The draft GenCost 2024-25 Report published by CSIRO and AEMO shows renewables continue to have the lowest cost range of any new-build electricity generation, and that there is no unique cost advantage in Australia adopting nuclear technology.
Public consultation has opened on the draft GenCost 2024-25 Report, an annual assessment of Australia’s future electricity generation costs used in infrastructure planning.
GenCost is a technology-agnostic and policy-neutral report published by CSIRO and the Australian Energy Market Operator (AEMO). It focuses on cost estimates for new build electricity generation, storage, and hydrogen technologies, providing business leaders and decision makers with updated capital costs and data comparisons for their planning and financing studies.
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The draft report found renewables continue to have the lowest cost range of any new-build electricity generation technology, for the seventh year in a row. It also found inflationary pressures continue to ease but the impact on each technology’s unique raw material inputs and supply chains remains mixed.
It also said capital costs of large-scale solar projects have fallen 8% two years in a row, while big battery costs recorded the largest annual reduction, falling 20%.
Costs increased for onshore wind generation, up 2% but at a reduced rate from an 8% increase last year, reflecting ongoing but moderate increases in equipment and installation costs. Gas turbine costings also increased 11%, reflecting the additional cost of being hydrogen ready which is now an industry standard.
Importantly, the draft report found modelling nuclear’s long operational life factor across all new-build electricity generation technologies presents no unique cost advantage over other technologies.
CSIRO chief energy economist and GenCost lead author Paul Graham said the draft report found no unique cost advantage in nuclear technology.
“Similar cost savings can be achieved with shorter-lived technologies, including renewables, even when accounting for the need to build them twice,” Graham said.
“The lack of an economic advantage is due to the substantial nuclear re-investment costs required to achieve long operational life.”
The draft report found GenCost’s previous analysis of nuclear’s capacity factor range of 53-89% fair and remains unaltered based on verifiable data and consideration of Australia’s unique electricity generation sector.
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It also reported that global median nuclear construction times have increased from six years to 8.2 years over the past five years, placing a development timeframe of between 12-17 years. Based on this analysis, GenCost maintained the total development lead time for nuclear in Australia will be at least 15 years.
The draft GenCost 2024-25 report is open for consultation until 11 February 2025, with the final report to be released in the second quarter of 2025.
