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Energy

Ontario Plans Major Nuclear Refurbishment to Meet Growing Electricity Demand

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5 minute read

Pickering Nuclear Generating Station

From EnergyNow.ca

Ontario Power Generation planning to extend life of aging Pickering Nuclear Generating Station by decades

Ontario Power Generation is moving ahead with a plan to extend the life of the aging Pickering Nuclear Generating Station by decades, as the province tries to secure more electricity supply in the face of increasing demand.

Nuclear big player in getting to Net Zero

“Our province still needs this station and its workers,” he said at a press conference outside the nuclear plant. The construction phase will create about 11,000 jobs, he said, and provide about 6,000 jobs for decades.

OPG plans to spend $2 billion on engineering and design work and securing key components for the project that is expected to be completed in the mid-2030s.

Neither Smith nor OPG officials would give an estimate for how much the entire refurbishment will cost.

“It would be irresponsible at this point in time to put a number out there, because it’s this essential design and scoping and engineering work that is going to get us to the place where we can have a number,” Smith said.

OPG said a refurbishment at its Darlington Nuclear Generating Station is costing $12.8 billion and is on time and on budget.

Ken Hartwick, chief executive of OPG, said the Darlington refurbishment as well as one at Bruce Power will help guide the Pickering life extension.

“We have learned a lot about what it takes to refurbish a nuclear station the right way with thousands of lessons learned from Darlington and Bruce Power that we will apply to Pickering,” Hartwick said.

The four units produce about 2,000 megawatts of electricity, enough to power two million homes.

The Independent Electricity System Operator has said Ontario’s electricity demand is expected to grow by about two per cent each year,  but could be even higher. A promise to build 1.5 million homes by 2031 and several large-scale manufacturing investments such as electric vehicle battery plants are helping to push demand higher.

The province needs more supply particularly starting in the mid-2030s, the IESO has said.

Keith Stewart, a senior energy strategist with Greenpeace Canada, said the price of wind and solar power with battery storage has “dropped like a stone” and should be more central to Ontario’s energy policy.

“Any credible independent cost-benefit analysis would find that we should be investing in the renewable-powered energy system of the future, rather than pouring billions more into rebuilding nuclear reactors long past their best-before date,” he wrote in a statement.

Pickering produces about 14 per cent of the province’s electricity but its current licence to operate the four units in question expires at the end of this year. OPG has asked the Canadian Nuclear Safety Commission to extend that to 2026, but a public hearing for that application has not yet been scheduled.

Green Party Leader Mike Schreiner said Greens understand that nuclear power will continue to be part of the energy mix for decades, but the province also needs much more wind and solar power and no more natural gas generation.

“Instead of attracting jobs and investment in low-cost renewables, the Ford government is making Ontario’s grid dirtier and more expensive by prioritizing dirty fossil gas plants and the costly, poor-performing Pickering plant,” he wrote in a statement.

The IESO announced last month that it is looking to add 2,000 megawatts of non-emitting electricity generation online such as wind, solar, bioenergy and hydro to the system. However, it also says natural gas is still required to ensure supply and stability in the short to medium term, though it will also increase greenhouse-gas emissions from the electricity sector.

Ontario’s electricity system was 94 per cent emissions free in 2020, but today that figure has fallen to 90 per cent.

The nuclear safety commission would still have to approve the Pickering refurbishment.

Two other units at Pickering are also set to stop operating at the end of this year. They are part of what’s known as the A units, which came online in the 1970s and were removed from service in 1997. Two of the units were refurbished and began operating again in 2003 and 2005.

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Energy

What does a Trump presidency means for Canadian energy?

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From Resource Works

Heather-Exner Pirot of the Business Council of Canada and the Macdonald-Laurier Institute spoke with Resource Works about the transition to Donald Trump’s energy policy, hopes for Keystone XL’s revival, EVs, and more. 

