Category Archives: CNA Responds

CNA Responds Nuclear Energy

Finding Facts in the Fog of Fiction

By John Stewart
Director of Policy and Research
Canadian Nuclear Association

Have you seen the email that says, “The nuclear industry doesn’t want you to think about Quebec”? Well, we actually do want you to think about Quebec, because the argument that Ontario could import cheap electricity from Quebec and scrap the refurbishment of the Darlington generating station just doesn’t work.

Commission report on Quebec's energy futureQuebec’s commission on energy policy turned in a report in February 2014 on its public consultations – the same report used as the foundation of the import-from-Quebec argument.

As we pointed out last week, the business case to import Quebec electricity just isn’t there in today’s power market. Don’t just take our word for it. Look at these direct quotes from the commission’s report. (The translation is ours.) It turns out that Quebec is awash in supply that it’s been overpaying for in costly, misplaced efforts to encourage alternatives:

“Electricity demand has flattened…. Despite this, Quebec has added important sources of production: wind, small hydro, biomass…. This reality results in an annual subsidy to electricity producers that will reach $1.2 billion in 2017, at the expense of power consumers and taxpayers.” (p. 21)

“In North America, including Quebec and Ontario, authorities subsidize renewable energy on their own territory… rather than pay a premium for clean energy imported from outside….” (p. 181)

That new supply has been costing Quebec much more than its traditional big hydro. To cover that cost, Hydro Quebec needs to export power at peak periods. Otherwise, it loses money:

“Today, these surpluses can only be disposed of on export markets. The first 10 TWh are exported at peak periods at high prices and are profitable for Quebec. The rest, about 20 TWh, is exported in off-peak periods at an average price of $0.03/KWh. But, the cost of energy from new production sources added since 2008 varies between $0.06/KWh and $0.12/KWh.” (p. 21)

The export channels, or “interconnects,” that export those profitable 10 TWh/year cannot handle a greater load:

“The additional (20 TWh) cannot be sold at peak periods because the current interconnects with neighbouring markets are saturated; it can only be sold in off-peak or base periods at prices that are too low to make recent investments profitable….” (p. 176)

More interconnects are not the answer in this market. Rather, the commission recommends against new export deals, and it calls on the Quebec government to trim the subsidized sources of supply within the province:

“There is no doubt in the Commission’s mind that the government of Quebec must immediately cease new requests for the production of electricity and that it must cancel contracts in the process of renewal….” (p. 184)

As we pointed out last week, this is one reason why actual deals for long-term electric power have been expensive in 2014 (more than 10 cents per KWh in the New England power pool).

Electricity exporters have to earn much more than the average cost of production from their big, efficient base-load generating stations – hydro dams in Quebec, and nuclear energy stations in Ontario. They also have to subsidize pricey alternatives. That’s why they need a sales price that covers production costs plus subsidies.  And any power supply that replaces Darlington must be not only large (over 3,000 MW), but available around the clock – not just off-peak or whenever the interprovincial connections allow it.

The bottom line: facts are facts. The price of power is what people pay for it, and not some made-up number based on flawed assumptions. In today’s market, a profit-seeking Hydro Quebec wouldn’t want to sell electricity to Ontario on a sustained basis below the cost of its most expensive production.

Here’s another fact: nuclear energy safely delivers reliable, low-cost power to Ontario. And, in displacing coal and natural gas from Ontario’s supply mix, nuclear energy reduces Ontario’s greenhouse gas emissions by nearly 90 megatons per year.

You’d think an organization that promotes clean air would celebrate nuclear’s zero-carbon emissions rather than generate a fog of fiction.

CNA Responds

Buying Power from Quebec: Opportunity Mugged by Reality

By Dr. John Barrett
President and CEO
Canadian Nuclear Association

Over recent months, a number of opinion pieces have appeared in Canadian newspapers advocating an Ontario Clean Air Alliance call for Ontario to cancel nuclear refurbishment plans in favour of purchasing what they call “cheap” electricity from Quebec. In response to this, Canadian Nuclear Association President John Barrett has written an opinion piece appearing in yesterday’s Toronto Star explaining why such a proposal ignores the realities of Ontario’s power system. 

