Evidence of meeting #29 for Natural Resources in the 45th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was communities.
A recording is available from Parliament.
Full Professor, School of Political Studies, University of Ottawa, As an Individual
Yes, this is my last paragraph.
Mexico and our four other reliable partners remain firmly committed to the fight against security, while upholding the rule of law. These environments seem more attractive for our natural resource exports.
I obviously recommend that Canada focus its natural resource export efforts on its partners, particularly Mexico and Brazil, by joining multilateral alliances that favour middle powers.
Thank you, Mr. Chair.
Liberal
The Chair Liberal Terry Duguid
Thank you, Professor Doran.
We'll go to Mr. Christidis for five minutes.
George Christidis President and Chief Executive Officer, Canadian Nuclear Association
Thank you very much, Mr. Chair, and good morning to all members of the committee.
It's a privilege to appear before you today on behalf of the Canadian Nuclear Association. For over 60 years, the CNA has been the voice of Canada's nuclear industry. Today we represent over 200 members from coast to coast, from world-leading utilities and multinational mining companies to small suppliers and innovative start-ups. Together we form one of the most advanced nuclear ecosystems in the world.
It is critically important that the nuclear sector is part of any discussion in terms of Canada's future, because this sector is a foundational and strategic national asset. Nuclear energy plays an important role not only in our energy system, but also in our economic competitiveness, long-term energy security and environmental objectives.
This strength is built on what we have here at home. Canada has vast uranium resources, a full end-to-end supply chain, proven reactor technologies, strong research and development capabilities and global leadership in nuclear medicine. We are already demonstrating that strength through successful refurbishments at the Bruce and Darlington nuclear power stations, the next phase at Pickering and the construction of the first small reactors in the G7 at Darlington. They are all foundational to our success.
Canada is showing leadership at a time when interest in nuclear energy is growing globally. This is being driven by the need for reliable clean power, increasing electrification and a renewed focus on energy security. We are seeing strong interest from countries around the world that are looking to partner with Canada on nuclear energy development. This represents a significant opportunity for Canadian companies and for the broader economy.
To realize this opportunity, a coordinated strategic approach will be important, and continued federal leadership will be essential in supporting Canadian nuclear exports. What is needed is a more integrated, long-term approach that connects domestic development with international opportunities.
In the nuclear sector, government-to-government relationships are essential to enabling market access and building long-term partnerships. This includes identifying priority markets and aligning efforts across government and industry, while also taking a long-term approach to market development that supports both immediate export opportunities and the development of new markets over time. It also requires a coordinated approach that brings together government, industry, regulators and academic institutions to support both commercial opportunities and long-term partnerships.
We also want to recognize the important work done already by Export Development Canada and other institutions that support clean energy and major projects. These efforts are important.
As Canada looks to expand nuclear exports, strategic financial support will be important. This includes aligning financial institutions with a broad economic and trade approach to international engagement. Clear, predictable and competitive financing frameworks will help ensure Canadian companies can compete effectively in global markets.
Finally, success internationally is closely linked to our success at home. Continuing to advance domestic projects, supporting investment through tools such as the investment tax credit, improving regulatory efficiency and investing in workforce development will all be important. These efforts help to demonstrate Canada's capabilities and strengthen our position as a reliable partner internationally.
In closing, Canada has a strong foundation to build on. With continued collaboration between government and industry, there's an opportunity to further strengthen Canada's role in the global nuclear sector. The Canadian Nuclear Association is actively working with industry and governments to help identify priority markets and support Canadian engagement internationally.
We will be pleased to provide additional information to this committee.
Thank you, and I look forward to the conversation.
Liberal
The Chair Liberal Terry Duguid
Thank you, Mr. Christidis.
We're moving on, now, to Mr. O'Connell.
The floor is yours for five minutes.
Brendan O'Connell Vice President, Business Development, Hydrogen Canada Corp.
Thank you, Mr. Chair.
My name is Brendan O'Connell. I'm the vice-president of business development at Hydrogen Canada Corp., an Alberta corporation. With me today is Bryan Moon. He's the president of our company.
Hydrogen Canada is looking to build a $3.5-billion world-class blue ammonia and hydrogen facility in western Canada for export to Asia. The company will take advantage of cost-effective natural gas in Canada and the relatively short, safe supply route to Asia in order to provide a secure supply of clean energy to Korea and other Asian countries. Each facility will represent up to $800 million in incremental GDP for Canada and create more than $100,000 direct, indirect and induced man-years of employment in Canada, while the Asian market can supply multiple facilities.
Since 2022, Hydrogen Canada has raised $10 million, bought land in the Alberta heartland and completed its preliminary engineering work. Hydrogen Canada's facility was going to use natural gas to produce low-carbon blue hydrogen, then convert it to liquid ammonia. It would capture more than 96% of its CO2 and sequester it in one of the commercial CCS hubs in western Canada. The liquid ammonia would be shipped to international markets in Asia via Trigon's gateway export facility in Prince Rupert, which is partially owned by local aboriginals.
Hydrogen Canada targeted the Korean market due to its commitment to using hydrogen-ammonia to decarbonize its power sector, the size of that mandated market and the fact that Hydrogen Canada has strong relationships in Korea. The government of Korea has passed legislation requiring the blending of hydrogen and ammonia in its power sector in order to reduce emissions. It has also committed to net zero by 2050. Korea still has approximately 35 gigawatts of coal-fired power, and co-firing ammonia in those plants can significantly reduce their emissions. Korea imports over 84% of its energy every day, so this is as much about clean energy as it is about gigajoules of energy. The legislated demand for hydrogen and ammonia in Korea could reach 16 million tonnes per annum by 2036. Power companies were looking to sign contracts last year.
Hydrogen Canada is in a unique position to supply low-carbon energy to Asia due in part to the low-carbon intensity of Canada's differentiated natural gas. In combination with the company's plant design, Hydrogen Canada can produce hydrogen with the lowest carbon intensity of any facility globally. Hydrogen Canada submitted its process information to a Korean agency two years ago, and that agency issued a preliminary carbon intensity rating of less than one kilogram of CO2 per kilogram of hydrogen, one of the lowest ratings globally.
Hydrogen Canada has spent the last three years developing its project. The company worked with Natural Resources Canada to develop an export strategy for an Alberta-based facility. Hydrogen Canada was recently informed that NRCan deferred plans to support a rail-based export strategy. In January, Hydrogen Canada hosted a major Korean conglomerate looking for energy opportunities in Canada. This company still sees a significant market for clean ammonia developing in South Korea, Japan and Asia more broadly. It is still very interested in supporting the development of facilities in Canada. Hydrogen Canada has since refocused its efforts on a facility based on Canada's west coast.
Hydrogen Canada believes there is still a significant opportunity for Canada to become a global leader in clean energy supplied to Asia. However, Canada needs to respond in the very near term, or the investment will go elsewhere. We need to align federal and provincial policy and ensure that the industry can move forward as soon as possible. The recent events in the Middle East highlight the need for democratic, energy-producing countries like Canada to provide secure clean energy to its global partners.
Thank you.
Liberal
The Chair Liberal Terry Duguid
Thanks to Mr. O'Connell and all the witnesses.
We're going to start our round of questions with Mr. Tochor for six minutes.
Conservative
Corey Tochor Conservative Saskatoon—University, SK
Thanks to the witnesses and the committee members for being here today.
In terms of regulating the nuclear industry in Canada, and the idea of cutting red tape and making regulatory progress on speeding things up, are we on track right now?
President and Chief Executive Officer, Canadian Nuclear Association
This is where the opportunity is. We, the Canadian Nuclear Association, feel that the domestic regulatory environment isn't necessarily reflecting the importance of making sure that the regulatory regime is effective and efficient enough to accelerate the development and deployment of nuclear technologies across this country.
For example, we're seeing an increase in the number of regulatory docs at the Canadian Nuclear Safety Commission. Yes, it is a tier one world regulator that is highly respected and, obviously from an industry perspective, knowledgeable. However, when we look at the regulatory environment in Canada, the trend line doesn't match up with the international trend. You're seeing key countries like the United States, the United Kingdom, France, Finland and other spaces accelerating or reviewing the regulatory requirements to reduce duplication and increase efficiency, certainly when it comes to spaces that have nothing to do with safety.
I'd argue that there is an opportunity here. As the government is looking at how to strengthen the domestic economy and the domestic energy system, and create opportunities internationally, the domestic regulatory regime is really important to look at.
Conservative
Corey Tochor Conservative Saskatoon—University, SK
Talking just a little historically, you said that in the last 10 years, we've gone in the wrong direction. I understand there's 80% more regulation now than there was 10 years ago. Is this true? In one briefing, CNA identified that number.
President and Chief Executive Officer, Canadian Nuclear Association
If you take a look at the regulatory requirements under the CNSC, we've seen a trend over the last 10 years that's actually increased about 80%. Again, those are the types of examples that I think the industry would like—
Conservative
Corey Tochor Conservative Saskatoon—University, SK
That doesn't match up. If we're supposed to move at speeds we've never seen before in Canada, how can it possibly be that the Liberal government has added 80% on this important industry?
President and Chief Executive Officer, Canadian Nuclear Association
We feel that this is the opportunity. You could take a look at the regulatory requirements and reduce duplications that are not related to safety needs—just to stress that.
I'll just reaffirm the important role that the Canadian Nuclear Safety Commission does play, but we feel that the regulatory requirements need to trend in another direction, and there's an opportunity to improve it.
Conservative
Corey Tochor Conservative Saskatoon—University, SK
Maybe I'll give a real-world example for our community to understand how this has hurt us.
Denison Mines in Saskatchewan just got approved. Could you unpack a little bit the timelines that project faced and how that might highlight why we need these changes so much?
