No, not necessarily.
Evidence of meeting #41 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 operator.
A recording is available from Parliament.
Evidence of meeting #41 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 operator.
A recording is available from Parliament.
4:05 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
No, not necessarily.
4:05 p.m.
Voices
Oh, oh!
4:05 p.m.
Conservative
The Chair Conservative Leon Benoit
Okay. I thought you had indicated.... I'm sorry. That's fine.
Mr. Cullen, is there anything else?
4:05 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
The question that was passed over was on the policy initiative, so again, it's the exclusivity. I'm getting to this point. I understand now that we've had a ruling and the bill is seen to be an exclusivity liability bill, but I don't understand just in a common sense kind of way. If somebody sells a faulty part to a nuclear operator, and that causes an accident, the nuclear operator is not able to seek compensation or damages from the supplier. It seems counterintuitive.
4:05 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
On the issue of exclusivity, the reason that in Canadian and frankly all schemes of nuclear liability the operators are absolutely liable is that the intent is to ensure, number one, that it's easy for victims to claim compensation. There's no need to prove negligence and so on. If there were an incident and they sustained damage, the owner or the operator of the facility would be liable; there's no need for the victims to prove negligence.
Another reason is that it's important to.... Because there's not a lot of insurance capacity available to insure the nuclear industry, what has been done is that it has all been channeled to one individual, the operator. Whereas all other entities in a normal tort scheme might be liable, it's all focused on the one operator.
4:05 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
If I'm following you, a supplier of parts to a nuclear operator is unable to get the kind of insurance it might need if it were also deemed potentially liable in the event of an accident. You free that up by locating it all with the operator. Is that it?
4:10 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
That's right. In fact, all insurance... Your homeowner insurance actually states that you will not be able to get any home insurance to protect you against third party nuclear damage because it's all focused on the operator. It's the operator who has the coverage.
4:10 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
I just want to complete this chain. It also extends to contractors on a site. They don't have to pick up any kind of insurance for faulty work. The parts suppliers also are outside this normal tort scheme.
4:10 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
They cannot get insurance to insure against third party damages.
4:10 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
That's right. All the insurance is provided to the operator.
4:10 p.m.
Conservative
4:10 p.m.
Conservative
The Chair Conservative Leon Benoit
If you want to come back, that's fine. I want these questions answered, of course. That's what we're here for.
We'll go to Mr. Hiebert.
November 23rd, 2009 / 4:10 p.m.
Conservative
Russ Hiebert Conservative South Surrey—White Rock—Cloverdale, BC
For the benefit of Mr. Cullen, I'll ask a question of Mr. McCauley. Perhaps he can clarify.
Mr. McCauley, is it not the case, as you've just stated in an indirect way, that nuclear operators would not be able to get parts for their operations because suppliers would not be willing to take the risk of providing parts? They can't get insurance to cover the parts that would be used in the nuclear facility.
Without this exclusive liability falling on the operator, there'd be no way to function as an operator. Nobody would be willing to give you parts because they could be held partially responsible. They can't get insurance, so they would put their entire operation at risk by providing a single part to an operator. Is that not correct?
4:10 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
That's correct.
4:10 p.m.
Conservative
The Chair Conservative Leon Benoit
Just before we carry on with this, the bells are ringing. There will be a vote at 4:38, I believe. How much time do we need to get over there for the vote? How much time would you like? When would you like me to suspend the meeting? We'll come back after the vote.
4:10 p.m.
A voice
Make it 15 minutes after that.
4:10 p.m.
Conservative
The Chair Conservative Leon Benoit
Okay. We have a few minutes until then.
We'll go back to Mr. Cullen on clause 12.
4:10 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
I'm trying to figure out the chicken and the egg in terms of nuclear liability. What comes first?
One of the questions we had for witnesses was about the notion of whether the industry can exist without these types of restrictive and exclusive insurance schemes. The answer was no, because from the get-go in the event of a nuclear accident, the costs are so extreme in terms of liability and compensation. They're so big that the notion of an individual company or a parts supplier, as Mr. Hiebert has said, having enough insurance to cover off that eventuality makes it an impossible industry to....
Under normal circumstances, the government wouldn't get so involved in an industry's insurance scheme. We don't do it for auto. We don't do it for other forms of energy, not that I'm aware of, anyway. I don't know of any other legislation we deal with at the natural resources committee....
4:10 p.m.
A voice
[Inaudible--Editor]
4:10 p.m.
Liberal
Geoff Regan Liberal Halifax West, NS
Strict liability provisions exist under...[Inaudible--Editor]...laws.
4:10 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
Okay. So I guess my specific question, then, is whether it is because of the size of the potential compensation that we've set up an exclusivity regime that then allows the nuclear industry to exist, and without it we couldn't, only because the liability is so large and potentially diverse. Am I reading this right?