Levelised Costs Of Energy: are we comparing apples with durians?

The CSIRO recently published a report arguing that, all-up, nuclear power is roughly 50% more expensive than the cost of renewable energy power plus battery back-up.

It said it's used Levelised Costs of Energy (LCOE) as the metric for cost comparisons between different sources of energy.

It's important to ensure any energy cost comparisons are 'apples versus apples', not 'apples versus durians'.

How?

First, ensure energy generation and storage equipment are costed over the same asset lives.

Second, ensure total power supplied over that asset life is the same for all energy sources.

Third, ensure that the amount of power supplied is consistent with current reliability standards.

Fourth, at the very least, ensure average supply intermittency is fully allowed for over asset life.

Fifth, use LCOE measures that include all generation, battery storage, and transmission costs.

The resultant LCOE measure is a ratio, comprising a numerator and a denominator.

Using nuclear, the denominator is reliable power supply over 80 years (or more).

The numerator includes all current and capital costs for generation, storage and transmission over 80 years.

That's an 'apples versus apples' comparison cost for the same amount of power over 80 years.

Allowing for renewables intermittency, solar generation capacity must be at least 20 times nuclear power plant capacity over 80 years. Wind generation capacity must be at least 13.3 times nuclear power plant capacity. Battery storage (renewables-only scenario) must be able to store and dispatch most of the power generated (for the NEM, via more than 8,000 – 16,000 Tesla Hornsdale 'big batteries') over 80 years.

Is nuclear really more expensive? On an 'apples versus apples' basis, no. Allowing for power generation, battery storage, and new renewables transmission costs, it's cheaper. This matters.

The share of renewables power is rising. But renewables investments aren't rising fast enough to match gas and coal power closures. Energy costs continue to rise. Reliability concerns grow.

Power bills prove costs are soaring. AEMO has recently drawn attention to reliability concerns. Labor governments are 'walking back' on when gas and coal sources should be closed down, including after 2050. So much for pious promises about when a 100% renewables power supply, and zero net emissions, will be achieved.

What to do? Remember The First Law of Holes:

If you find yourself in a hole, stop digging.