Varcoe: Prospects for nuclear power resurface in province with new partnership between Alberta, Ontario generators

‘This is a significant announcement because it is not about the oilsands, it’s about the grid and it involves a major electricity provider in this province,’ said MRU political scientist Duane Bratt

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The notion of nuclear power in the oilsands has kicked round for decades, including the wild 1950s Project Cauldron proposal to detonate a bomb underneath the province to assist in bitumen recovery.

That idea fizzled out, but the concept of developing nuclear power in Alberta has resurfaced several times over the years.

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The prospect of building a small modular reactor (SMR) to provide electricity to Alberta’s power grid took a notable step forward Monday with a new partnership between Edmonton-based Capital Power and Ontario Power Generation.

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It involves two serious players, with decades of experience operating generation facilities in Alberta and nuclear power units in Ontario, coming together to examine the feasibility of SMRs in this province.

“This is a significant announcement because it is not about the oilsands, it’s about the grid and it involves a major electricity provider in this province,” said Mount Royal University political scientist Duane Bratt, who teaches on the science and politics of nuclear energy.

“And it involves a partnership — not between the government of Alberta and Ontario, but with the people who actually do the work.”

At a news conference in Edmonton, the leaders of Capital and Ontario Power Generation (OPG) discussed their plan to jointly assess within two years the deployment of small nuclear plants in the province, including possible ownership.

OPG is building four 300-megawatt SMRs at its Darlington nuclear site, with the first one expected to start operating in late 2028 or 2029.

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In an interview, Capital Power CEO Avik Dey said the partnership will see the Alberta generator commit people, time and capital toward accelerating its knowledge of SMR technology.

It will explore the necessary regulatory and permitting processes needed to deploy such a unit within Alberta, a province that has never had an operating nuclear facility.

“We see nuclear playing a critical role in providing baseload dispatchable generation in Alberta, in a 2035 type of time frame,” Dey said Monday.

“In a jurisdiction that currently does not have a regulatory framework specifically for nuclear, we feel it’s important that we start this effort now.”

Dey said the company would be looking at a 300 MW unit in Alberta.

The partnership is a timely one, given the red-hot debate about how Alberta should best decarbonize the province’s electricity grid, which is highly reliant on natural gas. The federal government wants provincial power systems to reach net-zero status by 2035, while Alberta favours a 2050 time frame.

The province also just endured a brutal deep freeze that sent electricity demand to record levels. On Saturday night, the Alberta Electric System Operator (AESO) warned of the potential of rotating outages, which prompted consumers in the province to quickly cut power use.

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Alberta power grid
The warmup has started, but questions arise on the province’s power grid. Photo taken in Calgary on Monday, January 15, 2024. Darren Makowichuk/Postmedia

Over the next 12 months, Alberta should see about 1,900 MW of additional gas-fired generation arrive in the market, but more electricity will be needed in the decades ahead.

Capital Power is already working on a proposed carbon capture project tied to its Genesee gas-fired generating station.

Now, it’s putting nuclear in Alberta under the microscope.

“As we tested the limits of our grid over the course of this past weekend, it just really amplifies the importance of dispatchable generation,” Dey added.

Nuclear power has long had staunch critics, particularly over the issue of waste management and its high capital costs on larger units.

Chris Severson-Baker, executive director of the Pembina Institute, thinks nuclear will face long development timelines in Alberta, with the need to develop an approval process and regulate an industry that’s never operated in the province.

He worries it risks diverting attention and resources away from more immediate opportunities to decarbonize the grid.

“SMRs may have an important role to play in the long term, but they are so far from being an option, especially in Alberta,” said Severson-Baker.

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“The cost information is the thing that is most lacking.”

Ontario Power Generation Darlington nuclear facility site
FILE PHOTO: Workers assemble a new building at the Darlington nuclear facility in Courtice, Ont. on Thursday, October 30, 2014. Ontario Power Generation said the small modular reactor is scheduled to be completed by 2028. Frank Gunn/The Canadian Press

Ontario Power Generation hasn’t put out final cost estimates, but that step will occur in early 2025 when it gets a licence to construct from the regulator, said company CEO Ken Hartwick.

“The first one is going to be a little bit more expensive,” Hartwick told reporters Monday.

“But we anticipate the other three being less and we anticipate someone like Capital being able to utilize our learnings so that they get the benefit of a lower cost to build here.”

According to the International Atomic Energy Agency, there are more than 80 SMR designs available; facilities are being developed in Canada, the United States, China, Russia, and Argentina.

With about one-third of the generating capacity of larger nuclear reactors — or smaller — SMRs are designed to be cheaper and have lower fuel requirements.

“The partnership is derisking the cost issue for Albertans because they are bringing in an operator who builds and operates nuclear plants,” said John Gorman, CEO of the Canadian Nuclear Association.

“It’s not like Alberta will be a loss leader on this.”

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Oilsands producers continue to examine the potential for SMRs, which could supply non-emitting heat and power to assist the sector in reaching its net-zero target by 2050.

The Pathways Alliance group of oilsands operators has formed a working group from its members to study the technology.

“If we can confirm the commercial and economic viability of the technology and work through any regulatory challenges, SMRs could be an important part of the oilsands’ long-term low-emissions future,” Pathways Alliance president Kendell Dilling said in a statement.

Pathways Alliance CEO Kendall Dilling
Pathways Alliance CEO Kendall Dilling is interviewed at the World Petroleum Congress in Calgary, Monday, Sept. 18, 2023. Jeff McIntosh/The Canadian Press

Heather Exner-Pirot, director of natural resources, energy and environment at the Macdonald-Laurier Institute, said SMRs are almost a “perfect use case” for the oilsands, producing industrial heat and power.

Small modular reactors will be reliable in colder climates, and Canada has uranium and established supply chains in place.

“It is zero carbon. It’s baseload (power). It’s domestic, it’s energy security — to me, it’s so much superior to renewables from those perspectives,” she said.

“It is part of the zero-carbon future, for sure.”

Chris Varcoe is a Calgary Herald columnist.

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