Ont. has $26B nuclear decision looming in 2009
Published Saturday, December 27, 2008 2:41PM EST
Ontario has a $26-billion decision to make in 2009 -- Who will construct the province's next generation of nuclear electricity generating plants?
But to answer that key question, one must answer another: In a time of economic recession, should a priority be put on a bidder who will maximize the number of jobs in Ontario?
Three vendors are seeking the contract:
- Westinghouse Electric Co., a U.S. nuclear giant
- AREVA NP, a French company
- Atomic Energy of Canada Ltd.
Ontario announced the following criteria when it announced its plans for more nuclear energy in mid-June:
- Lifetime cost of power
- Ability to meet Ontario's timetable to bring new supply on line in 2018
- Level of investment in Ontario
A wild card is that AECL wants to sell Ontario a new breed of reactor, one that hasn't been tried anywhere in the world.
Critics of that proposal fret that the cost overruns could prove to be astronomical.
"The McGuinty government says $26 billion. You talk to people out there, they say start thinking in terms of $50 billion or $60 billion in terms of the final cost. So very expensive power," said NDP Leader Howard Hampton, who has written a book on nuclear energy.
Both Westinghouse and AREVA have proven technologies, which means more predictable costs, but much of the engineering and development work would be done in either the United States or France.
AECL would provide more jobs for Canadians.
"The stimulative effective of building a nuclear power plant is really quite extraordinary," Energy and Infrastructure Minister George Smitherman told CTV Toronto. "I think that the message there about investing in domestic infrastructure with a domestic company that's owned by the government of Canada, that point is well taken."
Smitherman has suggested he can't let the jobs question dictate his final choice, although he has asked the bidders to place an emphasis on creating jobs in Canada.
As evidence of the difficulty of the decision, the government has shifted its deadline for final bids several times.
The first one came in October, which was then pushed back to Dec. 31, and has now been set for sometime early in 2009.
After the October deadline passed, Smitherman said it was because of intense negotiations, mainly over getting private-sector bidders to agree to pay for any delays and cost overruns caused by factors under their control.
Ontario hopes to get 13,000 megawatts of electricity from nuclear energy, with the privately-operated Bruce Power providing an additional 6,300 MW.
Ontario can currently meet a peak load of just under 25,000 MW. The province wants to cut peak demand by 2,700 MW by 2010.
The new reactors will be built at the Darlington site in Durham region, which has been left reeling by the economic troubles of General Motors Canada Inc., the city's main employer.
Darlington became synonymous with massive cost overruns when it was constructed almost 20 years ago. However, the nuclear industry has said construction techniques have improved and that all bidders have completed their recent projects on time and on budget.
With a report from CTV Toronto's Paul Bliss and files from The Canadian Press