Efforts to usher Canada’s chief natural gas-producing province into the atomic age — and potentially add a new power exporter to the North American grid — have escalated to competition on an international scale.
The first entry in the developing race to build Alberta’s first nuclear power plant grew up overnight into an industrial project from a promotional pitch as a result of a takeover. Bruce Power, a 3,800-employee operator of six Ontario reactors, paid an undisclosed price to buy a C$6 billion proposal to build a new generating station near Peace River, about 500 kilometers (300 miles) northwest of Edmonton.
Bruce took over the project from Energy Alberta, which was a sales team of veteran Calgary oil and gas industry entrepreneurs Wayne Henuset and Hank Swartout. The pair had a marketing contract with Atomic Energy of Canada Ltd. to get nuclear power on the provincial agenda, but they had no technical expertise and limited financial resources.
The deal gives Bruce exclusive rights to use AECL’s CANDU technology in Alberta. The latest, “advanced” version of reactors marketed globally by the Crown corporation will be adopted for the Peace River project.
Although the project’s new sponsor is an Ontario firm, it is majority-owned by two Canadian industrial heavyweights operating on an international scale, TransCanada Corp. and Cameco Corp. Minority partners include a pension fund and unions of Bruce employees.
TransCanada is the parent company of TransCanada Pipelines and has an array of power interests initially launched as a sideline to marketing gas to power stations. Saskatoon, Saskatchewan-based Cameco is the world’s largest investor-owned uranium mining firm that has 20% of the energy-rich mineral’s global production.
While potential power exports have yet to achieve a prominent spot on the provincial political agenda, they are on industry drawing boards — and especially at TransCanada. The company is gradually but actively advancing a project called Northern Lights Transmission among industry interests and regulators along the western side of North America.
The proposal calls for potentially two new power lines reaching from the northern Alberta oilsands belt to the U.S. Pacific Northwest and eventually California. Northern Lights has been tentatively incorporated into a 20-year outlook forecast by the Alberta Electric System Operator, independent manager of the transmission grid and power trading pool.
The bitumen belt spanning northern Alberta is already a growth spot for power generation because oilsands projects routinely build oversized electricity plants in the hopes of selling excess supplies into the grid. Thermal extraction systems use so much steam that they can drive significantly oversized power plants. Northern Lights Transmission was designed to make power exports a byproduct of oilsands transmission, and nowhere is it written that the electricity lines could not also take output from nuclear plants.
The Bruce takeover surfaced soon after international competition to build Alberta’s first atomic power station broke out into the open, when the Canadian subsidiary of France’s nuclear energy conglomerate courted public support for an Alberta plant proposed closer to the provincial capital city.
Eager local encouragement greeted Areva Canada president Armand Laferrere when he trekked 150 kilometers (100 miles) northwest of Edmonton to the heavy industry town of Whitecourt, armed with plans freshly approved by the Paris head office of his firm’s parent company.
A combination of rising demand for power — generated by long-range sustained growth in fossil fuel production and the provincial population, plus a rare tolerance for yet more development in the most active industrial areas north of Edmonton — piqued French interest.
“We think it would be a great thing for our community,” Whitecourt Mayor Trevor Thain said. He predicted at least 75% of local voters would back an atomic power project in a civic referendum that he plans to hold as development plans firm up in the future.
The price of the ensuing Peace River project’s takeover was not disclosed. But “Bruce made an offer the principals of this company (Henuset and Swartout) couldn’t resist,” Energy Alberta spokesman Guy Huntingford said.
The next steps will be to set up a new subsidiary, Bruce Power Alberta, in a location still to be decided then embark on design and environmental assessment work, Bruce President Duncan Hawthorne said. He set no deadlines on the process.
Civic leaders in Peace River also keenly support industrial development, including oilsands projects, although a highly vocal minority is resisting to the point of staging protests on the steps of the provincial legislative building in downtown Edmonton.
Canadian nuclear projects typically take three years and cost C$30 million to advance to the point where they are ready for regulatory approvals and sponsor commitments to start construction, Hawthorne said.
Work will be done with the Canadian Hydrogen Association on generating an economic bonus. Using electricity from the proposed atomic power station to make hydrogen will be studied. Oilsands plants employ the gas to make premium synthetic crude.
The province has no atomic power plants and a record of popular and government opposition to them, Hawthorne acknowledged. “That doesn’t mean you won’t need them,” he said. High industrial, population and electricity demand growth rates could make total Alberta power requirements jump 67% to 15,000 MW from a current 9,000 MW by 2017 or 2018, Hawthorne predicted.
“Having willing host communities and the site in Peace River is a great start to looking at broader opportunities in Alberta,” he said. “Any decisions we make will rely heavily upon having a willing host community.” He also indicated a willingness to look at other sites — including Areva’s Whitecourt target — if Peace River turns against Bruce.
“It’s a great place to do business,” Laferrere said, describing the invitation to try a project in northern Alberta as a refreshing change from initial fear and resistance Areva ran into elsewhere in building its global chain of 98 atomic power stations. “This is a sufficiently rare event in the nuclear power industry that we should show appreciation,” Laferrere said.
The Whitecourt public visit followed months of quiet overtures by the French company to Alberta communities, electric utilities and construction companies. Discussions have also been held with provincial officials including Energy Minister Mel Knight, Laferrere said. Further talks are also planned with an atomic power committee created by a policy convention of the ruling Conservative party, the French executive added.
No commitments have been made by the province’s political leaders except to stay neutral on the developing project competition, and that means “we’ve had a good reception from the government,” Laferrere said.
“They want the marketplace to come up with a project before taking a stance. That’s a very good approach — saying ‘you prove to us this can be done and then we’ll talk,'” he said.
In power industry circles, Areva has high credibility and is a formidable competitor. The 58,000-employee French firm is about 30 times bigger than Canada’s AECL. Areva built 58 reactors that generate 78% of France’s electricity and 40 plants in other countries. Two more stations are under construction in Finland and France. Expansion is under way in the United States.
The latest projects include the first use of a new plant design, the “evolutionary power reactor” (EPR), which cuts costs of nuclear power by an estimated 10%.
The system reduces radioactive waste, eliminates total overhauls that shut down previous generation plants for a year or more, adds safety precautions and eliminates the “heavy” or radioactive water used by AECL’s older CANDU technology.
Areva has growing operations across Canada with about 1,100 employees at 18 locations including northern Saskatchewan, where the firm is the nation’s second biggest uranium miner after Cameco. The firm operates in every stage of atomic power production, including electricity transmission and nuclear waste disposal.
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