Evidence of meeting #42 for Natural Resources in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was accident.
A recording is available from Parliament.
3:30 p.m.
Conservative
The Chair Conservative Leon Benoit
Good afternoon, everyone.
We are here today to continue our clause-by-clause study of Bill C-20, an act respecting civil liability and compensation for damage in case of a nuclear incident. We had started our discussion on clause 15.
Is there any further discussion on clause 15?
Mr. Cullen.
(On clause 15--Liability for economic loss)
3:30 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
If the committee recalls the last meeting we had, there was a question of a report that the government had commissioned in order to try to assess the risk and liability at nuclear facilities. I'm not sure whether you recall that, Chair, but there was a discussion about producing that report, which we now have. I have some questions regarding it, because what it does for, say, clause 15 in particular, but also again for clause 17, is set the context for what we're talking about in terms of where the government made assumptions.
I was looking to you for your recollection. Do you recall this conversation that we had at the last committee meeting?
3:30 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
I know you thought it was scintillating.
Here is a question to our witnesses. The report that was referred to—I'm not sure whether all committee members received it, but it's extremely informative—was a review of the coverage limit in the Canadian Nuclear Liability Act, task 5, final report, presented to the Canadian Nuclear Safety Commission on May 30, 2003, by International Safety Research in collaboration with Magellan Engineering. I'm not sure whether other committee members have this.
Do our witnesses have it with them today—or if not with you, do you have knowledge of it and know its conclusions?
3:30 p.m.
Voices
Yes.
3:30 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
For the committee's understanding—I think this is critical for understanding the clause in front of us, in terms of economic loss imagined under this bill—this report was commissioned and presented May 30, 2003, by government.
I want to make sure I'm right in assuming that this formed at least part of the government's thinking about the liability regime. Is that right, Mr. McCauley?
3:30 p.m.
Dave McCauley Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
We had recommended the $650 million limit based on the international standard as well as the capacity of insurance that was available and the inflation associated with the liability limit in the existing act. Then we felt it was necessary to take a look at a design-basis accident to see what the results of it would be vis-à-vis the $650 million recommendation—how the two related.
It wasn't that we did the report and then set a limit, but rather that we had come to a decision on the limit and thought it would be helpful to do a risk assessment. The CNSC had actually commissioned the study, but we asked them to, because they have the expertise in this area.
3:35 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
Just so I understand the chain of events in relation to economic loss considerations, the government had a desire to modernize the Nuclear Liability Act, because it had been in place for some years. The government then set up a piece of legislation, and when the question came to potential economic loss and what type of liability limits should be incorporated into the act, you commissioned—or you requested, or you funded—the CNSC to go forward and have International Safety Research and Magellan do such a study.
I want to get the time sequence right, to understand where you landed with this report.
3:35 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
What we did initially was a discussion paper on the issue. We consulted the stakeholders. Based on that, we moved forward and identified the limit of $650 million, but in assessing the limit and seeing whether it was appropriate, we also had the CNSC commission this study.
3:35 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
Just to understand you right, then, the $650 million figure came prior to this report's being done. That was an internal government decision.
3:35 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
That's correct.
3:35 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
I assume that's based on looking around at international regimes.
3:35 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
We're looking at the limits in the International Atomic Energy Agency convention. That's right.
3:35 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
With respect to clause 15, this report then seeks to understand what the costs would be of a nuclear accident, and two sites were chosen. Is that correct?
3:35 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
That's correct.
3:35 p.m.
NDP
3:35 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
That's correct.
3:35 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
There are two assumptions that are made in this report that then lead the government to assess what kinds of limits and economic losses might be effected. One assumption is that two reactors were chosen by location. The other assumption was that it was a contained type of accident, and we talked about this last time. It wasn't an accident that went beyond the barriers of the facility.
3:35 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
That's right.
3:35 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
There are only two recommendations—and this is the important part for the committee to understand—that came out of this government-commissioned report, or the CNSC-commissioned report. One recommendation was that the analysis be repeated to cover the domain of what they call “severe” accidents, again using a probabilistic analysis approach to provide an accident coverage presentation for serious accidents at both Gentilly-2 and Darlington.
There are only two recommendations made out of this report. One of them was that the government should do another analysis to cover what they call “severe” accidents. Did the government do this analysis prior to the presentation of Bill C-20?
3:35 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
No, we didn't.
3:35 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
I think the philosophy was that the limit would be addressing foreseeable risks associated with design-basis accidents as opposed to severe or catastrophic risks.
3:35 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
I understand that's the assumption you made, but the folks, the report writers, who did this study for you to assess the effects of nuclear accidents, the economic loss that might be incurred by a person, what we're studying in clause 15, told the CNSC, and through the CNSC to the government, that they should also do a study and analyze the effect of a “severe” accident. I don't understand why the government wouldn't do that.
Why maintain the assumption of a limited or small-scale accident? The report writers themselves said, that's fine, we've done this for you, this is where we think the limits should be, but you also must consider a severe accident, and yet the government doesn't go through with that consideration.
3:35 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
I think our rationale was that we understood that the act would not address a severe accident in terms of the liability limit. The legislation addresses any kind of an accident that would happen, but in terms of the liability limit, we set an amount that was based on an international standard and reflected insurance capacity and other parameters. We looked at what a foreseeable incident was and how the impacts associated with a foreseeable incident would relate to the $650 million limit.