Science and Research Committee on June 2nd, 2022

[Ryan Williams, Conservative, Bay of Quinte, ON]

I'm sorry. I'm just going to cut you off. If there's anything else, don't hesitate to submit it in writing. I have only 30 seconds left.

My last question is about the short term. Mr. Hartwick, you can submit this in writing, too. When we look at needing two to five times the energy, and when we see the addition of electric cars coming into our grids, first, can we handle that within a five-year period? This is in the short term.

Second, if we can't, how do we see this from an energy generation standpoint? What does the government need to help with in the short term to ensure that we can add the energy we need as quickly as we can?

I'm out of time, so please submit those answers in writing.

Madam Chair, thank you, as always.

[The Chair, Liberal, Kirsty Duncan]

Mr. Williams, I appreciate that you ended it in that way, in asking for the written answer. Thank you.

With that, we will now go to Ms. Bradford for five minutes.

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

I'm going to address these questions to both Mr. Plummer and Mr. Rencheck. I'd like to hear from each of you.

We'll start with the first question, for Mr. Plummer.

Does your organization partner with any post-secondary or research institutions to improve SMR technologies?

[Brett Plummer]

Yes, we do. We are looking ahead at what we're going to need for skills and labour. We presently partner with the University of New Brunswick. We partner with the Canadian Nuclear Laboratories in Chalk River. We also partner locally with New Brunswick community colleges to make sure we understand the curriculum we'll need going forward for the skills that folks will need to operate these plants and the research and development that we'll need to develop these reactors.

We have multiple partnerships and also memos of understanding, to the point where, honestly, the nuclear program at the University of New Brunswick has actually doubled. As Mr. Rencheck was saying, there's a tremendous interest from young folks in the new small modular reactors that we're developing. We've seen a doubling with the enrolment at that university.

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

That was a lengthy answer.

Mr. Rencheck, does Bruce Power partner with post-secondary research institutions?

[Michael Rencheck]

Yes, and I won't repeat all the names that Brett just mentioned.

The answer is yes. We also do that through the CANDU Owners Group for technologies and our Nuclear Innovation Institute, where we're creating the next generation of nuclear.

We're partnering with other companies and with universities in trying to advance this technology.

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

What shortfalls in SMR technology can further research help overcome?

Mr. Rencheck.

[Michael Rencheck]

First, just moving through the design process in a solid and effective manner would enable us to enter the licensing and permitting processes very quickly. Also, there is performing some of the work around advanced fuels that is occurring. Sharing that R and D technology across the border between Canada and the United States through different organizations will get us the best technology that will be fastest to address climate change.

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

Mr. Plummer, does your organization support any scientific research through private funding, providing access to resources or offering professional insights?

[Brett Plummer]

If you're asking if we invest, basically, in private entities that are doing research for the small modular reactors, we do.

Presently, at this early stage, it's mostly related to environmental studies on site that are associated with small modular reactors, and doing baseline studies.

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

How about you, Mr. Rencheck?

[Michael Rencheck]

We invested particularly in looking at the climate effects on the Great Lakes and the environment, and how that would factor into clean energy going forward. That also set the stage for entering the licensing process and environmental permitting process.

We also do a lot of technology work through the CANDU Owners Group and Canadian national labs on nuclear technology and advancing that. These technologies are similar to technologies that will be used in small modular reactors.

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

How can the scientific community best support the evolution of SMR technology? What would be the best thing it could do? How could it get the most bang for its buck? What would be the most effective research area it could be focusing on?

[Brett Plummer]

There needs to be continued work on advanced modularization or advanced manufacturing technology to make sure we can develop these reactors at the scale we've been discussing and with the quality we've been discussing, and to meet the demand, essentially, for decarbonization.

I believe, as well, that, as Mr. Rencheck mentioned earlier, advanced fuels is an area that we need to continue to work on, especially with the capacity and capability within Canada.

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

My time is up. Thank you, both.

[The Chair, Liberal, Kirsty Duncan]

Thank you, Ms. Bradford, and thank you for being so succinct.

We will now go to Monsieur Blanchette-Joncas for two and a half minutes.

[Maxime Blanchette-Joncas, Bloc, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Thank you very much, Madam Chair.

Mr. Rencheck, I understand that Bruce Power is the only private company operating a nuclear power plant in Canada and that you are also analyzing the possibility of building small modular reactors. However, some experts are questioning the economic viability of small modular reactors.

