John Gorman is president and chief govt officer of the Canadian Nuclear Affiliation.
In terms of the local weather disaster and power safety challenges, the Canadian nuclear business is a strategic asset. We all know easy methods to ship low-carbon energy, power safety and financial alternatives.
The blockbuster acquisition of nuclear firm Westinghouse Electrical Co. by Cameco Corp. and Brookfield Asset Administration Inc.’s renewable firm a couple of weeks in the past is proof of that. The acquisition, value US$7.9-billion together with debt, was the primary main deal underneath Brookfield’s World Transition Fund I, an formidable green-shift initiative led partly by former Financial institution of Canada governor Mark Carney.
However how a lot the nuclear business will be capable of contribute to our nation’s local weather and power targets will likely be restricted by the principles of the sport – guidelines that must be adjusted to make sure nuclear is ready to compete pretty with all different low-carbon applied sciences.
That’s to not say the federal government hasn’t supported nuclear as a part of Canada’s clear power transition, on particular events. Most not too long ago, the announcement that Canada Infrastructure Financial institution, or CIB, is investing $970-million in Ontario Energy Era’s mission at Darlington to develop the nation’s first industrial, grid-scale small modular reactor, or SMR, was welcomed enthusiastically by the nuclear business.
That announcement was made after a collection of different funding commitments for particular nuclear power tasks over the previous few years. In March, 2021, Moltex obtained $50.5-million from Canada’s Strategic Innovation Fund, or SIF, to help the event of their molten salt reactor and spent gas recycling facility. Funding from SIF has additionally been granted for Terrestrial Vitality’s Integral Molten Salt Reactor ($20-million) and Westinghouse’s eVinci microreactor ($27.2-million). Nonetheless, these examples are all the sort of “choose and select” help that’s unsustainable in the long run and doesn’t encourage wholesome competitors.
A extra sustainable method is simple to search out south of the border. The Inflation Discount Act, handed by the U.S. authorities in August, offers manufacturing tax credit and an funding tax credit score for not solely present nuclear energy vegetation but in addition for brand spanking new nuclear energy vegetation, together with SMRs. Crucially, these are the identical tax incentives accessible to different clear power applied sciences, reminiscent of photo voltaic photovoltaic and wind.
This broader, extra inclusive method, which creates the sort of stage enjoying discipline we’ve been asking for, was summed up properly by CIB president and chief govt officer Ehren Cory, who spoke on a panel on the Canadian Nuclear Affiliation’s Financing for Nuclear summit on Oct. 20. He mentioned, “We’re know-how agnostic, however we’re not end result agnostic.”
Being know-how agnostic means clear power is clear power, whatever the supply; it’s the outcomes that matter. The outcomes of extra massive and small nuclear reactors in Canada are decrease greenhouse fuel emissions, extra predictable and inexpensive energy provide, and main financial advantages by way of jobs and manufacturing – over 70 per cent of the elements and supplies for the brand new SMR being developed by Ontario Energy Era at Darlington will likely be sourced in Ontario.
These potential financial outcomes are additionally beginning to drive non-public funding. Brookfield and Cameco’s Westinghouse deal is just not the one instance. There was an oversubscription to the nuclear inexperienced bonds issued final 12 months by Bruce Energy, and this previous summer season by Ontario Energy Era.
But nuclear stays at a drawback. In Canada, photo voltaic and wind are eligible for a variety of monetary incentives not accessible to nuclear. Even carbon seize and storage, which is by definition a transitional know-how on the way in which to internet zero, will get preferential remedy.
Probably the most evident instance of this imbalance was the specific exclusion of nuclear energy from Canada’s Inexperienced Bond Framework, revealed in March. This exclusion is actively stopping the business from tapping into what we all know is critical non-public urge for food for funding into the sector. Nuclear was additionally excluded from clear power tax credit introduced in 2020 in addition to the accelerated capital price allowance for clear power gear.
As america presses forward with an all-fuels and all-technologies method, and different Group of Seven nations reminiscent of Britain, France and Japan make investments closely of their nuclear fleets, Canada continues to be taking discrete and tentative steps.
And incremental help for a selected mission, irrespective of how vital, isn’t any substitute for honest, steady and predictable coverage and monetary help accessible to all low-carbon applied sciences. Vitality industries from throughout the nation, together with nuclear, renewables and even oil and fuel, are able to compete for the alternatives arising from the clear power transition. We’re simply asking for a stage enjoying discipline, notably relating to tax incentives.