Canada’s domestic nuclear industry took a major step forward on Monday. With the announcement of Capital Power and Ontario Power Generation partnering to explore developing small nuclear reactors in Alberta, an exciting future appears tantalizingly within reach.
This announcement to potentially add new and reliable energy could not have come at a more opportune time for Alberta as the province sought to avoid blackouts in the extreme cold this past weekend. While the close calls served to bring the nature of Alberta’s electricity grid into the mainstream conversation, it is far from the only province we should be scrutinizing.
Expanding nuclear generation across the country is a necessary requirement to decarbonize the five provincial grids—Alberta, Saskatchewan, Ontario, New Brunswick, and Nova Scotia—that lack massive quantities of hydroelectricity to meet their electricity needs. (The other provinces have more than 87 percent of their electricity from hydropower.)
Of these, only Ontario and New Brunswick currently operate nuclear plants. Nuclear power already represented 38 percent of New Brunswick’s electricity in 2019, and 59 percent in Ontario. For them, this represents a significant source of affordable, non-emitting energy, with wind, solar, and gas providing complementary sources of generation as required.
By contrast, the percentage of fossil fuels in the grids of Alberta (81 percent), Saskatchewan (77 percent), and Nova Scotia (57 percent) creates exposure to global volatility in price changes, an overreliance on high-emitting sources of electricity, and loss of investment from companies seeking cleaner grids. With a lack of hydroelectricity, nuclear energy represents the only viable path forward to create reliable, non-emitting baseload power in these provinces.
In this scenario, both natural gas and renewables can play a valuable role in balancing supply and demand to the benefit of the consumer, with the cheapest source dispatched when available and needed. The overall emissions from the grid would be reduced while still accommodating unique provincial circumstances and serious weather events, such as those this past weekend in Alberta.
Provinces and the federal government have already begun to make extensive plans to develop their grids in ways that are cleaner and cheaper, but there is a lack of understanding by policymakers at the federal level as to the nature of the complexity of electricity grids. With the recent requirement that grids be net-zero by 2035 outlined in new regulations from Ottawa, there are significant obstacles for provinces that lack existing nuclear assets or large hydroelectric supplies to meet it. There are ample measures that can be taken to help make grids cleaner, but the timeline of 2035 is unrealistic and serves only to disrupt large capital investments which need stable long-term timelines and are required to meet the capital-intensive goals we are committing to.
That’s why this announcement from OPG and Capital Power is so exciting. Perhaps most intriguing is that this is a project being led by the private sector, unlike many other high-profile, big-budget government announcements related to net-zero initiatives. Combining Capital Power’s private capital with Ontario Power Generation’s know-how to meet timelines in nuclear power, should be a win-win.
All governments should be cheering on this partnership and seeking to make it a success. For the emissions-conscious watchers in Ottawa, the project advances reductions in one of the highest-emitting provinces. Alberta, for its part, will benefit from more reliable baseload generation and lower electricity prices for consumers.
Ontario also has a stake: this is another interprovincial partnership, atop Saskatchewan and New Brunswick, that OPG has entered into. Making itself the country’s centre of gravity for a burgeoning nuclear industry is another feather in the cap for the Ontario economy and creates an increased potential for overseas export. Exporting nuclear power plants abroad would maximize OPG’s first-mover advantage and provide maximum benefit to all parties involved, including highly lucrative revenue streams.
Finally, increased reliance on nuclear power will grow Canada’s cross-country economic value chain by developing demand for Canadian value-added products. Saskatchewan is blessed with immense reserves of uranium, Ontario has technological expertise with nuclear supply chains, and increased domestic investment in Canadian nuclear projects will bring down the industrial development learning curves, making the industry more internationally competitive.
Those international investments could potentially generate billions in new revenue for Canadian companies as countries around the world look to decarbonize. Given that the main challenges to increasing the deployment of nuclear power on the global level are related to cost issues and time overruns, successfully demonstrating that Canada can solve those problems is an unquestionably valuable advantage.
Beyond the tangible rewards, developing stronger interprovincial trade links will only help to shore up the country’s faltering national unity and boost Canada’s sense of self.
Overall, though, all the economic and environmental benefits of the Capital Power-OPG agreement represent an exciting model that ought to be applauded and emulated across the country. Canada has made some lofty energy and emissions reduction goals. This is an important, if incremental, step towards reaching them.
