The Smart Energy Council has analysed the impact Peter Dutton’s nuclear plan will have on the millions of Australian solar households and their energy bills.
Based on the Coalition’s plan to force 14 gigawatts of nuclear power into Australia’s grid, the analysis finds that up to 5 million rooftop solar systems will be switched off, and the average power price bill will more than double.
The Smart Energy Council’s full analysis is below, but in short reveals:
- Between 3,217,500 to 5,148,000 rooftop solar systems (up to 12.5 million Australians) will need to be shut off every day to allow nuclear to be shoe-horned into the system.
- Nuclear will knock out solar for an average 67% of the year, resulting in lost energy savings and solar residents being forced on to higher nuclear power prices.
- The combination of lost solar savings ($888) per year, and being forced to pay for nuclear power will be $2,221 per year, up from $1,000.
- Nuclear power will add $665 per year to the average non-solar household, from $2,000 to $2,665.
- Australia’s 4 million solar homes stand to lose $4.8 billion in energy savings with nuclear power in the grid, every single year.
Smart Energy Council Chief Executive John Grimes says the true extent of the impact of nuclear power on Australian solar families has been hidden by the Coalition.
“Nowhere in Peter Dutton’s nuclear costings does he reveal how much his plan will drive up people’s energy bills, and now we know why.”
“This nuclear plan is in reality a SolarStopper policy, that will force millions of Australians to switch off the solar systems they paid for, and instead pay for Peter Dutton’s nuclear reactors.”
Australian solar homes save an average of $1,000 per year off their energy bills. With nuclear switching solar off for 67% of the year, they will not only lose the energy savings from solar, but also be forced to pay for the higher nuclear power prices, more than doubling the average bill to $2,221 (see graph).
*The savings from solar for the current power bill is $1,000.
**The savings from solar with the nuclear power bill is $444.
“Nuclear power means Australia’s 4 million solar homes stand to lose a total of $4.9 billion in energy savings per year,” Mr Grimes said.
“Australia’s energy grid is a Goldilocks grid. You cannot have too much power or too little power at any one time. It has to be just right.”
“If you flood the energy grid with inflexible nuclear power, you have to turn off household solar panels to balance out the grid and 12.5 million Australians won’t be able to slash their power bills with solar as a result.”
“In addition to massively increasing power bills and halving the number of future solar installations, Peter Dutton’s nuclear plan will shut off nearly all solar systems in the country.”
SolarStopper Analysis
Assumptions:
- The Smart Energy Council has used the Coalition’s nuclear plan and commissioned report from Frontier Economics for the following assumptions:
- 13,000 megawatts (MW) of nuclear capacity.
- The two sites for Small Modular Reactors are missing from the Frontier analysis, reducing from a 14,000 MW plan to 13,000 MW.
- This analysis excluded the site in Collie Western Australia, creating a National Energy Market-only analysis.
- A 90% capacity factor, to be in-line with the Frontier report.
- This is just above the highest end of the range used by CSIRO, which is 53% to 89%.
- Nuclear is stated as a ‘baseload’ generation source “which produces electricity more or less continually”.
- 13,000 megawatts (MW) of nuclear capacity.
- We note the assumption that the lives of the current coal power plants in the NEM will be stretched out until nuclear power plants replace them.
- The nuclear power plants are proposed to be on the same sites as the coal-fired power stations.
- This requires a decommissioning and demolition of the coal generators, before a lengthy build period if they are to be located on the same sites.
- Additionally, no appropriate costing was factored-in to the modelling for keeping these coal plants alive longer than they have been proposed by both the Australian Energy Market Operator (AEMO) and the plant owners, especially accounting for significant maintenance and upgrades that will be needed to keep the aging coal powered generation fleet operating.
- Unless the coalition plans to either stop Australian households from installing solar on their houses and saving thousands of dollars per year, or allow a period of blackouts due to lack of generation, we will assume that energy generation build-out will continue until the nuclear power plants are commissioned.
- This will require the shoe-horning of the nuclear power generators into the NEM once they have been commissioned.
