At Frontier Economics, we’ve been providing the economic analysis and frameworks to key energy transition decisions in Australia for more than 25 years. As independent economic consultants, we regularly inform ourselves on, and dig deep into, the most important decisions impacting society.
The report below is the first of two reports to help inform the debate about the economics of including nuclear power in the National Electricity Market (NEM).
The work presented in both reports is funded and directed solely by Frontier Economics. Consultation with various government and private sector parties was sought, to ensure we modelled the inclusion of nuclear power in the NEM most accurately.
There is a large amount of ill-informed and misleading cost comparisons being shared about nuclear power in Australia, and Australian’s deserve better analysis and commentary to make the right decisions for our energy future. - Danny Price, Managing Director, Frontier Economics
We expect and welcome robust debate on the work we present in both reports and look forward to continuing the in-depth economic analysis that will bring Australia into a more sustainable energy future.
Report 1: Developing a base case to assess the relative costs of nuclear power in the NEM
The aim of the modelling and analysis presented in this first report is to establish a base case against which we compare, in the second report, the relative costs of including nuclear power in the NEM.
We consider the Australian Energy Market Operator's (AEMO) preferred approach of relying on just three technologies to supply Australia’s energy future as an appropriate base case against which we can compare the economic costs of including nuclear power in the mix of electricity supply options. We consider AEMO’s Step Change scenario is an appropriate base case because this is the plan that is approved and being pursued by NEM jurisdictions.
In summary, the Report Modelling matched AEMO’s modelling for both the Step Change and Progressive scenarios well in all aspects. We conclude from this analysis that the Report Modelling provides a reasonable basis for analysing the effect of including nuclear power into the NEM.
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