Natural Resources Committee on Dec. 13th, 2016

[Brett Plummer]

It's neither a design issue nor a construction issue. The CANDU 6 is a very robust design. It has a lot of redundancy built into the design. This has to do with going through refurbishment and focusing on refurbishment [Inaudible—Editor] reactor.

Coming out of refurbishment, the focus was on meeting regulatory requirements post-refurbishment. This had to do with making sure that we made the Fukushima upgrades, and that we upgraded our fire systems.

Then we realized that we needed to make sure that we met the latest industry standards on equipment reliability. That's why we've turned our focus on this aggressive preventive maintenance to make the plant more reliable.

[John Barlow, Conservative, Foothills, AB]

One of the biggest things that we've heard from almost all of our witnesses through this study is the perception by the public about the safety of nuclear energy. Is this something that you have to face in New Brunswick as well when these breakdowns happen? I'm assuming that public safety's never been at risk, but is this something that you have to be fairly proactive with in terms of getting that message out there when you are doing refurbishment or addressing other maintenance issues? Public safety is always paramount, and I'm assuming that you do have a plan in place in terms of public consultation.

[Brett Plummer]

Yes. Public safety is our number one principle. It's our guiding principle for running nuclear power plants, as I'm sure you've heard from other individuals who have testified. We do not get to run a nuclear power plant unless it is our number one goal. We have several oversight agencies, whether it be the regulator, the CNSC, or WANO, the World Association of Nuclear Operators. We have a tremendous amount of defence and depth to ensure that we run these plants safely and that we continuously learn and improve and make the plants better.

With that said, we need to make sure that we continuously engage in communicating with the first nations, the community, and the province on where we are. We run a very transparent operation, and it's evident. We share information continuously with the first nations, the community, and our stakeholders.

[John Barlow, Conservative, Foothills, AB]

One of the goals of this study is to see what the future of nuclear energy in Canada is going to be. We certainly have some concerns in terms of, again, that public perception.

With everything that you've gone through, Mr. Plummer, in terms of your experience with the people of New Brunswick, do you feel that we can have a public awareness campaign that would allow another nuclear facility to be built somewhere in Canada?

[Brett Plummer]

From the surveys I've seen in New Brunswick for this province, the overwhelming majority approve of Point Lepreau and nuclear power, so I do think there is a case to make for nuclear power in this province and in Canada overall.

[John Barlow, Conservative, Foothills, AB]

Great. Thank you very much.

[The Chair, Liberal, James Maloney]

Mr. Cannings.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Thanks to our witnesses for being here. I'm glad to see you're both back online.

I'm going to start with Mr. Plummer and talk about some of the price issues around nuclear. By my calculations, Point Lepreau makes up somewhere between one-quarter and one-sixth of New Brunswick's power. Is that correct?

[Brett Plummer]

It's approximately a third.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

You listed them off, but I just wondered what the makeup is of the other two-thirds. What are the price points on the power they generate?

[Brett Plummer]

I'll just talk a little bit about the energy mix, but as far as the price points go, in order to get you a very accurate answer, I'd like the opportunity to respond with a follow-up brief, if we could.

On the energy mix, we have a very diverse system in New Brunswick. We have nuclear, coal, oil, solar, wind, and hydro. Depending upon the time of year and depending upon the cost, it depends on which generation is put onto the grid and whether we export energy or we import energy. It changes at any given time. To get the exact cost of the different generations at different times within the season, I think I'd rather follow up and give you a proper answer with a brief.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Getting into a little more detail on the refurbishment of Point Lepreau, I'm just wondering about the costs of that. I have an article here, I think from the CBC, that suggests there was quite a bit of overrun, that the costs could hit $3.3 billion.

I just wondered how the cost overrun affects the overall price for that power. Who's shouldering the cost for this overrun? How much is shouldered by the federal taxpayer?

[Brett Plummer]

In terms of the refurbishment cost, the overruns were $1.4 billion. The energy replacement cost was $1 billion. Those costs are incorporated into the price of Point Lepreau over the life of the plant. The cost of the life of the plant is still 8.3¢ per kilowatt, which is extremely competitive.

