Strong domestic supply chain an advantage as Canada moves ahead with new nuclear: Sasha Istvan for Inside Policy

By Sasha Istvan, February 5, 2024

The pledge from 22 countries, including Canada, to collectively triple nuclear capacity by 2050 drew cheers and raised eyebrows at the United Nations Climate Change Conference last fall in Dubai. Climate commitments are no stranger to bold claims. So, the question remains, can it be done?

In Canada, we are well on our way with successful and ongoing refurbishments of Ontario’s existing nuclear fleet and planning for the development of small modular reactors, or SMRs, in Ontario, New Brunswick, Saskatchewan and most recently Alberta.

The infrastructure required to generate nuclear energy is significant. You not only need engineers and technicians working at a plant, but the supply chain to support it.

Over five decades worth of nuclear generation has allowed Canada to build a world class supply chain. Thus far it has focused on servicing CANDU reactors, but now we have the potential to expand into SMRs.

I first became interested in the CANDU reactor after working as a manufacturing engineer for one of the major fuel and tooling suppliers of Ontario Power Generation and Bruce Power. I witnessed firsthand the sophistication and quality of the nuclear supply chain in Ontario, being particularly impressed by the technical expertise and skilled workers in the industry.

The CANDU reactor is the unsung hero of the Canadian energy industry: one of the world’s safest nuclear reactors, exported around the world, and producing around 60 per cent of Ontario’s electricity, as well as 40 per cent of New Brunswick’s.

Having visited machine shops across Ontario, it’s evident that Canadians should take pride that the expertise and technology required for the safe generation of nuclear energy is available here in Canada.

As Canada looks to grow its nuclear output to achieve net-zero goals, its well-established engineering and manufacturing capabilities can make it a leader in the global expansion of nuclear energy as other nations work to make their COP28 declaration a reality.

Canada has two major advantages. The first is that it is a globally significant producer of uranium. We already export uranium from our incredible reserves in northern Saskatchewan and fabricate unenriched uranium fuel for CANDU. Canadian uranium will be an important ingredient in the success and sustainability of a nuclear renaissance, especially for our allies.

The second is that we have an established and active supply chain. While new nuclear builds have slowed dramatically in the western world — a result of the fallout from Chernobyl and Fukushima, as well as competition from cheap natural gas — Bruce Power and OPG are in the midst of major refurbishments to extend their operations until 2064 and 2055, respectively.

Bruce Power has successfully completed the first unit refurbishment on schedule and within budget, with ongoing work on the second unit. OPG has accomplished refurbishments for two out of its four units at Darlington, with the latest unit completed ahead of schedule and under budget. These multibillion-dollar refurbishments have actually grown our nuclear supply chain and demonstrate that it’s firing on all cylinders.

SMRs are the next phase of nuclear technology. Their size and design make them well suited for high production and modular construction. Investing in the supply chain for SMRs now positions Canada for significant economic gains.

OPG plans to build four GE-Hitachi BWRX-300 reactors, with the first slated for service as early as 2028. This first-of-a-kind investment will help identify and overcome design challenges and develop its own supply chain. That will benefit not only their project but those that follow suit.

SaskPower is planning to proceed with the same SMR design, as well as the first pilot globally of the Westinghouse eVinci microreactor; New Brunswick is moving ahead with the ARC-100, both for its existing nuclear site at Point Lepreau as well as in the Port of Belledune; and OPG and Capital Power recently announced a partnership to explore a nuclear reactor in Alberta, including the potential for the BWRX-300.

While the bulk of the nuclear supply chain is currently located in Ontario, other provinces have already been investing in the development of local capacity.

All this activity sets Canada up to leverage first-mover advantage and become a significant global provider of BWRX-300 components. Canada will not only see the economic benefits during initial construction but also through sustained demand for replacement parts in the future.

Nuclear energy has already made a significant contribution to the Canadian economy. In 2019, a study commissioned by the Canadian Nuclear Association and the Organization of Canadian Nuclear Industries showed that the nuclear industry accounted for $17 billion of Canada’s annual GDP annually and has created over 76,000 jobs.

Notably, 89 per cent of these positions were classified as high-skilled, and over 40 per cent of the workforce was under 40. This study, conducted before the announcement of SMR plans, was followed by a more recent report from the Conference Board of Canada on the economic impact of OPG’s SMR initiatives. The study found that the construction of just four SMRs at OPG could boost the Canadian GDP by $15.3 billion (2019 dollars) over 65 years and sustain approximately 2,000 jobs annually during that period.

Public perception of nuclear is improving. In 2023, the percentage of Canadians wanting to see further development of nuclear power generation in Canada grew to 57 per cent compared with 51 per cent in 2021.

As well, the Business Council of Canada has voiced its support for nuclear expansion, emphasizing Canada’s strategic advantages: political and public backing across the spectrum, coupled with a rich history of nuclear expertise.

Nuclear energy is dispatchable, sustainable and a proven technology. As nations move to achieve their climate goals, it has one other major benefit: a supply chain that is wholly western and in Canada’s case almost totally domestic.

While the critical minerals and manufactured goods required for batteries, wind and solar energy rely heavily on China and other politically unstable or authoritarian countries, nuclear provides energy independence. Canada is well positioned to help our allies improve their energy security with our strong, competitive nuclear supply chain.

Sasha Istvan is an engineer based in Calgary, with experience in both the nuclear supply chain and the oil and gas sector.

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