Ontario’s firm commitment to nuclear power through a multi-decade agreement with Bruce Power announced this month could not have come at a better time.
Nuclear power, a low carbon energy source, is a trump card Ontario will carry into future phases of climate change discussions as Canada develops ambitious targets to reduce greenhouse gas emissions.
The global context sets the stage for an urgent need to address the changing climate. Commitment to nuclear is one part of the answer to this challenge.
Obvious questions do arise: how about the cost of nuclear in relation to other options? What about safety, risk and reliability?
The price tag for the Bruce agreement is about as low as it gets, with power delivered at $65 per megawatt hour in 2016 and an average price of $77 per megawatt hour over the life of the contract; the electricity price is about 30 per cent lower than the Ontario average. The scale and the size of the commitment to nuclear in the agreement – 6300 megawatts of baseload generating capacity with a $13 billion private sector investment – bodes well for confidence in the province’s electricity sector.
This will provide much needed price stability in the short term and also act as a powerful shock absorber to future price increases in the Ontario electricity market. The Bruce Power nuclear agreement will also deliver annual economic benefits in the order of $6 billion per year, accompanied by significant job creation potential over the long term.
What about the environment and costs related to high-level waste disposal of used fuel and decommissioning of the nuclear plant?
All the costs associated with high-level waste management and decommissioning of reactors at the end of useful life are included in the price of nuclear energy charged to current customers. As required by the Canadian Nuclear Fuel Waste Act, funds to cover the full cost of the safe long-term management of nuclear waste must be set aside in a trust fund by the major producers of the waste. Under the act, the funds are regularly reviewed and if they are judged insufficient, more money must be set aside. The premise underlying the intent of the Act is simple – benefits to present generation must not create an undue liability for future generations.
The Canadian Nuclear Safety Commission regulates nuclear operations and all the costs of safety embedded in the design and operation of the facilities are included in the cost of energy. The commission is also responsible for implementing Canada's international commitments on the peaceful use of nuclear energy. A strong independent regulator, with a clear mandate, reporting directly to Parliament provides the necessary confidence that use of nuclear energy will remain safe. The safety record of Canada’s nuclear industry is a testament not only to the robust framework for nuclear regulation but also the commitment of nuclear operators to safety.
The legacy of fossil fuel generation is remarkably different. For a century and a half, fossil fuels have played a central role in underpinning global economic well-being. But its use has brought us to an environmental conundrum that threatens the climate on a planetary scale. In sharp contrast to nuclear costs, the cost of fossil fuel generation does not include any penalty for greenhouse gas emissions. Thus, investments in other forms of generation without carbon emissions – wind, solar, hydro, nuclear – are often at a disadvantage.
Without a viable alternative to fossil fuels, governments will be under incredible pressure to power the modern global economy while meeting climate change targets. The intermittent availability of renewable generation –wind and solar – imposes a requirement for storage. The declining cost of renewable energy with cost-effective storage on a large scale holds promise for the future. These resources combined with hydro and nuclear emerge as a comprehensive answer to meeting the ambitious climate change goals.
To suggest we obtain all our electricity from renewables is unrealistic because of their intermittent nature and because suitable energy storage technology has yet to be developed. Ontario needs a balanced system made up of different forms of electricity generation, including nuclear. A balanced energy mix will give the province the best overall outcome: low cost energy and superior environmental performance.
Nuclear energy as developed and managed in Canada is clean, abundant, safe, and has the mechanisms in place to deal with inter-generational cost burdens associated with its waste. Ontarians should welcome having nuclear as part of their energy mix for decades to come.
Jatin Nathwani is professor, Ontario research chair and executive director of the Waterloo Institute for Sustainable Energy at the University of Waterloo.
Read More: Why Ontario shouldn’t go nuclear
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