President and Chief Executive Officer, Canadian Nuclear Association
Mr. Chair, I could follow up with more specifics in terms of that particular project, but I'll just reiterate the fact that the regulatory environment is such that timelines and meeting timelines are an issue. It's not only for our own industry; it's for a number of industries. It has been our experience overall that there does need to be an increased lens on where you could reduce duplications and increase regulatory efficiency, where you do not hinder anything to do with safety. I'll defer to that.
Conservative
Corey Tochor Conservative Saskatoon—University, SK
I welcome you to put in a submission and a written brief on how that project was stalled and the net results for our Canadian economy.
You spoke about the importance of the value of Canadian natural resources such as uranium. It's a crucial element of the free-world strategy for energy security from hostile foreign powers. How does uranium fit into our position with allies around the world?
President and Chief Executive Officer, Canadian Nuclear Association
Our sector, which includes, of course, Saskatchewan-based uranium, which are some of the best deposits in the world, has been critical in the geopolitical realignment where there's been an effort to replace uranium from other non-allied sources. We've seen a significant increase in markets for a company such as Cameco, for example, which is based in Saskatchewan, in places like eastern Europe, Asia and the United States, where there's an increased need for uranium.
Therefore, there's a wonderful opportunity there for Canadian exports. You saw the Prime Minister and the government recently engage in India, for example. That was a very positive development in terms of the potential for uranium exports.
Along with uranium exports is, of course, the whole Canadian supply chain. Currently, the Canadian supply chain is predominantly CANDU-based. There's just a wonderful opportunity that's associated with export, as a number of different countries, for their own geopolitical, environment and energy security needs, are looking at nuclear technologies both large and small. Canada is really playing a leadership role. We're seeing a lot of interest from eastern Europe—whether it's Poland, where Minister Hodgson has recently been, or Romania—and in Asia, where large and small reactors are possible.
Conservative
Corey Tochor Conservative Saskatoon—University, SK
On all the European countries that you named, and they're all the ones that are NATO allies, has the CNA presented the Liberal government's idea that some of those costs for the nuclear industry, and what we provide to our allies, should be included in our 2% NATO spend?
President and Chief Executive Officer, Canadian Nuclear Association
Yes, that concept has emerged. I must admit I'm not an expert in the definition of NATO contributions, but I do know a number of key members have made that suggestion to the government.
Liberal
Claude Guay Liberal LaSalle—Émard—Verdun, QC
Thank you, Mr. Chair, and I want to thank the witnesses for being with us today.
I'm going to continue a bit on the same topic as Mr. Tochor.
Mr. Christidis, this is for you.
Is the CANDU MONARK the next big platform? This committee is studying export, and we all know about the potential export of uranium, but you were just starting to talk about the potential to export the supply chain of nuclear facilities. Perhaps you could expand first, in dollars if you have them, on the impact of exporting Canadian technology, and the second part is on CANDU MONARK, that kind of thing.
President and Chief Executive Officer, Canadian Nuclear Association
Let me flip it a little bit the other way just to give you the answer.
The world nuclear market is looking to triple. We're seeing that demand increase, actually, in Canada itself as jurisdictions are looking at their own grids here in Canada. Many grids are looking at tripling by 2030, 2050, that time frame.
It's the same story internationally, where the world nuclear market is looking to triple. There's a big conversation in terms of what that could look like. There's a role for large nuclear reactors like those that we have in CANDU, which are based on the refurbishment of OPG, Bruce Power in Ontario, which was about $26 billion, on time and on budget. That's a really strong success story for Canada.
Canada also owns, through Cameco and Brookfield, Westinghouse, the other large energy technology, and Canada's leading through the small module reactor initiative. There are four reactors being built in Ontario by Ontario Power Generation—the GE Hitachi model—which are the same four in Saskatchewan, which are also linked to the opportunities in countries like Poland and beyond.
Across the board, depending on which market segment you're looking at, you're looking at a tripling of that type of market. That doesn't even touch on the uranium side as well as the supplier side. All that to say there's very robust potential growth, but it's really predicated on delivering the projects here in Canada. For us, our sector is really based on domestic success that accelerates international success.
Liberal
Claude Guay Liberal LaSalle—Émard—Verdun, QC
Thank you for that explanation.
Maybe you could enlighten the committee and people who are not so familiar. You went there talking about large nuclear reactors, small modular reactors. We hear about microreactors. What's the status of each one of those markets in terms of potential to export for us?
President and Chief Executive Officer, Canadian Nuclear Association
Some of the technologies are being deployed. The CANDU technology, the Westinghouse technology, the GE Hitachi for the SMR technology, which is about 300 megawatts in size, just to give you a bit of a scope, which is close to some of the coal plants that they tend to replace, those technologies are proceeding.
For the SMR GE Hitachi model, there's a construction site in Ontario now, OPG, which is building these four reactors. Some of the smaller reactors—