AECL creates subsidiary for planned transfer to new operator in 2015

Neutron gap unavoidable

Atomic Energy of Canada has created a wholly owned subsidiary – Canadian Nuclear Laboratories – to assume full responsibility for operating all of its sites including the massive Chalk River Laboratory division. The move, effective November 3rd, represents a major step forward in AECL's restructuring from a crown corporation into a Government-owned, Contractor-operated (GoCo) facility – a process that will conclude in fall 2015 with the transfer of CNL to a new private-sector operator.

AECL has committed to ensuring the contractor fulfills its obligations and will retain ownership of the laboratories' physical and intellectual property assets, as well as its liabilities. It will also continue to fund CNL's operations, albeit at a fixed rate. Once the transfer is completed, AECL will remain as a small entity focused on managing and overseeing the contract with the new operator.

"The government is looking for a vision. The language in the laboratories that people are embracing is safety, results and the bottom line … We will seize opportunities and move forward with new ideas," says Dr Robert Walker, president and CEO of CNL, adding that the new subsidiary sends a clear signal to "get our mindset where it needs to be".

Like the transformation of the National Research Council, the restructuring of AECL represents a significant cultural shift for its 3,300 employees, 3,000 of whom work at the Chalk River facility — down from nearly 5,000 in 2009. Much of the decline is due to the sale of AECL's Candu business to SNC Lavalin (R$, August 9/11).

In the past five years, Parliamentary appropriations for operating and capital were: $528 million (2009), $822 million (2010), $793 million (2011), $719 million (2012), and $552 million (2013).

With the restructuring, the government's stated objectives are to manage its radioactive waste and decommissioning responsibilities, ensure that nuclear S&T capabilities and knowledge continue to support the federal government's nuclear roles and responsibilities and provide industry access to nuclear S&T expertise. The latter includes ongoing access to the labs at full cost recovery rates.

"The customer for two of those missions is the Government of Canada," says Walker. "Also, there's a commitment to recapitalize so that we are absolutely necessary to these missions."

In anticipation of the restructuring, AECL has been reorganizing internally, shifting away from its previous model of servicing specific lines of business for various customers to the creation of 10 virtual centres of excellence aimed at bringing nuclear technology to a broader industry base. As examples, Walker says AECL is now working with auto parts suppliers on material light weighting and durability, and is expanding into the aerospace sector as well as pharmaceuticals.

"The day-to-day operations will be in the hands of a private sector consortium," says Walker, adding that it will work with universities, engage in the generation of highly qualified personnel and enhance access to CNL facilities. "We have 17 nuclear facilities under our licence here and all are open to access by industry and academics."

As part of its cultural shift, CNL is hiring people with skill sets suited to an industry-facing organization and investing in several areas including a $50-million new hydrogen isotope facility, $100 million for a new S&T complex to open in 2017 and several new labs that will roll out over the next five years.

Only three of the 10 newly created centres of excellence are enabled by the aging National Research Universal (NRU) reactor, which is currently licensed to 2016. CNL plans to apply for a further extension to 2021 but there are no definitive plans to replace it.

Walker did not want to speculate on whether CNL will consider a further licence extension to 2026.

Neutron gap

Walker acknowledges that even if a new reactor were approved for construction today, there will be a period in which users won't have access to a neutron-generating reactor.

"A new reactor will take more than six years to build so we will have a neutron gap," he says. "We've begun looking at an interim period if we had a neutron gap while we seek an ultimate solution for a replacement reactor."

The research community has realized that a neutron gap was looming for several years. Researchers experienced a 15-month gap in 2009-10 when the NRU was shuttered due to a heavy water leak, prompting them to seek out time on reactors in US labs such as the Oak Ridge National Laboratory, operated jointly by the Univ of Tennessee and Battelle Memorial Institute, headquartered in Columbus OH.

"We will have to dig deeper in our travel budgets and go further afield," says Dr Thad Harroun, a physics professor at Brock Univ and a member of the Canadian Institute for Neutron Scattering — the largest academic research user of the NRU. "I've never heard ‘no' to a new reactor and I hope the company that wins the contract has a new NRU as part of its vision."

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