The nuclear option
Source: Unsplash
Nuclear energy still has many doubters, including in Australia, but sentiment may be shifting as the world struggles to wean itself off fossil fuels. by john mcduling.
This piece was first published in Capital Brief
“When it comes to nuclear, the wording is incredibly important. Should we consider nuclear? My answer is yes!” That was Mike-Cannon Brookes in response to a question from Capital Brief about the role nuclear power should play in Australia’s energy mix as we transition to a zero emissions economy.
The comment came from a lengthy interview we ran with arguably the nation’s most prominent clean energy investor.
Cannon-Brookes has previously dismissed nuclear out of hand, and while he still has pretty significant doubts about the practicality of it in Australia, the softening of his stance reflects a shift in thinking towards the controversial energy technology.
This is being driven by concerns about the ability of renewables to completely fill the void left by fossil fuels and the rise of small modular reactors (SMRs), which will theoretically be cheaper and faster to deploy than traditional nuclear power plants. These factors seem to be outweighing long-held concerns about safety of nuclear power and the storage of toxic waste it produces (as best depicted by the three-eyed fish in The Simpsons).
As nuclear advocate Mark Nelson put it on Bloomberg’s Odd Lots podcast last week: “There's a genuine cultural moment where almost anybody I meet wants to have a conversation about nuclear with me”.
Anecdotally, it very much seems that way. A few weeks back, our morning newsletter Letter of Intent ran a LinkedIn poll about whether Australia should develop nuclear power following another interview we ran with Kiwi infrastructure giant Morrison, which was pretty downbeat on the idea. Of the nearly 500 respondents in this admittedly unscientific poll, 75% answered yes.
In September, the World Nuclear Association predicted at its annual symposium that demand for uranium (the key commodity for nuclear power, of which Australia has plenty) would double between now and 2040. Hedge funds have been piling into the sector.
“With over 40 years in this industry, I feel well qualified in saying, yes, we've seen enthusiasm in past cycles,” the CEO of New York and Canada listed Cameco, the world’s largest uranium producer, told investors overnight. “Over at the symposium this year, there was a sense of urgency that I can't say we've experienced before.”
Whether it is actually feasible in Australia remains highly debatable. The cost and time to deploy and lack of industry expertise are serious concerns. But nuclear power is undeniably gaining significant steam offshore, in markets where it might make sense. At the very least, it’s no longer the energy shibboleth it was for so long.