Have you estimated the cost, in dollars per megawatt hour, of various small modular reactor projects by comparing it with the cost of existing electricity production technologies?

[Michael Rencheck]

I had a very hard time hearing the translation, but I will answer the question I believe I heard.

Quite frankly, in the construction of large projects, like any project, including hydro projects or other large infrastructure projects, we have to be able to advance the design of the project first and ensure that we have an adequate supply chain. As we do that, we're then able to construct the projects in a timely manner and meet schedule and budget. This condition is predicated on having advanced designs. I think this is where the support needs to come in from the government, to be able to flesh out these designs and get them to a point at which we can buy the materials here in Canada, from our supply chain, and build.

If you look at the overall cost per megawatt hour and look at what exists right now in Ontario, it's quite telling. According to the Ontario Energy Board, today the cost of hydro power is about 6¢, the cost of nuclear is about 9¢, wind is about 15¢ a kilowatt hour, gas is about 15¢ a kilowatt hour and solar is about 49¢ a kilowatt hour. That pricing exists in an electrical grid that has deeply decarbonized. Deep decarbonization is believed to be below the 50 grams equivalent of CO2 per kilowatt hour, and Ontario is presently at 35 grams. We have a good footprint. We have a good plan and a good road map to do that.

We're very similar to Nordic countries with the type of hydro production we have. Ontario's grid is 60% nuclear, 25% hydro and about 8% to 10% renewables, with the rest powered by gas and other entities. To create a clean grid that has the capability of powering an economy, and to get to reasonable cost targets per megawatt hour, I think building it out along those lines will be necessary.

[The Chair, Liberal, Kirsty Duncan]

Thank you, Mr. Rencheck.

Thank you, Mr. Blanchette‑Joncas.

We will go to Mr. Cannings for two and a half minutes, please.

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

Thanks. I will continue with that question, and either Mr. Plummer or Mr. Rencheck can answer.

I would echo these concerns about cost. The government is putting considerable funds into this technology right now. I think New Brunswick was in for $86 million over the last few years. I wanted to know more about the timeline. We hear that it will be cheaper energy, because we'll be building it in factories. How many units are we going to have to build before we get to a place where SMRs are cost competitive with wind, solar, hydro and even conventional nuclear? The latter has a real history of cost overruns and expensive power up front. Those solar and wind prices you quoted are much higher than they are elsewhere in the world. I don't want to go down that rabbit hole.

What is the business case for this? How many years will it be? We know the first ones will roll off and be built in 8, 10 or 15 years. How many years will it be before we get to the production levels that will bring those costs down to make it worthwhile?

[Brett Plummer]

It really comes down to how well we're supported and how well we're prepared to do the nth of a kind. If we're prepared to do the nth of a kind shortly after the first of a kind.... These are not conventional reactors. They're small modular reactors. If we take all the lessons learned and have advanced manufacturing, we believe we can recoup our money very quickly as far as getting the cost down from the first of a kind to the nth of a kind.

The other thing to remember about nuclear is that we're not talking 10-20 years. A nuclear power plant, even a small modular reactor, has a lifespan of 60-80 years. When you stabilize the cost at under 10¢ a kilowatt hour, which is what we're projecting with very early initial estimates, and you estimate that cost over that lifespan, it's very economical.

[The Chair, Liberal, Kirsty Duncan]

Thank you, Mr. Cannings.

To all our witnesses, first of all, we are very grateful that you took your time and provided us with your expertise. I'd like to apologize to Mr. Hartwick. To come and to be gracious, and to sit through and not have an opportunity to speak.... I'm very sorry. I'll remind our committee that we can invite him back, and he can also submit a brief.

It's a new committee, and you have a very interested committee. I thank you all, and we will briefly suspend before our third panel.

[The Chair, Liberal, Kirsty Duncan]

I am calling all of you back to order.

We are at our third and final panel of the evening. I'd like to welcome all our witnesses. We appreciate your joining us. It's an inaugural committee on science and research. We look forward to hearing what you have to say.

From SaskPower, we have Troy King, acting president and chief executive officer; from Electricity Canada we have Francis Bradley, president and chief executive officer; and from Global First Power, we have Jos Diening, managing director.

Welcome to all.

Each of you will have five minutes to speak. At the four and a half minute mark, I will raise a yellow card to let you know you have 30 seconds left. We aim to be fair.

Again, we welcome you, and we look forward to hearing from you.