At first glance, the idea of bringing electricity from Quebec into Ontario makes sense. After all, Ontario’s electricity prices are rising; Quebec already exports vast quantities of electricity to the New England states.

However, the Ontario Clean Air Alliance (OCAA) and its Quebec ally, Equiterre need to do their homework before pressing this case much farther. Their argument to replace Ontario nuclear power with Quebec hydroelectric power ignores the value that nuclear power provides to the province. It also overlooks the realities of Ontario’s power system.

Ontario’s nuclear plants produce power safely and reliably every day around the clock. Refurbishing the Bruce and Darlington plants will extend their lives for decades, providing an economical, long-term supply of clean electricity for Ontario. Refurbishing 10 reactors also means Ontario will create thousands of jobs within the province.

The reality of an Ontario-Quebec power deal is that it will be purely commercial. Quebec is a very sharp and tough contractor for whom electric power is a rock-hard commercial business. There will not be any nation-building discounts or new Fathers of Confederation.

If you doubt this, consult the power authorities in Newfoundland and Labrador. In 1969, they signed a generation contract with Hydro-Québec that drove power prices steadily lower over 65 years. Even the onset of massive inflation – the general price level has jumped more than 500 per cent since 1969, according to the Bank of Canada – brought no upward adjustment in the price Newfoundland receives for its power.

The six New England states buy electricity from Hydro-Québec through their Independent System Operator (ISO-NE). Since the start of this year, wholesale power contracts for this New England grid have averaged $100 per megawatt-hour – roughly a dime per kilowatt-hour. OCAA and Equiterre suggest that Hydro-Québec would sell power to Ontario at 5.7 cents per kilowatt-hour. Why should Hydro-Québec accept that price when it can get almost twice as much from New England?

Even if Hydro-Québec cut a special deal for Ontario, the needed infrastructure does not exist. Ontario built its electrical grid with self-sufficiency in mind, and its ability to meet electrical demand in Toronto depends on the wires that would carry power from Quebec.

Imagine that Ontario imported all the electricity from Quebec that it could. Interprovincial connections can carry 2,545 MW, or about 70 per cent of the capacity of the Darlington nuclear generating station. But once it crossed the provincial border, Quebec’s electricity would travel through Ottawa on power lines that more resemble a one-lane cart path than a four-lane highway. Upgrading these lines would cost hundreds of millions of dollars, and raise power bills accordingly.

Even if Ontario upgraded its lines, however, there remains the issue of Quebec’s export reliability. Hydro-Québec would not meet Ontario’s needs year-round.

In a May 22 letter to Ontario’s system operator, Hydro-Québec writes, “commitment periods need to take seasonal diversity into account.” Quebecers heat with electricity, making winter the season of peak power demand. Feeling a capacity squeeze last winter, and the winter before, Hydro-Québec asked its customers to turn down their thermostats. Even now, Hydro-Québec is issuing contracts to buy power for the next four winters. This hardly sounds like a reliable, year-round power supplier.

What can we learn from these realities? Do the homework, and don’t jump at too-good-to-be-true options.

There are reasons Ontario built its power system the way it did. It sought energy security and self-sufficiency. Ontario could have built a grid that relied on Quebec imports. Instead, it chose nuclear. Along the way, it gained a nuclear industry that has created thousands of jobs in Ontario.

Nuclear-generated electricity was the right choice for Ontario decades ago. It remains the right choice today.

CNA Responds Nuclear Energy

Our Strength: We’re our own Toughest Critics

By John Stewart
Director, Policy and Research
Canadian Nuclear Association

Canada’s nuclear energy sector “plays a key role in driving innovation, generating jobs, and providing low electricity rates.”  That’s the first conclusion of the Public Policy Forum’s recent report on the sector’s future.

