As the proverb says, “The best time to plant a tree was 20 years ago. The second-best time is now.”
This rings true as Canada stands on the precipice of a future of quickly increasing electricity demand while also committing to a climate change goal of reaching net zero carbon emissions.
Canada is currently powered by an electricity system as diverse as its sprawling landscape. This system was developed over 100 years. We need to expand it and do so quickly, but Canada does not have the policies or infrastructure in place to scale with the demands before it, and certainly not if it’s going to achieve net zero by 2050.
Understanding Canada’s Energy Needs
Canada’s electricity demand is forecast to double by 2050, meaning supply will have to at least double from today’s volume of production, as stated in the Public Policy Forum’s recently released report, “Project of the Century: A Blueprint for Growing Canada’s Clean Electricity Supply – and Fast”.
“Canada’s electricity demand is forecast to double by 2050, meaning supply will have to at least double from today’s volume of production.”
To put this into perspective, the report stated that the large Churchill Falls and Robert-Bourassa hydroelectric generating stations and Bruce Power nuclear generating stations currently account for 11% of Canada’s clean electricity generation capacity, and to meet future needs, we would need at least another 18 of each.
Ontario is Pioneering Nuclear Power
Ontario has a head start on most other provinces with an electricity grid that’s one of the cleanest in North America (93% clean energy), but its Independent Electricity System Operator (IESO) has predicted that capacity may have to grow by more than 50% to meet the electrification and clean energy needs of the next few decades.
The province was an early adopter of nuclear power with Canada’s first commercial reactor opening in the 1960s at Douglas Point. It has also been a leader in the clean energy space with nuclear power helping to wean the province off coal in 2014. It also green-lit refurbishment projects at Ontario Power Generation’s (OPG) Darlington site and Bruce Power to ensure a stable baseload of clean energy.
The Ontario IESO’s “Pathways to Decarbonization” Report states that “attaining a decarbonized electricity sector by 2050, alongside aggressive electrification, would require a system more than double the size it is today at an estimated cost of around $400 billion,” and that “significant investments in capital, materials and labour are needed, and emerging technologies will need to be developed.”
“Large infrastructure such as hydroelectric and nuclear power facilities and transmission can take 10 to 15 years to build. Preliminary work should begin now.”
Even though Ontario has advanced further to meet electrification and clean energy needs compared to some other provinces, the crux of the issue is how quickly this can happen, while also reducing the number of carbon-emitting gas plants and expanding in the process. The IESO report identified several risks to meeting its goals, including:
- Large infrastructure such as hydroelectric and nuclear power facilities and transmission can take 10 to 15 years to build. Preliminary work should begin now so that options are available in the 2030s and beyond.
- Significant investments in capital, materials, and labour will be required to build out a fully decarbonized system. IESO’s report estimates that the 14,000-strong labour force currently working on electricity infrastructure projects could need to increase by six times over the next decades.
- The growing participation of local communities and First Nations across the province in terms of how and where new infrastructure is located requires meaningful and transparent discussions about siting and land use.
- While many of the technologies needed to decarbonize are already known and commercialized, many others, including storage, low-carbon fuels, and small modular reactors (SMRs), are still in development. It will be important for Ontario and Canada to continue to invest in these and other innovations.
- Energy plans need to be approved and new infrastructure needs to be planned, permitted, and sited. Federal and provincial regulatory and approval processes, such as environmental and impact assessments, need to be resourced appropriately and streamlined. Simply put, the federal permitting processes can take longer than the technology deployment, increasing costs and stifling clean energy.
- Costs must be carefully managed to ensure the actual impact on total energy costs is affordable and that they do not diverge significantly from those of our neighbours. Rapidly rising electricity costs could discourage electrification, stifle economic growth, or hurt consumers with low incomes.
Ontario’s Minister of Energy, Todd Smith, recently unveiled the province’s Powering Ontario’s Growth plan, stating that “We need to act today to ensure we have the energy we need to power economic growth and electrification over the next three decades while maintaining our clean electricity advantage.”
“The federal permitting processes can take longer than the technology deployment, increasing costs and stifling clean energy.”
Working with the IESO, the Ontario government identified “no-regret actions” to meet growing energy demands through 2050, including:
- Exploring options for new, large-scale nuclear power at Bruce Power
- Moving ahead with new small modular reactors at Darlington
- Building new transmission lines
- Advancing pumped hydroelectric storage projects
- Optimizing OPG’s hydroelectric fleet
- Planning for future energy efficiency programs
- Introducing competitive electricity procurement for clean resources such as wind, solar, hydroelectric, battery storage and biogas
It’s clear that the Ontario government values nuclear power as a source of clean, reliable baseload electricity providing energy security and economic growth as a Canadian-made technology.
Nuclear Power in Canada
With nuclear power as a secure and reliable clean energy source and a shift in public opinion, nuclear power currently accounts for about 15% of Canada’s electricity, mostly in Ontario (60% of Ontario’s supply), where approximately 40% of the country’s population is located.
There are currently 18 nuclear reactors in Ontario and one in New Brunswick. Over the past decade, OPG and Bruce Power have developed plans to extend the lives of 10 of the 18 reactors in the fleet, but construction of new nuclear-generating stations has been deferred as the province was deemed to be in a strong supply situation.
“The Ontario government is looking to leverage its nuclear advantage through new large-scale advancement of nuclear energy and other clean energy technologies to lead the way in decarbonization.”
Now, with increasing recognition of clean electricity’s vital role in combatting climate change, the Ontario government is looking to leverage its nuclear advantage through new large-scale advancement of nuclear energy and other clean energy technologies to lead the way in decarbonization.
