Client Update: Across Australia and to Paris – Recent developments in the nuclear fuel cycle
23 December 2015
In brief: Partner Richard Malcolmson (view CV), Senior Associate Emily Gerrard and Associate Emily Johnstone report on recent developments in the Australian nuclear fuel cycle debate, including: the recent shortlisting of potential sites by the Australian Government for a radioactive waste management facility; the conclusion of the uranium export deal between Australia and India; and potential implications for nuclear energy following the 'COP21' climate change negotiations in Paris.
- Shortlist for national radioactive waste facility announced
- Nuclear Fuel Cycle Royal Commission
- Other recent developments
The Australian Government recently released its shortlist of six sites being considered for a national nuclear waste disposal facility.1 The Government has indicated that it will buy appropriate sites at four times their market value, and will offer local communities near the final site $10 million to spend on local projects and infrastructure.2 The shortlist includes three sites in South Australia, at Cortlinye, Pinkawillinie and Barnidoota, one in the Northern Territory at Hale, one in New South Wales at Sally's Flat and one site in Queensland at Oman Ama. The Australian Government is seeking comments from members of the public with rights or interests in the sites, as well as from members of local communities, until May 2016.3
The release of the shortlist has yielded mixed responses. Traditional owners living on Mpwelarre Land Trust land, seven kilometres from the proposed Hale site, and members from the nearby Ltyentye Apurte (Santa Teresa) and Titjikala communities have opposed the Northern Territory proposal during consultation meetings run by the Government throughout December.4 By contrast, councillors from the Shire of Leonora in Western Australia's goldfields have voted to engage a geological consultant to assess suitable waste sites, despite the Australian Government excluding Leonora from its shortlist.5 The Council believes it is 'fair' for a waste site to be located in the area since the region will host a number of uranium mines in the coming years.6
The Commonwealth Minister for Resources, Energy and Northern Australia, Josh Frydenberg, has indicated that the national facility would be limited to the management and storage of domestic waste.7 However, Prime Minister Malcolm Turnbull has described Australian involvement in the global nuclear fuel cycle as a business opportunity 'worth looking at closely'.8
Despite the inclusion of sites on the shortlist from South Australia, the South Australian Premier Jay Weatherill has indicated that South Australia will not agree to host a facility until the South Australian Royal Commission has released its findings next year. However, the Premier has described a nuclear waste disposal facility as a 'potential opportunity' that might exist for the State.9 Mr Weatherill commented that his government is willing to reconsider South Australia's strong opposition to a 1998 Howard government proposal to construct low and high-level nuclear waste facilities in South Australia.10
Existing facilities storing Australia's low-level radioactive waste are reaching capacity.11 Radioactive waste is currently stored at more than 100 sites across Australia which are licensed to store waste on a temporary basis, with most stored at the Lucas Heights reactor in New South Wales and a facility at Woomera in South Australia. In addition, the Australian Nuclear Science and Technology Organisation has recently announced that fuel sent overseas is to be sent back to Australia, with an initial shipment arriving at Port Kembla in New South Wales on 5 December.12 This returned waste will be temporarily stored at Lucas Heights, but according to Minister Josh Frydenberg, more permanent and increased storage capacity is needed.13
South Australia is in the middle of public hearings for its Royal Commission into the Nuclear Fuel Cycle, headed by former South Australian Governor Kevin Scarce. The inquiry is essentially an investigation into opportunities and risks associated with the mining, enrichment, energy generation and storage of nuclear material in South Australia.14
Submissions received by the Royal Commission confirm the broad range of views held about Australia's role in the global nuclear industry. Some submissions have emphasised the significant economic benefits, while others have focused on health concerns, issues associated with nuclear waste sites being located on Aboriginal land and on the inherent risks associated with exporting fuel rods overseas.
A submission made by South Australia's Economic Development Board contends that there is a highly profitable opportunity in waste treatment for South Australia.15 It estimates that the economic benefits from spent fuel custody revenues, and the electricity revenues from new-generation recycling and reactor technology, could range from $15-35 billion.16
The Australian Government's submission also identified an opportunity for market entry into storage, management and disposal of nuclear and radioactive waste, noting Australia's comparatively stable geology which makes it suitable for the underground disposal of long-lived high-activity waste.17 This submission also noted that:
- while the National Electricity Market is unlikely to require new generation capacity before 2023-24, market conditions could change during the time it would take to establish a nuclear power program, and there may be opportunities in the meantime to install off-grid generators;18 and
- early consideration of the ‘relative merits’ of nuclear electricity generation is necessary to inform investment decisions and regulatory arrangements.19
- In other developments, the Australian and Indian prime ministers announced from the sidelines of the recent G20 summit in Turkey that the bilateral uranium export deal (read our earlier Client Update on the bilateral agreement) between the two countries can now commence, following the completion of necessary domestic procedures.20 The India Australia Civil Nuclear Cooperation Agreement was signed in September 2014 after the two countries reached agreement on safeguards to ensure peaceful power generation.21
- Toro Energy's plans to expand its Wiluna Uranium Project with two new deposits have progressed following the release of a Public Environmental Report.22 The project already has two deposits, known as Centipede and Lake Way, which were approved by the Western Australian Environment Protection Authority in 2012. At this stage, the company has not commenced mining at any of its deposits.23 Public consultation on the two new deposits and a proposed haul road is open until February 2016.