CNA read it with great interest, not just because we’d sponsored it, but because we did not get to co-write it and, until we received an advance copy a little while ago, we did not know what it would say.

Canada’s nuclear industry values the broad, multi-stakeholder conversations on which the report was based.  And we respect PPF’s independence in summarizing them.

It’s not perfect or unassailable – no study is – but it’s an unbiased assessment of where we stand in the world, and we wanted that.

(We should note that the report covered only nuclear energy, and not the many other applications of nuclear technologies in which Canada is a world leader, such as medical imaging and diagnosis, radiotherapy, materials testing, and food safety).

Of course, we wouldn’t necessarily agree with everything in the report.

  • It’s self-contradictory at times.  (Is our reactor technology “lagging” or is it “leading-edge”?)
  • It understates our public approval, or “social license.”  (Nuclear produced 59.2% of Ontario’s electricity last year.  Ontarians appreciate affordable, reliable power, and the host communities in which we operate love their thousands of durable, highly trained jobs).
  • It tends to view Canada’s investment in a unique, and in many ways better, reactor technology as a challenge rather than a strength.  (You could underestimate any emerging brand or technology in this way at some point in its development).

Many industries’ advocates might have tried to meddle in such a report at the drafting stage, and tried to align it with their own messaging.  CNA didn’t.  Some lobbyists, eh?

Well, the nuclear energy industry isn’t just any industry.  It’s a hard-headed scientific and engineering culture in which we know we need to be the best.

We start by being our own toughest critics.

Then we invite our peers in to assess us with fresh eyes (like the World Association of Nuclear Operators does with its peer review process).

And then we comply with (or, usually, exceed) international standards (like those set by the International Atomic Energy Agency and other bodies).

That’s how we get the kind of performance that we do:

So we’re proud to congratulate PPF on its assessment of the future of Canada’s nuclear energy sector.  Warts and all, we welcome the scrutiny, and we look forward to working with them again.

CNA Responds Nuclear Energy

Just the Facts, Ma’am. Just the Facts.

You’d think the facts would persuade people like the Canadian Association of Physicians for the Environment (CAPE) . But that appears not to be the case.

Gideon Forman, their executive director, apparently told health authorities in Haliburton region that kids living near nuclear energy facilities face higher risks of leukemia.  Forman, who is not a medical doctor, cited the widely discredited German study Kinderkrebs in der umgebung von Kernkraftwerken (KiKK), published in 2008. (The title translates to “Childhood Cancer in the Environment of Nuclear Power Plants.”)

Here’s the problem. It’s just not true.

In fact, several follow-up studies have reviewed the KiKK work. Every one of them concluded that the kids’ leukemia risk could NOT be blamed on the nearby nuclear energy facility.

Even CAPE acknowledges in its own literature that the German study proved nothing: “The authors state that the reason for the elevated risk is unexplained, as the levels of radioactive emissions from these facilities are considered too low to explain the increase in childhood leukemia.” (Source:  Cathy Vakil and Linda Harvey, Human Health Implications of the Nuclear Energy Industry, p. 62)

As the Canadian Nuclear Safety Commission said in its review of the KiKK studies, “any claims of a link between childhood leukemia and radiation from nuclear power plants are unfounded and not supported by a wealth of evidence resulting from multiple epidemiology studies.”

And as the commission chairman, Dr. Michael Binder, wrote last August in a letter to the Hamilton Spectator  specifically rebutting CAPE’s allegations, “The truth is that studies have shown over and over that people living near nuclear power plants are as healthy as the rest of the population.”

Forman also cited scientific studies to show that “all reactors release radioactive material routinely” but failed completely to put this into perspective.  The truth is that nuclear energy facilities generally add less than 0.1% to the background radiation that occurs naturally.

In fact, Canadians receive over 100 times more radiation dose naturally through the food we eat than from Canada’s nuclear energy facilities.

