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Ottawa Pours $970M into Ontario Small Modular Reactor

October 26, 2022
Reading time: 4 minutes
Primary Author: Compiled by Mitchell Beer @mitchellbeer

Darlington Nuclear Generating Station by Óðinn/wikimedia commons

Darlington Nuclear Generating Station by Óðinn/wikimedia commons

The Canada Infrastructure Bank (CIB) is pouring nearly C$970 million into Ontario Power Generation’s plan to build the country’s first small modular nuclear reactor (SMR), a 300-megawatt unit on the site of the existing Darlington nuclear station off Lake Ontario.

In a release, the bank touts the announcement Tuesday as “CIB’s largest investment in clean power to date.”

“It’s a major milestone for us,” CEO Ehren Cory told the Toronto Star.

The CIB describes SMRs as a “new class of nuclear reactors” that are smaller than past designs, at a maximum of about 300 MW, with “a smaller footprint and a shorter construction schedule” than standard nuclear plants. The funding is meant to support the first phase of OPG’s project, including project design, site preparation, initial equipment procurement, utility connections, digital strategy, and project management.

CIB says the investment will “spearhead similar projects” in Alberta, New Brunswick, and Saskatchewan and avoid about 740,000 tonnes of carbon pollution per year once it goes online. “SMRs can provide zero-carbon baseload power across all regions and are crucial to decarbonizing the electricity sector and broader economy,” the release adds.

In a pre-emptive action alert Monday, the Ontario Clean Air Alliance warned that there is “a lot of spin around unproven, untested new nuclear technology,” citing the high cost of nuclear technology, the availability of cheaper, renewable options for baseload power, a history of “long delays and huge cost overruns” on nuclear construction projects, and the lack of any working design for an SMR—all while countries are on a seven-year deadline to reduce global greenhouse gas emissions by 45%.

OCAA says independent analysis puts the cost of proven nuclear reactor designs at 13.1 to 20.4 cents per kilowatt-hour, compared to 2.6 to 5¢ for onshore wind and 2.8 to 4.1¢ for utility-scale solar. And “by integrating our wind and solar generation with Hydro Quebec’s reservoirs (which can act like a battery), we can convert our intermittent wind and solar energy into a firm 24/7 source of baseload electricity for Ontario.”

The provincial government of Premier Doug Ford recently announced it was pulling out of a seven-year electricity trade deal with its neighbouring province.

OCAA adds that the reactor OPG hopes to install at Darlington “is an American-Japanese design with no working prototype. It will be custom built from the ground up,” and “has not been approved for use in Canada or the United States.”

Earlier this month, the 2022 edition of the annual World Nuclear Industry Status Report warned that SMRs are years, possibly decades away from widespread operational use and will make no meaningful contribution to slowing climate change. In 2020, lead author Mycle Schneider said SMR proponents were “actually selling PowerPoint reactors, not detailed engineering,” as the nuclear industry continued to lose ground to cheaper renewables and energy efficiency.

“They’ve been doing this for decades,” Schneider added. “Nobody, not even industry, pretends they can produce anything before 2030. That’s the earliest.”

Toronto Star economics columnist Heather Scoffield says the Darlington deal is “the latest sign that Canada’s climate change commitment to net-zero emissions by 2050 will have to be a voyage full of political compromise and big bucks that come not just from government but from the private sector.” She casts it as an important milestone for an embattled CIB that has been so slow to invest its $35 billion in federal contributions that some elected officials want it shut down.

“With Tuesday’s announcement, the bank will have placed about $9 billion of its capital, leveraging about the same amount in private sector capital, and the same amount in government funding from other sources,” Scoffield writes. OPG will have to pay back its CIB contribution and bring on private investors, she adds, but the federal support still brings more legitimacy and less risk to the first-of-its-kind project.

“Critics of the Darlington plan say small modular reactors are unproven, produce expensive energy, and rely on substandard disposal of nuclear waste. They also say there are far better options, if Ontario were to look harder at Quebec’s hydroelectricity,” Scoffield writes. “With demand for clean electricity set to soar, we’ll need all of the above—and a lot more than a billion dollars from a federal agency to get us through.”

But the OCAA release differs from that budget-busting conclusion, citing an April, 2022 analysis piece by energy transition pioneer Amory Lovins, co-founder of the Colorado-based Rocky Mountain Institute.

“The more urgent climate change is, the more we must invest judiciously, not indiscriminately, to buy cheap, fast, sure options instead of costly, slow, speculative ones,” he wrote. “Only this strategy saves the most carbon per dollar per year. Anything else worsens climate change.”

Meanwhile, the Coalition for Responsible Energy Development in New Brunswick is praising the Impact Assessment Agency of Canada for considering its formal request for a full federal assessment of a proposed SMR at the Point Lepreau nuclear site, on the Bay of Fundy. “This is a victory for citizens seeking oversight and good process,” Louise Comeau, CRED-NB’s director of climate change and energy solutions, said in a release.

“As early as June of next year, NB Power wants a licence from the nuclear regulator to proceed with site prep for the ARC nuclear reactor,” added spokesperson Ann McAllister. “There are many challenges, however, a licence can’t address that an impact assessment can.”



in Canada, Energy Politics, Finance & Investment, Heat & Power, Hydropower, Nuclear, Solar, Subnational, Subsidies, Wind

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Comments 2

  1. Dr. John Miller says:
    2 years ago

    Dear Mitch,

    Long time, no talk to. I wish you would have made it clearer whether the plant will be 300 MW electrical or thermal. Nuke plants are only about 32% efficient, so it makes a huge difference. 300 MW thermal is about 100 MW elecrical.

    John Miller, NASW

    Reply
    • Mitchell Beer says:
      2 years ago

      Great question, John, thanks. I’ve never seen this addressed explicitly (Angela B., Susan O’Do, or anyone else who’s steeped in the details, have you?). But the implication has always been that they’re delivering 300 MW electrical.

      Reply

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