- Finally, announcements before and during the recent United Nations Framework Convention on Climate Change COP21 negotiations in Paris signal potential further developments in nuclear energy:
- The Obama Administration recently recognised the importance of nuclear energy in meeting international and domestic greenhouse gas emissions reduction targets. President Obama's announcement confirms commitments to ensure that nuclear energy remains a key part of the United States' clean energy strategy into the future.24
- The Paris Agreement and COP21 decision establish a framework for developing economies to transition to clean energy and to aid technology transfer and capability building. Director General of the World Nuclear Association, Agneta Rising, said that the nuclear industry 'stands ready' to help achieve the goals of the Paris Agreement, which 'should lead to a more positive outlook for nuclear investments'.25
- The World Nuclear Association has asserted that there should be '1000 GWe of nuclear new build by 2050 as part of a balanced low-carbon future energy mix', which will require the adoption of harmonised global nuclear regulation and ongoing investment in new generation nuclear technology.26 Similarly, the Deputy Director General of the International Atomic Energy Agency, Mikhail Chudakov, emphasised the role that the Agency can play in assisting member states to meet their climate mitigation goals in their energy and infrastructure planning, by improving their understanding of nuclear technology and its compatibility with sustainability goals.27
With the South Australian Royal Commission due to report on 6 May 2016 (and due to release initial 'Tentative Findings' on 15 February 2016), there are likely to be further developments in the Australian nuclear energy debate in 2016 and in the medium term. We will continue to monitor developments in both the international and domestic energy discussion over the coming months.
- 'Six voluntary sites shortlisted for National Radioactive Waste Management Facility', media release from Josh Frydenberg MP,13 November 2015, accessed 16 November 2015.
- 'National Radioactive Waste Management Facility Frequently Asked Questions'; the Department of Industry, Innovation and Science, National Radioactive Waste Management Facility Resources webpage, accessed 25 November 2015; 'Six shortlisted sites for Australia's first nuclear waste dump; Government faces battle to convince locals worried over safety', ABC News, 14 November 2015, accessed 18 November 2015.
- Australian Government Department of Industry, Innovation and Science, National Radioactive Waste Management Facility: Proposed Sites page, accessed 16 November 2015.
- 'Nuclear waste dump: Aboriginal traditional owners vow to oppose proposed radioactive facility near Alice Springs', ABC News, 16 December 2015, accessed 20 December 2015; 'Traditional owners have no veto on nuke dump', Alice Springs News Online, 5 December 2015, accessed 20 December 2015.
- 'WA shire wants nuclear waste facility despite Federal Government knockback', ABC News, 17 December 2015, accessed 20 December 2015.
- 'No imported nuclear waste – yet', Press Conference, 13 November 2015 (Minister Josh Frydenberg). The Sydney Morning Herald.
- 'Six areas make shortlist for nuclear waste storage', Australian Financial Review, 13 November 2015, accessed 27 November 2015.
- 'SA Government 'open' to nuclear waste dump proposal despite previous opposition: Weatherill', ABC News, 13 November 2015, accessed 15 November 2015.
- 'Six voluntary sites shortlisted for National Radioactive Waste Management Facility', media release from Josh Frydenberg MP, 13 November 2015, accessed 16 November 2015.
- 'Project to repatriate Australian radioactive waste from France', media release, Australian Nuclear Science and Technology Organisation, 16 October 2015, accessed 16 November 2015; 'First nuclear waste shipment returns to Australia today, as Government searches for permanent dump site', ABC News, 5 December 2015, accessed 22 December 2015.
- 'Six sites shortlisted for Australia's first nuclear waste dump; Government faces battle to convince locals worried over safety', ABC News, 14 November 2015, accessed 27 November 2015.
- South Australian Government Media Release, Premier Jay Weatherill, 8 February 2015, accessed 5 November 2015.
- South Australian Economic Development Board, 3 August 2015, Submission to the South Australian Nuclear Fuel Cycle Royal Commission, p 2, accessed 27 November 2015.
- Ibid p 59.
- Australian Government, 12 August 2015, Submission to the South Australian Nuclear Fuel Cycle Royal Commission, accessed 5 November 2015.
- Ibid p 13.
- 'India-Australia Agreement complete', World Nuclear News, 16 November 2015, accessed 23 December 2015; 'Australia-India and Australia-UAE Nuclear Cooperation Agreements', media release of the Minister for Foreign Affairs, 25 November 2015, accessed 23 December 2015.
- 'Prime Minister Tony Abbott seals deal to allow Australian companies to export uranium to India', ABC News, 6 September 2014, accessed 16 November 2015.
- Toro Energy Limited, November 2015, Wiluna Uranium Project: Extension to the Wiluna Uranium Project, Assessment No. 2002 (CMS14025) Public Environmental Review, accessed 27 November 2015; Toro Energy Limited, 16 November 2015, 'Toro releases Public Environmental Review to expand Wiluna Uranium Project', ASX release accessed 23 November 2015.
- Toro Energy Limited, 20 November 2013, Wiluna Mine Information Page, accessed 27 November 2015.
- 'Fact Sheet: Obama Administration announces actions to ensure that nuclear energy remains a vibrant component of the United States' clean energy strategy', Office of the Press Secretary, The White House, 6 November 2015, accessed 18 November 2015.
- 'Climate conference reaches agreement', World Nuclear News, 14 December 2015, accessed 21 December 2015.
- 'Consider Nuclear as Sustainable Energy: IAEA Deputy Director General at COP21', Lenka Kollar, 7 December 2015, accessed 21 December 2015.
- Richard MalcolmsonPartner, Sector Leader, Mining,
Ph: +61 2 9230 4717
- Chris SchulzConsultant,
Ph: +61 3 9613 8772
- Ben ZillmannPartner,
Ph: +61 7 3334 3538
- Jodi ReinmuthPartner,
Ph: +61 8 9488 3702
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