Those are the facts. Shouldn’t doctors deal in facts rather than fiction?

CNA Responds

Wind Attacks Nuclear, Gets Blown Away

By John Stewart
Director, Policy and Research
Canadian Nuclear Association

Chris Forrest is the vice-president of communications and public affairs at the Canadian Wind Energy Association. He wrote an op-ed that appeared in the Hamilton Spectator attacking nuclear on a variety of fronts. Here’s our response to the unnecessary and non-factual assault.

Chris Forrest’s attack on nuclear (“Wind Energy is a Better Deal for Ontario than New Nuclear,” Jan 4) is unnecessary and non-factual.

It’s unnecessary because Ontarians aren’t called upon to choose one energy source over another.   We use many diverse energy sources that support and complement each other.

It’s non-factual because Forrest says that “pricing on nuclear is very hard to find” but in the same breath that “it is broadly understood that electricity from new nuclear generation will be significantly more expensive” than the rate he claims for new wind.

If the data is so hard to find that he doesn’t cite any, what’s the basis for this alleged “broad understanding?”  Nuclear helped to build the affordable business environment that made Ontario so prosperous over the past half-century.

The 2011 Ontario Auditor General’s Report remarked that “Billions of dollars were committed to renewable energy without fully evaluating the impact, the trade-offs, and the alternatives through a compre¬hensive business-case analysis” (page 97). The report also cited Ministry of Energy and Ontario Energy Board projections that residential electricity bills will increase by 7.9% annually over the next five years primarily due to investments in renewable energy (page 89), resulting in a $570 increase in annual household electricity bills between 2009 and 2014 (page 95).

Nuclear power generation currently sells on average at around $.06 per kWh.  By providing this stable, affordable base, nuclear enables the grid to diversify into new sources like wind.

Advocates for wind energy are welcome to make their case without attacking other, good and proven options.

CNA Responds Nuclear Energy Nuclear Pride Nuclear Safety

CNA Endorses OPG’s Applications for Renewal of Darlington Facilities

The Canadian Nuclear Association (CNA) welcomes and endorses Ontario Power Generation’s (OPG) applications to renew its Darlington facilities. These applications cover refurbishment and ongoing operation of the Darlington nuclear generating facility, and renewal of the Darlington Waste Management Facility’s licence for a 10-year period.

“I’m delivering this message not just on behalf of at least 60,000 Canadians whose livelihoods are supported by our industry, but also for the 13.5 million Ontarians who deserve to enjoy the same affordable clean air energy in the future that they have in the past,” said Heather Kleb, CNA President and CEO.

“Darlington supplies electricity that is extremely reliable, reasonably priced, emits virtually no greenhouse gas from operations, and delivers high-wage, highly skilled jobs. The Darlington Nuclear Generating Station has been one of the largest contributors of electricity to Ontario’s power grid since 1990. We at CNA feel very strongly that the continued service of these facilities is vital for an ongoing stable supply of base load electricity to Ontario homes, workplaces and businesses.

“The Darlington station is an extremely valuable economic resource that has not yet reached the mid-way point of its functional service life. By renewing it, Ontario has a great opportunity to realize more value from this asset. The front-end cost of nuclear plants is spread over several decades of operating life, allowing them to produce electricity at low and predictable unit costs.

“Nuclear is one of the assets that has made Ontario so attractive in the past for investors and knowledge industries. Darlington is helping that to continue.”

A recently released study by Canadian Manufacturers and Exporters determined that nuclear is an integral part of Canada’s innovation, manufacturing and export capacity. Refurbishing ten nuclear reactors will support at least 10,000 jobs for the coming eleven years, plus ongoing long-term jobs in plant operations.

Ms. Kleb added that the safety of operations at Darlington has been demonstrated through 20 years of commercial power generation at this site, and over 40 years in the province.

Ms. Kleb spoke on December 5 at a Canadian Nuclear Safety Commission (CNSC) Public Hearing in Courtice, Ontario.