Do you think it is accurate to say that Trump’s energy policy will be the complete opposite of Joe Biden’s? Or will it be more nuanced than that?

It’s more nuanced than that. US oil and gas production did grow under Biden, as it did under Obama. It’s actually at record levels right now. The US is producing the most oil and gas per day that any nation has ever produced in the history of the world.

That said, the federal government in the US has imposed relatively little control over production. In the absence of restrictive emissions and climate policies that we have in Canada, most of the oil production decisions have been made based on market forces. With prices where they’re at currently, there’s not a lot of shareholder appetite to grow that significantly.

The few areas you can expect change: leasing more federal lands and off shore areas for oil and gas development; rescinding the pause in LNG export permits; eliminating the new methane fee; and removing Biden’s ambitious vehicle fuel efficiency standards, which would subsequently maintain gas demand.

I would say on nuclear energy, there won’t be a reversal, as that file has earned bipartisan support. If anything, a Trump Admin would push regulators to approve SMRs models and projects faster. They want more of all kinds of energy.

Is Keystone XL a dead letter, or is there enough planning and infrastructure still in-place to restart that project?

I haven’t heard any appetite in the private sector to restart that in the short term. I know Alberta is pushing it. I do think it makes sense for North American energy security – energy dominance, as the Trump Admin calls – and I believe there is a market for more Canadian oil in the USA; it makes economic sense. But it’s still looked at as too politically risky for investors.

To have it move forward I think you would need some government support to derisk it. A TMX model, even. And clear evidence of social license and bipartisan support so it can survive the next election on both sides of the border.

Frankly, Northern Gateway is the better project for Canada to restart, under a Conservative government.

Keystone XL was cancelled by Biden prior to the invasion of Ukraine in 2022. Do you think that the reshoring/friendshoring of the energy supply is a far bigger priority now?

It absolutely is a bigger priority. But it’s also a smaller threat. You need to appreciate that North America has become much more energy independent and secure than it has ever been. Both US and Canada are producing at record levels. Combined, we now produce more than the Middle East (41 million boe/d vs 38 million boe/d). And Canada has taken a growing share of US imports (now 60%) even as their import levels have declined.

But there are two risks on the horizon: the first is that oil is a non renewable resource and the US is expected to reach a peak in shale oil production in the next few years. No one wants to go back to the days when OPEC + had dominant market power. I think there will be a lot of demand for Canadian oil to fill the gap left by any decline in US oil production. And Norway’s production is expected to peak imminently as well.

The second is the need from our allies for LNG. Europe is still dependent on Russia for natural gas, energy demand is growing in Asia, and high industrial energy costs are weighing on both. More and cheaper LNG from North America is highly important for the energy security of our allies, and thus the western alliance as it faces a challenge from Russia, China and Iran.

Canada has little choice but to follow the US lead on many issues such as EVs and tariffs on China. Regarding energy policy, does Canada’s relative strength in the oil and gas sector give it a stronger hand when it comes to having an independent energy policy?

I don’t think we want an independent energy policy. I would argue we both benefit from alignment and interdependence. And we’ve built up that interdependence on the infrastructure side over decades: pipelines, refineries, transmission, everything.

That interdependence gives us a stronger hand in other areas of the economy. Any tariffs on Canadian energy would absolutely not be in American’s interests in terms of their energy dominance agenda. Trump wants to drop energy costs, not hike them.

I think we can leverage tariff exemptions in energy to other sectors, such as manufacturing, which is more vulnerable. But you have to make the case for why that makes sense for US, not just Canada. And that’s because we need as much industrial capacity in the west as we can muster to counter China and Russia. America First is fine, but this is not the time for America Alone.

Do you see provinces like Alberta and Saskatchewan being more on-side with the US than the federal government when it comes to energy?

Of course. The North American capital that is threatening their economic interests is not Washington DC; it’s Ottawa.