In terms of discussion beyond that, this is still a court case, and I'm not allowed to discuss it in any more detail as far as the pending lawsuit is concerned and how that's going to be resolved.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Is this a lawsuit between NB Power and the federal government?

[Brett Plummer]

Yes. The previous vendor that did the refurbishment at that time was owned by the government.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Moving on, you mentioned the plan that you're developing with regard to future power in New Brunswick, and you mentioned consultations with indigenous governments. I'm just wondering what approaches you have taken in those consultations, and how far along they are.

[Brett Plummer]

As far as the community interface with the first nations goes, I think I'd like to pass that on to Kathleen Duguay, who's there in the House of Commons, to speak to.

[Kathleen Duguay, Manager, Community Affairs and Nuclear Regulatory Protocol, New Brunswick Power Corporation]

Consultation and engagement are ongoing and have been ongoing with first nations and local communities. In terms of the specifics of this project, we have a first nations organization at NB Power, and we first engage and get their ideas and their input. It's an ongoing process. Since the plant is still developing, we're still engaging every day. We're engaging with the first nations of New Brunswick. We have our first nations organization at NB Power, and it's an ongoing process.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Finally, moving on to waste management for NB Power, what are the plans for the storage of that waste, and how does it compare to that in other jurisdictions?

[Brett Plummer]

Presently we've been storing our waste on-site since we started generating waste. It has been safely managed and stored, and I think as an industry as a whole, we've been extremely responsible with regard to storing nuclear waste. There is a nuclear waste fund. Basically, the Nuclear Fuel Waste Act in 2002 created the Nuclear Waste Management Organization. We've been working directly with the Nuclear Waste Management Organization to come up with a long-term solution for the waste. As far as the funding goes, presently there's $138 million in a trust fund to address the waste. NB Power specifically has contributed approximately $10 million.

In the long run, through the Nuclear Waste Management Organization, we'll collaborate with our nuclear partners as well as all our stakeholders, including first nations communities, the Province of New Brunswick, and the federal government to determine for low-level, intermediate-level, and high-level fuel waste, what the long-term solution will be.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Thank you.

[The Chair, Liberal, James Maloney]

Thank you, Mr. Cannings.

Now it's Mr. Harvey.

[TJ Harvey, Liberal, Tobique—Mactaquac, NB]

First of all, Mr. Plummer, I was wondering if we could talk a little more about the cost overruns associated with Lepreau, because last week we heard from Greenpeace. They were here, and they referenced the cost overruns associated with Lepreau, but I believe, and I referenced this last week, that they misrepresented the facts in terms of cost overruns.

I just want to see if your recollection of the current state reflects what I believe to be true, which is that at this point there has been zero cost burden placed on the federal government associated with the overruns from Lepreau, but there are two ongoing lawsuits, one on behalf of NB Power and one on behalf of AECL, against the insurance company. There was a half-billion dollar policy issued at the beginning of the refurbishment for Lepreau. I think the two amounts are $204 million on behalf of AECL and $320 million on behalf of NB Power. There has been no movement between the federal government and the provincial government regarding this because there is an ongoing lawsuit, but it isn't directly in relation to the federal government at this point.

Is that reflective of what you believe?

[Brett Plummer]

Again, I'm not directly or personally involved in the lawsuit. It is going through the courts. At this time I've been asked not to comment anymore on the potential outcome of that lawsuit.

[TJ Harvey, Liberal, Tobique—Mactaquac, NB]

Thank you very much for that.

In terms of transition, as we try to transition and reposition ourselves as a cleaner, greener economy, with the outcomes that NB Power has committed to by 2020, and with where NB Power plans to be by 2030 and 2040, can you comment on the importance of Point Lepreau to the overall picture of clean generation in New Brunswick? As we transition away from coal, Belledune is set to sunset in 2040. There's some talk around the possibility of it sunsetting in 2030 and the significant role Point Lepreau could play in helping that transition as we try to move away from coal generation.

Perhaps you could reflect your thoughts, just quickly, on the idea of a Lepreau two. I know that when the site was originally built, it was engineered and approved as a site for two reactors. What are your thoughts on that? I'm not looking for a yes or no, but just for your thoughts in general on the idea of a Lepreau two and the possibility that it could help ease our transition away from coal in New Brunswick by 2040, or even 2030.