AECL set to benefit from resurgence in nuclear power as energy option

Optimism is growing within Atomic Energy of Canada Ltd (AECL) that the pressures of rising energy consumption and climate change regulations could increase demand for nuclear-generated power, providing a much needed stimulus for its technology, products and services. A recent meeting of the Canadian Nuclear Association (CAN) drew nearly 500 delegates — the largest gathering in its history — to hear corporate and government leaders suggest that the nuclear industry may be on the verge of a turnaround.

Natural Resources Canada (NRCan) minister John Efford addressed the conference and declared that Canada could experience a “real nuclear renaissance”, echoing the theme of the CNA conference — The Nuclear Renaissance – Powering Up — and the sentiment of the nuclear community as a whole. He cited the R&D efforts of AECL and expressed the government’s continuing support of AECL’s Advanced CANDU Reactor (ACR) program.

Efford’s comments prompted speculation that federal support for AECL may be increased from the $100-million level where it’s been stuck for the past several years. Although there was no mention of AECL in the recent Budget, the details of its annual funding allocation will be released when the Part III Estimates are released in the coming weeks (pending Parliamentary approval of the Budget).

“Until the plan is made public and tabled in the House, we aren’t really at liberty to disclose the amount. But the minister did say that he supported the (R&D) program and continues to do so,” says AECL president Robert Van Adel. “We’re very pleased because frankly you can see the industry really turning around. It’s coming. New builds are not just being talked about here, they are being talked about around the world …. It feels pretty good after a few years of being pretty rocky.”

Van Adel says Ontario offers considerable potential for new reactor sales and refurbishment of existing facilities. The election pledge of the McGuinty government to phase out coal-fired electricity generation has enhanced the profile of the nuclear option. But in an address to the CNA conference, Van Adel said the province must make up its mind quickly.

“Ontario has to start the approval processes now — especially the Environmental Assessment … for site-specific new nuclear projects — to meet the earliest in-service date of 2014,” he stated.

AECL has come a long way since the late 1990s when the crown corporation was mired in red ink and frustrated by the lack of new sales opportunities. But the rising demand for energy coupled with the decision of many countries to consider nuclear reactors as part of their energy mix has had a positive impact on the bottom line. In FY03-04, AECL posted a small operating profit — the first in years — on revenues of $496.5 million.

DISPUTE WITH MDS

But AECL is by no means out of the woods. Work on two key products — the ACR and the MAPLE (Multipurpose Applied Physics Lattice Experiment) reactor — are behind schedule. The latter project has been the focal point of a simmering dispute between ACEL and MDS Inc, the parent company of MDS Nordion. Earlier this month, Ontario Appeals Court justice Stephen Goudge was appointed to seek a resolution on issues relating to the construction, commissioning and operation of the MAPLE facilities at AECL’s Chalk River location.

MDS Nordion currently uses the aging National Research Universal (NRU) reactor to produce medical isotopes for a global market. Several years ago, AECL agreed to build two isotope production facilities and a processing facility for MDS Nordion. But the reactors are still not commissioned due to regulatory and technical issues. According to AECL’s most recent (FY03-04) annual report: “AECL has been in negotiations with the customer (MDS Nordion) regarding the overall level of costs born by the customer and the possible effects of the delay on the customer’s business. The timing of resolution is uncertain.”

NRU VS CNF

The NRU is another area of uncertainty. Built in 1959, the NRU is critical to AECL for development of the ACR and other products. Several years ago, it was slated for decommissioning in 2005 to be replaced by the Canadian Neutron Facility (CNF) The CNF was originally a joint proposal by AECL and the Canadian physics research community, but AECL is no longer backing it, opting instead to seek an extension of its NRU operating licence by conducting extensive refurbishments.

“We’ve discovered quite recently that the NRU itself — for the purposes other than isotope production which eventually MAPLEs will replace — is still viable. It’s still viable as a research reactor,” says Van Adel. “We’ve invested quite a bit in upgrading it and we believe we can extend the licence of the NRU beyond the date that we thought it would go out of service. Let’s not forget that five years ago, there was a movement to build the CNF ... so there was no real imperative to look at extending the NRU’s life.”

“NRU is a wonderful reactor,” says Dr David Torgerson, AECL’s senior VP technology. “It’s still very good for a lot of the things we want to do on CANDU development.”

While AECL is no longer backing the CNF, the $500-million proposal is by no means dead. It is being championed within the NRC and informal discussions are taking place on how to proceed. A meeting with new NRC president Dr Pierre Coulombe will take place in the coming weeks.

“AECL only wants (a research reactor) for CANDU. They’re using the NRU and want to keep it going,” says a government official. “The NRC wants to take it to a higher level and do something for the country, something more visionary.”

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