I think you are seeing some recognition – much belated and fast on the heels of an emissions cap that could shut in over 2 million boe of production! – that what makes Canada important to the United States and in the world is our oil and gas and uranium and critical minerals and agricultural products.

We’ve spent almost a decade constraining those sectors. There is no doubt a Trump Admin will be complicated, but at the very least it’s clarified how important those sectors are to our soft and hard power.

It’s not too late for Canada to flex its muscles on the world stage and use its resources to advance our national interests, and our allies’ interests. In fact, it’s absolutely critical that we do so.

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Energy

What Will Be the Future of the Keystone XL Pipeline Under President Trump?

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From EnergyNow.ca

By Terry Winnitoy, EnergyNow

The Keystone XL Pipeline, proposed in 2008, was designed to transport Canadian crude oil from Alberta to refineries in the United States, specifically to Steele City, Nebraska, and onward to refineries in Illinois and Texas, as well as to an oil pipeline distribution center in Cushing, Oklahoma.

Spanning approximately 1,179 miles and designed to transport up to 830,000 barrels of oil per day, the pipeline promised significant economic and energy security benefits. However, it became a focal point of political and environmental controversy, leading to its eventual cancellation by Presidents Obama and Biden.

Here’s a brief look at its history, the reasons it should have been built, the political dynamics that led to its cancellation and will President-elect Trump revive it?

Why the Keystone XL Pipeline Should Have Been Built

Economic and Job Creation

The pipeline was projected to create thousands of construction jobs and several hundred permanent jobs, providing a significant boost to the economy. It was also expected to stimulate economic activity through the development of related infrastructure and services.

Energy Security

By facilitating the efficient transport of a large volume of oil from a stable and friendly neighboring country, the pipeline would have reduced American dependence on oil imports from more volatile regions, enhancing national energy security.

Environmental Safety

Pipelines are generally safer and more environmentally friendly for transporting oil compared to rail or truck, with lower risks of spills and accidents. The Keystone XL was designed with the latest technology to minimize leaks and environmental impact.

Regulatory Oversight

The project underwent extensive environmental reviews and was subject to strict regulatory standards to ensure it adhered to environmental protection and safety measures.

Political Reasons for Cancellation

Environmental Activism

The pipeline became a symbol for environmentalists who opposed further development of fossil fuel infrastructure. They argued it would contribute to climate change by enabling the extraction and consumption of oil sands, which are more carbon-intensive than other oil sources.

Obama’s Cancellation

President Obama rejected the pipeline in 2015, citing environmental concerns and its potential impact on global climate change. He argued that approving the pipeline would have undercut America’s leadership on climate change.

Trump’s Reversal and Biden’s Final Cancellation

President Trump revived the project in 2017, citing economic benefits and energy security. However, President Biden canceled it again on his first day in office in 2021, fulfilling a campaign promise to prioritize climate change issues and transition towards renewable energy.

Political Symbolism

For both Obama and Biden, the decision to cancel the Keystone XL Pipeline was also a symbolic gesture, demonstrating a commitment to environmental sustainability and a shift away from fossil fuel dependence in line with their administrations’ climate policies.

Will President-Elect Trump Reinstate It?

Currently, there is no definitive answer on whether President-elect Trump will reinstate the Keystone XL Pipeline. His previous administration showed support for the project, citing its potential economic and energy security benefits. However, reinstating the pipeline would require navigating significant political, legal, and environmental challenges that have developed over the years.

It would also depend on the current geopolitical, economic, and environmental priorities at the time of his taking office. The Keystone XL Pipeline’s history is a complex tapestry of economic aspirations, environmental concerns, and political maneuvers.

Its cancellation has been a contentious issue, reflecting the broader national and global debates over energy policy and climate change strategy. Whether it will be reinstated remains a significant question, contingent on a multitude of factors including political will, environmental policies, and market dynamics.

That all said, re-instating its approval might be the perfect “in your face” moment for Trump to Obama and Biden as he begins his second term of presidency. We’ll have to wait and see.

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