Natural Resources Committee on Nov. 29th, 2007

[The Chair, Conservative, Leon Benoit]

Mr. Duguay.

[Prof. Michel Duguay]

Yes, I think you're right: it could be done right, the way you explained it. But one little thing one has to remember is that we're supposedly all in favour of sustainable development. AECL is also in favour of sustainable development. The uranium reserves are not that large. They may be large in Canada, but there's the entire world that Canada is selling to. So all these people are trying to develop new types of reactors that will make more efficient use of uranium-238, as well as uranium-235, and perhaps even thorium.

So if we're talking about sustainable development, we have to keep in mind a little bit that we have children and grandchildren, and if nuclear power is that great, there should be some uranium left over for them too.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

I appreciate that.

I appreciate your thing of looking towards the future, but by my count, we have six major installations in Canada: Bruce Power A, Bruce Power B, Darlington, Pickering A and B, Hydro-Québec's site, and New Brunswick Power at Point Lepreau.

If we don't pass this bill, we're just leaving the liability at $75 million. There's no way that this $650 million will cover a core major disaster. I mean, it's $3,000, $800, whatever per person. It's not even going to come close.

So the insurance here is basically to cover up, if we can use the term, a small accident, a Three Mile Island that doesn't completely wipe out New York City or wherever it would be here. If we just leave this at $75 million and something small does happen, we end up picking up that gap between $75 million and $650 million.

Is there a different number? Is there a different interim measure that we should take for these smaller types of incidents?

[Prof. Michel Duguay]

If you read the AECL documentation, you are forced to have at least $650 million, otherwise you're left out of the international community and it's total disaster for nuclear power.

[Gordon Edwards]

This is basically a commercial guarantee that the industry wants for its own purposes. On the $650 million, has there been any study conducted? Has there been any study that shows that $650 million is a logical amount?

When we talk about nuclear accidents, I am sure you cannot have a nuclear accident that causes more than $10 million in damages unless it is a core-melting accident.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

Mr. Edwards, I guess the reason is that, in my research, they had done the modelling in today's dollars on what Three Mile Island would cost, and it was in the neighbourhood of $650 million. We're also using—and maybe you could look at it, for your opinion—

[Gordon Edwards]

I'd be interested in taking a look at it.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

—a similar report that NRCan had done, and these numbers, within that broad range, had also been there. That's why in our research we had been looking at these numbers.

[The Chair, Conservative, Leon Benoit]

You still have 45 seconds, Mr. Trost, or someone else from the government side. No more?

Okay, we'll go back to the official opposition. We have roughly six minutes left. We'll go with two minutes for each questioner in the next round, so basically one question.

Mr. Tonks.

[Alan Tonks, Liberal, York South—Weston, ON]

Thank you very much, Mr. Chairman.

Thank you for being here. Your testimony, as Ms. Bell has indicated, has enervated our sense of accountability.

The question has been asked with respect to how you establish risk assessment. I would assume that the risk assessment would be related to the capacity for the industry to self-regulate it. You have indicated that the regulating functions are inadequate. You've at least referred to the AECL.

We had NIAC here, which said it has its own engineers and so on, and this should increase the public's sense of accountability. Then you come in and say, look, we have great concerns with respect to the ability for the regulating function to be carried out, even though it goes beyond this bill.

May I ask you on behalf of the committee whether you have seen a presentation that appraises the total regime and framework and establishes clear thresholds where accountability is wanting, or other approaches that could be taken that this committee could consider as part of this or another bill? Is there any such thing that you've seen?

[Gordon Edwards]

I don't know of any such study.

I would like to apologize to the committee if there's any edginess to my remarks. I think the edginess is basically a reflection of frustration that the committee does not have available to it the tools that would be necessary to do a really good job. That's my concern.

Especially if we are going to have a nuclear renaissance and build more reactors, then I think it's very necessary for legislators to have much more knowledge and resources available to them to weigh these problems. I sympathize with members of the committee, who are given very little to go on other than a piece of legislation that has been written without much deliberation of the deeper issues surrounding that. So that's really the basis of my frustration.

The accountability problem is, I think, a serious one, and one that Parliament must take seriously for the future, because right now the Canadian Nuclear Safety Commission answers to the same minister that Atomic Energy of Canada Limited answers to, which is the Minister of Natural Resources. This means there's only one voice at the cabinet table speaking on nuclear issues. Even the CNSC itself, the Canadian Nuclear Safety Commission, although it is responsible for the health and environment, it has no health department. It does not have a staff of independent health scientists. Most of its staff are drawn, in fact, from the very industry that it is regulating, and the minister it is reporting to is the minister who is promoting that very industry.

Now, this poses serious governance problems for the future. I would like to see, at some point, some aspect of the House of Commons, or some aspect of our parliamentary system, that stands up and doesn't take the first offer that's put on the table.

Where's the negotiation? If we're representing the public interest, should we just take the industry's offer of $650 million and say, “Thank you, thank you, we'll take it, we'll pay all the rest”? Or should we say, “Wait a minute now. You're asking the Government of Canada, asking the taxpayers, to assume an enormous financial liability, and you're limiting yourself to $650 million? Let's negotiate. Let's talk about this.”

I don't see any negotiation taking place. The question remains, where is the accountability?