While the commitments to the nuclear industry in Canada will go a long way to ensuring it is a strong part of a clean energy future, there are steps that can be taken now by both Provincial and Federal governments to streamline the siting and technology development process.
Minister Smith’s plan for Ontario’s clean-energy future is indeed ambitious and it’s going to take collaboration with the Federal government to overcome some of the barriers to move these solutions along.
What Governments Can Do to Advance Nuclear Power
The Federal government must continue to work with the provinces to accelerate and prioritize clean energy projects, prioritizing brownfield sites, and holding to its promise in the 2023 budget to streamline major project approvals by the end of this year.
The Federal Impact Assessment Act is a necessary piece of legislation that outlines a process for determining the impacts of major projects, however, the current regulatory landscape often results in lengthy delays and duplication of similar processes at different levels of government, ultimately limiting the ability of project proponents to build the critical infrastructure needed to support a clean economy.
“Private sector investors need cost recovery mechanisms to allow them to undertake the pre-requisite studies and impact assessments when exploring large-scale energy projects.”
The impact assessment process should be forward-looking and allow for conversations and activities within the impact assessment framework to take place before a specific project is proposed. This would allow for the development of new site options for clean energy assets.
In addition, private sector investors need cost recovery mechanisms to allow them to undertake the pre-requisite studies and impact assessments when exploring large-scale energy projects.
The federal government has committed to fast-track the assessment of mining, energy, and other major projects, and to make Canada’s rigorous regulatory process more efficient. This includes:
- $1.3 billion over six years, starting in 2022-23, and $55.4 million ongoing, to the Impact Assessment Agency of Canada, the Canada Energy Regulator, the Canadian Nuclear Safety Commission, and 19 other federal departments, to continue to improve the efficiency of assessments for major projects
- $10.6 million for Natural Resources Canada’s Centre of Excellence on Critical Minerals to provide direct assistance to critical mineral developers in navigating regulatory processes and government support measures
- $40 million to Crown-Indigenous Relations and Indigenous and Northern Affairs Canada to support Northern regulatory processes
“Canada has the potential to become a clean electricity superpower with a cross-Canada electricity grid that is more sustainable, more secure, and more affordable,” the budget document said. “The accelerating transition to net zero has started a global race to attract investment as our friends and allies build their clean economies. Canada must keep pace. We cannot afford to fall behind.”
Tax credits for clean energy technologies will help to provide a clear and predictable incentive that is available to this range of asset owners, which is needed to accelerate our progress toward a net-zero grid.
“Tax credits for clean energy technologies will help to provide a clear and predictable incentive that is available to this range of asset owners.”
Creating a level playing field is important. If the US adopts less onerous policies and regulations, it could attract industry suppliers, skilled trades, and talent. While competing with the scale of the United States Inflation Reduction Act (IRA) may not be possible, we could make it easier and less expensive to deploy clean energy and be more nimble, while also protecting the environment.
The United States IRA introduced massive subsidies for the production of clean technologies and clean products and Canada must act quickly to implement its budget promise of Investment Tax Credits (ITC) for clean technologies to mirror the US IRA measures and mitigate the competitive impacts.
The 15% refundable Clean Energy ITC would apply to non-emitting electricity generation systems, including nuclear power, and would also apply to new projects and the refurbishment of existing facilities.
Can Canada Lead the World?
As a country, we must leverage our unique ‘Made-in-Canada’ solutions to meet our electrification and climate change needs. Canada finds itself in a position of strength when it comes to new nuclear development as it already has its own, innovative nuclear technology in the CANDU reactor and is a world leader in SMR deployment.
“Canada needs to ensure CANDU is given the right amount of support from an industry consortium to compete in a modern design setting as new nuclear builds will be required across the globe.”
The CANDU design has been deployed worldwide over the past 50 years and it has a robust nuclear supply chain that provides everything from fuel to components, construction, maintenance, and tooling. The benefits include its ability to run on unenriched natural uranium, mined right here in Canada, and its proven passive safety systems. Canada needs to ensure CANDU is given the right amount of support from an industry consortium to compete in a modern design setting as new nuclear builds will be required across the globe.
Our nuclear supply chain consists of more than 250 companies and 75,000 highly skilled workers. It not only drives economic stability and growth, it is constantly evolving and innovating and should be leveraged and nurtured to ensure a stable, secure, and made-in-Canada clean energy solution is available to the world.
In Ontario, the nuclear industry is also working to help other businesses offset carbon emissions through Ontario’s new Clean Energy Credit (CEC) registry, providing businesses with a tool to meet environmental and sustainability goals by demonstrating that their electricity has been sourced from clean resources. The proceeds of these CECs will help keep costs down for electricity ratepayers and fund the construction of clean electricity projects in Ontario through a newly created Future Clean Electricity Fund.
Clean energy from nuclear power in Canada is in a strong place with the refurbishment of the existing fleet to provide power for the next several decades and the promise of new nuclear deployment on the horizon. However, we must continue to advance and improve to meet the future needs.
Even previously skeptical environmentalists now see the value in this clean technology and the days of scare-tactics of the misinformed have been replaced with strong, broad-based public support. People are now talking about nuclear power as a leader in clean energy and the offshoot production of medical isotopes from CANDU reactors has made Canada a world superpower in medical isotopes as well.
It’s clear that the nuclear industry must be part of a secure, reliable, and clean energy mix to help Canada reach its net zero goals. Now is the time to plant the tree.