We'll begin with Troy King, for five minutes.

[Troy King, Acting President and Chief Executive Officer, SaskPower]

Thank you, and good evening.

My name is Troy King, and I'm the acting president and CEO of SaskPower.

SaskPower is working toward a future with net-zero greenhouse gas emissions while continuing to provide safe, reliable and cost-effective power to our customers. We are currently on track to have renewables make up 50% of our generation capacity by 2030, resulting in a 50% reduction in our greenhouse gas emissions from 2005 levels.

To get there, we are making significant investments in a large portfolio of renewables and other generation sources. In fact, by 2035 we expect to rebuild 75% of our existing generation fleet, a system that took 93 years to build. While important, we cannot rely on renewable generation alone. Wind and solar are intermittent sources that are available only when there is adequate wind or sunlight. We also need reliable baseload power available all the time, regardless of conditions.

Currently, the bulk of baseload power generation in Saskatchewan is provided by fossil fuels. With the federally mandated retirement of nearly 1,400 megawatts of conventional coal-fired generation by 2030, there will be a clear gap in our ability to provide reliable baseload power.

In some provinces, baseload power is largely provided by hydroelectric generation; however, Saskatchewan doesn't have the geography to support abundant hydroelectric generation, and the options available to Saskatchewan for non-emitting baseload power are limited. SaskPower is considering a number of options to fill this baseload need, including natural gas, carbon capture technology, geothermal, and nuclear power from small modular reactors, or SMRs.

With the exception of traditional natural gas generation, the other baseload generation options available to Saskatchewan have not been proven at a commercial scale. This means that SaskPower will need to take risks in adopting one of these emerging technologies.

We believe nuclear power from SMRs has the best potential for success in the near future and will fit into Saskatchewan's future power mix of non-emitting generation. That mix is expected to include existing hydro, wind, solar, import, biomass, geothermal and potentially carbon capture technologies, as well as traditional natural gas generation required to back up intermittent renewables and provide peaking services.

In order to enable an emerging technology like SMRs to be a reality in Saskatchewan by the 2030s, we have already engaged in a multi-year planning and regulatory project to potentially bring SMRs to the province. SMRs are expected to play a critical role in the fight against climate change, both through enabling electrical utilities to generate reliably and safely without emissions, and also in the innovative application of advanced reactor designs to assist in decarbonizing various industries.

For the past number of years, SaskPower has collaborated with Ontario Power Generation, Bruce Power and NB Power to evaluate the potential for a pan-Canadian deployment of small modular reactors. By working with this group, we're able to leverage the breadth of experience and knowledge they bring when it comes to nuclear innovation, operating nuclear facilities and managing nuclear waste.

Our decision whether to construct an SMR won't be made until 2029, but we must make significant investments to advance our planning work in order to inform and enable that decision.

In addition to providing stable, safe, emissions-free power, SMRs bring potential for significant economic spinoffs for both Saskatchewan and Canada as a whole, including supply chain opportunities, good-paying jobs, opportunities for economic reconciliation with indigenous peoples, and investments into education and training programs.

SaskPower and the other provincial partners are clearly doing their part to advance SMR technology to provide a solution to meet carbon reduction emission goals; however, we believe the Government of Canada has an important role to play as well.

First, the federal government can share the risk of advancing innovative, first of a kind SMR projects by sharing in the development phase costs. The utilities have already proposed a funding plan, and we would encourage members of the standing committee to support it.

Second, regulatory clarity and consistency as we move through the new federal impact assessment process are another high priority.

Timely federal investments to support the development and expansion of the nuclear supply chain to support SMR deployment across Canada are also very important. Federal investment is also required in nuclear R and D and training, especially in jurisdictions new to nuclear power, such as Saskatchewan.

The move to a net-zero future in the electricity industry will be a substantially larger lift in Saskatchewan than in other jurisdictions in Canada that already have significant legacy hydro resources. The lift will require not only taking on significant risk in new technology development but also making significant financial investments.

SaskPower will be looking to the federal government to share in that financial investment needed to make this shift, including the construction of SMRs in Saskatchewan, with the goal of ensuring that the future cost of electricity is competitive in all regions across Canada.

Thank you for your time. I will be pleased to answer any questions you may have.

[The Chair, Liberal, Kirsty Duncan]

Thank you very much, Mr. King. We appreciate your being here.

We will now go to Electricity Canada and hear from Francis Bradley for five minutes.