- Rooftop solar PV assumptions:
- The standard household solar system is 6.6kilowatt (kW) which produces 30-50 kilowatt hours (kWh) per day in summer and 15-25 kWh per day in winter.
- The average size of new solar installations is close to 10kW.
- For a 6.6kW system, there is an annual average of 25 kWh per day.
- For a 10kW system, there is an annual average of 40 kWh per day.
- The default power bill across the NEM is $2,007 for FY 2023-24 from DCCEEW modelling. This has been rounded to $2,000 for simplicity in calculations.
- The average bill saving from solar ranges across the NEM, with an average of $1,000 for FY 2023-24.
- The current amount of rooftop solar energy in the NEM has reached numerous records in the last few months:
- Maximum instantaneous Victorian rooftop PV share at 67.8% on Saturday 12 October 2024 at 13:00 hrs.
- Maximum instantaneous South Australian rooftop PV share at 112.9% on Saturday 19 October 2024 at 13:15 hrs.
- Maximum instantaneous Queensland rooftop PV share at 51.9% on Sunday 18 August 2024 at 12:40 hrs.
- Maximum instantaneous NEM rooftop PV share at 50.4% on Saturday 12 October 2024 at 13:00 hrs.
- Due to the inflexibility of nuclear generation, when there is excess generation from rooftop solar, it will need to be ramped down, despite the National Electricity Market usually setting the price of generation.
- Noting rooftop solar is the cheapest option by a long way, forcing out more expensive forms of generation such as gas or coal.
- It is assumed that rooftop solar will be shut off during daylight hours to allow for nuclear energy to enter the system without causing blackouts from the excess capacity created.
- This is due to the ease of solar shutdown with the emergence of solar backstop measures, as well as market operators not having to compensate households for solar shutdown.
- Rooftop solar is the immediate victim as larger stations would be able to defend their right to produce power.
Calculations:
Impact of 11.7 gigawatts (GW) (90% of 13 GW) worth of nuclear power being forced onto the NEM.
0:00-7:00 (11.7GW) = 81.9 GWh
7:00-18:00 (11.7GW) = 128.7 GWh
18:00-24:00 (11.7GW) = 70.2 GWh
Over 24hrs: 280.8 GWh produced.
Over 365 days: 102,492 GWh.
The daylight generation from 7:00-18:00 over the year is 46,975.5 GWh.
The 46,975.5 GWh of extra generation during the day when solar is producing will be beyond the required amount, resulting in a ramp-down of rooftop solar as the easiest power source to be reduced.
0.000025 to 0.00004 GWh is produced per house on an average day.
0.009125 to 0.0146 GWh per year from each house.
46,975.5 GWh needs to be displaced.
46,975.5/0.009125 = 5,148,000 to 46,975.5/0.0146 = 3,217,500 houses requiring solar shut-down.
This means almost every solar household will need to have their solar shut-down to allow for nuclear power plants to be added to the system without avoiding blackouts.
If 11.7 GW is added to the grid, this would result in 11.7 GW of generation needing to be curtailed to avoid blackouts during the day when there is surplus energy generated. Rooftop solar is the immediate victim as larger stations would be able to defend their right to produce power.
Cost impacts:
If solar will be shut off 67% of the time for all solar homes, this will significantly impact the savings recovered by these homes that have invested in solar.
The default power bill without solar in FY 2023-24 was around $2000.
The average household with solar saved $1000 per year from their electricity bills during this same time period, with solar cutting bills in half.
The introduction of nuclear power will increase power bills for all households by $665 (as found by IEEFA).
The introduction of nuclear power will also reduce the savings that households get from their solar by 67%.
A household power bill will go from $2,000 to $2,665.
A solar household power bill will go from $1,000 to $2,221.
Nuclear will cost solar homes $1,221 per year.
- There is a difference of $888 due to solar being shut off 67% of the time and households are forced to pay higher prices for this extra power.
- The other $333 comes from a higher electricity price for nuclear for the rest of the $1,000 power bill.
- Solar coverage of only one-sixth of the power bill will account for just $444 in savings per year.
