially viable in the foreseeable future… taking account of future demand and anticipated costs”.

He determined that market characteristics, including flat future demand, a significant number of high demand peaks and SA’s relative isolation from the eastern states, determined the case didn’t stack up under current market rules.

There was similarly no short-term business case for further domestic processing and manufacture, although the commission found “fuel leasing, which links uranium processing with its eventual return for disposal, is more likely to be commercially attractive [and] create additional employment”.

The report found expanding the state’s existing uranium mining assets “has the potential to be economically beneficial… however, it is not the most significant opportunity”.

It’s understood Labor insiders have long seen the commission as a green-light for a contentious waste dump – ironically, considering the Rann Government famously fought to kill off a federal plan to establish a repository at Woomera in 2004.

Greens MLC Mark Parnell, who conceded flyers were being prepared to ratchet up an anti-uranium campaign, last week told InDaily: “It’s all about the dump.”

“Today’s findings take no-one by surprise – we’ve known since last year this process was all about the dump,” he reiterated today.

“What the Greens are calling for is for Premier Weatherill to have the spine his predecessor had, because Mike Rann knew the reputational damage it would cause us was not worth it.”

He insisted the economic case was flawed and “illusory”, because it only analysed the short-term benefits, rather than long-term environmental damage and reputational risk.

If it looks like a dump and serves the purpose of a dump – it’s a dump

“If it looks too good to be true, it probably is,” he said, ignoring Scarce’s distaste for the terminology.

“A dump is a dump is a dump… if it looks like a dump and serves the purpose of a dump – it’s a dump.”

However, the overall tone of the commission’s tentative findings – which will now be subject to a fresh round of public consultation – was overwhelmingly positive in pushing for a greater role for the state in the global nuclear fuel cycle.

“South Australia can safely increase its participation in nuclear activities and, by doing so, significantly improve the economic welfare of the SA community,” the report enthused, while noting that “community consent would be essential to the successful development of any nuclear fuel cycle activities”.

“The management of the social, environmental, safety and financial risks of participation in these activities is not beyond South Australians,” the commission found.

The report also emphasised, as former Governor Scarce told InDaily last year, that the long-term political decisions prompted by his findings would require “bipartisan support at both state and federal levels”.

This would appear to be the biggest challenge for Premier Jay Weatherill, with federal Labor leader Bill Shorten consistently and implacably opposed to any escalation of nuclear-based activities.

Not for the first time of late, Weatherill’s eventual response could see him at loggerheads with powerful elements within his own party.

Scarce had the economic benefits of each point under consideration modeled by independent agencies, which determined the “baseline scenario benefits” of storing waste included total revenue of $257 billion, after costs of $145 billion.

This would include a $32 billion eventual cost for closure and ongoing monitoring.

Scarce outlined a plan for a “State Wealth Fund” of $445 billion, which could grow at “more than $6 billion a year for more than 70 years”.

“To deliver long-term benefits to future generations of South Australians, a special arrangement such as a state wealth fund should be established to accumulate and equitably share the profits from the storage and disposal of waste,” the report argues.

“Such a mechanism would need to be legislatively segregated from consolidated revenue to ensure it delivered continuous benefits over the long term.

“The value of the fund would be substantial… for example, assuming profits accrue at a compound rate of 4 per cent and that 50 per cent of interest income earned each year remains in the fund, it would grow at more than $6 billion a year for more than 70 years [including interest] to reach about $445 billion before notional waste deliveries are planned to cease.”

The commission further argues for the establishment of a separate fund “to finance decommissioning, remediation, closure and long-term monitoring activities”.

There would also be a forecast boom in the state’s investment in scientific research, with the establishment of a research group “focused on the long-term characteristics of used fuel and processes for its management, storage and disposal”.

“It also would be necessary to establish an underground research laboratory that could be integrated into Australia’s existing nuclear research and expertise capability,” the report states.

“It could serve a global client base.”

Scarce found the state’s “unique characteristics” – including stable geology, relatively low levels of seismic activity, stable political and economic structures and a framework for securing long-term agreements with rights-holders – made a “convincing case that we could be part of a long-term solution” for the world’s nuclear storage, although the findings do not earmark a specific site.

He acknowledged “a range of risks”, but also highlighted available measures to manage them, concluding: “That being the case, the opportunity is significant.”

That opportunity would be underpinned by a stipulation that contracts would entail a pre-commitment of 15,500 tonnes of spent fuel, which would not be unloaded until payment has been made.

Scarce also forecast the construction of dedicated infrastructure, including a new port and purpose-built railway.

While acknowledging the need for broad consensus, he noted to reporters: “There’s always the opportunity if we dawdle that someone will take the competitive advantage away from us.”

“If the community decides it wants to do this, we need to get on an do it,” he said.

The commission has cost $5.5 million since it was established last year, but Scarce said that would be “value for money if the community has the opportunity to consider the facts”.

But environmental groups have been quick to respond, with Conservation Council SA’s chief Craig Wilkins saying “any nuclear waste dump needs South Australia’s permission”.

“The issue of genuine acceptance and consent is absolutely critical… if we pursue a nuclear waste dump path, we are saying ‘the best we can do is accept the worst’. I honestly think we can do better than that,” Wilkins said.

 Dr Jim Green from Friends of the Earth denounced the commission’s “optimistic view of potential profits”.

“Costs are likely to be astronomical, even over relatively short timeframes… just to build a repository would cost A$39 billion, according to the latest estimate in France, or A$43 billion according to an estimate from Japan,” Green said. 

Opposition Leader Steven Marshall noted the commission’s emphasis on bipartisan support, saying that was “the only chance of success”.

However, he did not commit to a policy approach until the final report is handed down, saying: “We want to make a decision which is in the best interests of SA.”

“Of course, we have the problem where the federal Labor Party are diametrically opposed to any of these opportunities contained here,” he said.

“There’s no silver bullet in this, but there are opportunities which are identified – and risks which are identified.”

We value local independent journalism. We hope you do too.

InDaily provides valuable, local independent journalism in South Australia. As a news organisation it offers an alternative to The Advertiser, a different voice and a closer look at what is happening in our city and state for free. Any contribution to help fund our work is appreciated. Please click below to become an InDaily supporter.

Powered by PressPatron

Comments

Show comments Hide comments
Will my comment be published? Read the guidelines.

More News stories

Loading next article

Subscribe to InDaily – it’s free!

South Australia’s locally owned, independent source of digital news.

Subscribe now and go in the monthly draw* for your chance to WIN a $100 voucher!

Subscribe free here

*Terms and conditions apply

Welcome back!

Did you know it’s FREE to subscribe?

Subscribe now and go in the monthly draw* for your chance to WIN a $100 voucher!

Subscribe

*Terms and conditions apply