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Edwards and Mr. Tonks.

Now to the Bloc Québécois.

Madame DeBellefeuille.

[Claude DeBellefeuille, Bloc, Beauharnois—Salaberry, QC]

Thank you very much, Mr. Chairman.

Thank you, Mr. Edwards and Mr. Duguay.

You studied a lot. You are university professors. The evidence you gave is therefore credible. We must take it just as seriously as that of all the other witnesses we heard.

I listened to your presentations and as a citizen and a member of Parliament I am of the opinion it would be irresponsible to maintain the coverage at only $75 million dollars. One must be consistent and recognize that governments, both liberal and conservative, neglected to do the catch-up that was required. The result is that today we must jump from $75 million to $650 million dollars. There are also the premiums that the nuclear power operators have to pay and the pressure they are under as a consequence. Their concern is understandable. For years, there has been this neglect on the part of the governments in power in Canada.

I agree with you, $650 million dollars is far from enough. Just imagine if an accident were to happen in Pickering. The industries and the municipal infrastructures of cities like Oshawa and Toronto would be completely destroyed. We know that just one accident in the history of Canada, in any nuclear plant, would cause damage well in excess of 650 million dollars.

The witnesses we heard before you told us that it is difficult at the present time to find insurers offering coverage beyond $650 million dollars. In Europe, some countries have asked for one billion dollars protection. The amendment of the Paris Convention is presently delayed because there are not enough funds to pay for such a coverage.

As you say, we the members of Parliament are more or less stuck, as you say. We lack tools and information.

If we increase coverage and if operators are liable for 100% of all the damage caused, would the insurance, the cash and coverage be available everywhere in the world? This is my big question.

I agree with you, we should not promote nuclear energy. We should not encourage this form of energy, however we have nuclear plants operating at the present time. We must look at how we will be able to compensate municipalities or Canadians should an accident occur.

What do you say about the fact that no one, no insurance company, will cover the operators? What can we do in this regard?

[Gordon Edwards]

I'm not sure I fully understood everything you said.

[The Chair, Conservative, Leon Benoit]

Mr. Edwards, the answer will have to be quite short. Her time is up, so could you give just a very short response, please?

[Gordon Edwards]

I think you were asking what would happen if the coverage weren't available. Is that what you were asking—what would happen if they couldn't provide the coverage?

I think in that case, one has to consider whether such a liability should be allowed to exist, because really this is a question for society at large. In fact, that was one of the comments made in the early days by one of the insurance executives. It's questionable whether such a liability should be allowed to exist.

That's the reason for the comments about siting, remote siting, and underground siting. These are the things that are important to consider. If the industry can, in fact, design reactors that are free of these difficulties, then they should do so.

One of the ways of pressuring them to do so would be to not pass this kind of legislation, which allows them to continue to be, you might say, sloppy and not to have to design reactors that are truly safe.

[The Chair, Conservative, Leon Benoit]

Thank you.

Finally, we will go to Mr. Harris for two and a half minutes.

[Dick Harris, Conservative, Cariboo—Prince George, BC]

Thank you.

Mr. Edwards, in response to your last comment that this type of liability arrangement would lead to sloppiness in design, I kind of think that the nuclear scientists who design these projects are professionals. They're fully trained in what they do, and they would probably take offence to that. I don't fit in that category, so I'll leave that offence to them.

I want to get to a point that talks about the cost of the liability versus the cost of doing all of the things that you've suggested. In your studies, apart from determining that there are some serious safety factors, in your opinion, with the existing sites and the way we're building them now, have you taken all of your suggestions into consideration and arrived at the extra cost factor of putting all of your ideas into being? How would that relate to the electricity charge to the consumer?

After all, whether it's a liability insurance claim or it's doing all of the things that you suggest, there's only one person who's going to pay for it. It's going to be the user of electricity.

How do your ideas, in total, relate to electricity costs for the consumer?

[Gordon Edwards]

I think it would make nuclear power reflect the true costs of nuclear power more accurately than it does at present. At the present time, the marketplace gives false signals. It gives the signal that the nuclear power is cheaper than it really is.

So I think it would be a correction. It would be a correction to the market and would make the nuclear electricity be priced more realistically in terms of other options.

And by the way, they're not my suggestions. These suggestions are suggestions made by royal commissions and by people in the nuclear industry itself.

[Dick Harris, Conservative, Cariboo—Prince George, BC]

I understand that, but I'm hearing it from you today, and so you've obviously done your background.

So you're suggesting that the nuclear industry is giving out false operating costs, and their rates are falsely identified because of shortfalls and sloppiness in the building of them, that they don't want to talk about? Is that what you're suggesting?

[Gordon Edwards]

I believe that's why Ontario Hydro accumulated a $30 billion debt and had to off-load a good portion of that debt onto the backs of the ratepayers, which they pay every month on their hydro bills as stranded debt. It's because—

[Dick Harris, Conservative, Cariboo—Prince George, BC]

Do you have documentation to back up that statement, sir?

[Gordon Edwards]

It's because the price of nuclear electricity has not been properly assessed in the first place.

[Dick Harris, Conservative, Cariboo—Prince George, BC]

Is that an opinion or do you have documentation to back that up?

[Gordon Edwards]

There is much documentation to back that up.