No Nuclear Renaissance in a Recession?

What effect will today’s bad economy have on the nuclear renaissance?

As I see it, any Canadian politician that wants to fund a nuclear Megaproject (actually Gigaproject) in a time of severe recession is going to have a very tough time selling it as part of an economic stimulus package. Rhetoric about ‘building for the future’ or ‘just carrying out plans already made” simply isn’t going to cut it with the public.  Of course, the Tennessee Valley Authority and the Hoover Dam are examples of massive US energy projects built during the Great Depression of the 1930’s. However, I think the public perception of nuclear reactors is very different; they don’t have the same image as hard core infrastructure projects that employ large numbers of people. Roads, bridges, water mains, parks, public transit and so forth directly relate much more closely to people’s lives and thus, are a “politically better” use of the large but limited construction capacity in the province.

In Ontario, a multi-billion dollar nuclear project at Darlington doesn’t have the same political attraction as many smaller infrastructure projects spread all the province. Additional new reactors at Bruce and Nanticoke would increase the total costs to the province so much as to counteract any benefits they might bring in terms of geographical spread. The timing of that idea wouldn’t work in any case since these projects are not likely to begin until well after the new Darlington reactors. One could try to spin a single project at Darlington by correctly pointing out that many components would be built in other areas and in many ways the project benefits the whole province.  Nevertheless, justifying the construction of even two new reactors at a total of $10-15 billion would be a very hard sell when compared to the $1.3 billion provincial contribution to the recent Big Three automotive bail out. In fact, the optics is so bad that I doubt any smart politician would even attempt it in a failing economy.

In Alberta the precipitous drop in the price of oil has knocked the bottom out of any idea of building reactors there. The huge oil sands projects that would be very profitable with oil at $140 a barrel are marginal at $40 a barrel and the overheated Alberta economy is cooling fast. I very much doubt that Alberta politicians are going to push new reactors as a cure to the province’s economic problems. My guess is the thinking in Saskatchewan would be similar.

New Brunswick is the exception. We can only assume that news of the recession hasn’t reached there. Recently, the government announced they were going to build not one but two new reactors (ACR-1000s?) A mode of bullish optimism prevails (‘I’ll have what he’s having”) It is said that the new reactors will supply the New England electricity market assumed to be expanding in spite of the current US economic problems. However, as far as I know, the studies (one of them from AECL) justifying this strategy have never seen the public light of day and therefore, we don’t know what the provincial government is really thinking. I suppose New Brunswick is also assuming that the federal government via AECL will back stop the large cost overruns inevitable on first-of-a kind projects.  The feds, however, are already unhappy about running a deficit and I frankly can’t see them being any happier in absorbing New Brunswick’s cost overruns. Of course, if the feds agreed to that , they’d also have to do it for Ontario’s reactor overruns.

My fearless but realistic prediction is that the nuclear industry like every other will have to hunker down and ride out the storm until the economy improves. Certainly routine activities will continue at a dull roar probably including some refurbishment but I can’t see any new-build Gigaproject start-ups. In other words, the nuclear renaissance will be on hold during the years of the recession/depression the world is now experiencing.  Let’s hope for everyone’s sake it will be a short downturn.


3 Responses to “No Nuclear Renaissance in a Recession?”

  1. Don Jones Says:

    It’s not a matter of jobs for the boys. With the 2,000 MW at Pickering B (and the 1,000 MW at electrically connected Pickering A) likely to soon disappear plus the uncertainty surrounding refurbishment at Bruce B, new build is essential. Remember coal-fired generation is being phased out and baseload gas would be prohibitively expensive. Money has to be spent to keep the lights on and we get the jobs that go with that

  2. Neil Alexander Says:

    Once again a pertinent analysis but missing one critica point.

    When we do small infrastucture projects where something is constructed that either does not use technology or does not use Canadian owned technology then at the end of the project the employment opportunities vanish.

    If we build an ACR our manufacturers and service providers develop valuable expertise that will allow them to continue to prosper after the project ends. On top of the that we also successfully commercialise the ACR which could indeed lead to siginificant sales in a burgeoning market.

    In these troubled times we need to build for a viable future. Building an ACR does just that. The ability of the industry to build on the “knowledge economy” whilst also creating shopfloor work should be seen as a priority by both the Province and the Nation.

    Neil Alexander
    Organisation of CANDU Industries

  3. Dr Singh Says:

    ACR is significantly behind the pack. Its ridiculous to imagine any ACR without serious federal backing (as article states).

    I doubt reactor choice will be made this year if recession continues. By that time, other designs will be already mid-construction or even 10+ years (ABWR).

    The biggest issue though is, what happens if indeed 2 ACR are approved today. The design isn’t finished, so cant start construction. And ofcourse no comfort in teething problems already worked out in first builds elsewhere.

    Finally, there are the design “improvements’. Slightly enriched U will require import of fuel or building of new fuel facility. You still have the (costly) mid life refurbishment. And ofcourse, like other Gen3 reactors, outlet temp is insufficient for real hydrogen production, desalinization or other industrial use. AECL is quick to hype the advantage of CANDU being able to use MOX or Thorium but it hasn’t really happened yet. Finally, in the end you are still left with large volume of relatively modest radioactive fuel waste CANDU is known for.

    Should AECL seriously invest in fast breeder molten salt reactor like Liquid Fluoride Thorium Reactor (LFTR), it would allow 20-30 year operation with little or no additional fuel (breeder reactor that creates more fuel), and doesnt require high pressure tubes or vessel. We could have demo and commercial plants by ’16 and ’20 (conservatively)

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: