Canada Infrastructure Bank Commits $970 Million to Canada's First SMR

October 31, 2022

Written By David Macaulay, Luke Morrison, Sharon Singh and Dayo Ogunyemi

On October 25, 2022, the Canada Infrastructure Bank (CIB) announced it is investing $970 million towards Canada’s first small modular reactor (SMR). The agreement with Ontario Power Generation (OPG) supports the development and construction of a 300-megawatt SMR next to OPG’s existing 3,500-megawatt Darlington Nuclear Generating Station.

This is an exciting step forward in advancing low carbon generation technology and the hope is that Canada can play a role as a world leader in the SMR industry. SMRs are nuclear fission reactors that can produce significant amounts of low-carbon electricity despite being considerably smaller in scope and footprint than conventional nuclear reactors. As a baseload power source, SMRs are well positioned to play an important role in supporting the mix of other renewable generation and achieving net-zero strategies around the world. Our previous blog, Small Modular Reactors: A Key Component to a Low Carbon Future?, gives an overview on the SMR landscape in Canada and the opportunities and challenges for development.

Some notable points from the CIB's announcement on the Darlington SMR are below.

Scope of Investment

This is CIB’s largest investment in clean power to date. It provides low-interest financing and covers capital costs for phase one work, which includes project design, procurement of long lead-time equipment, utility connections, site preparation and project management requirements. The CIB sees the Darlington project as supporting Canadian efforts to become a global SMR technology hub.

Traction for SMRs

The CIB says the Darlington SMR is expected to spearhead similar projects in Saskatchewan, New Brunswick and Alberta. Under the March 28, 2022, Strategic Plan for the Deployment of Small Modular Reactors, Alberta, Ontario, Saskatchewan and New Brunswick agreed to collaborate on the advancement of SMRs as a clean energy option to address climate change and regional energy demands.

Recent provincial developments include:

• September 2022: The New Brunswick Government and NB Power hosted a delegation from the Government of Saskatchewan and SaskPower to strengthen readiness and collaboration for development of small modular reactors, touring the Point Lepreau Nuclear Generating Station.
• August 2022: X-energy signed a framework agreement with OPG to identify potential customers and sites in Ontario and elsewhere in Canada to deploy its SMR technology for industrial applications.
• August 2022: Terrestrial Energy and Invest Alberta signed a Memorandum of Understanding to support commercialization of Terrestrial Energy’s Integral Molten Salt Reactor (IMSR®) Generation IV SMR plant in Western Canada.
• June 2022: The Business Council of Alberta released a report entitled Define The Decade which cited SMRs as a critical area of the energy sector in Alberta requiring reinvention, as part of broader recommendations to create a competitive and sustainable economy in the province.
• June 2022: SaskPower selected the GE-Hitachi BWRX-300 for potential deployment in Saskatchewan in the mid-2030s. This is the same technology being used for the Darlington SMR.

Approvals

With an approved Environmental Assessment already in place, the Darlington site is the only location in Canada licensed for the development of new nuclear facilities. The Darlington SMR project is being managed in a gated approach, subject to OPG board approval at each gate.

The CIB's announcement on the Darlington SMR is available here.

We will continue to monitor the development, opportunities and challenges for SMRs in Canada. If you would like to discuss SMRs, please contact David Macaulay, Luke Morrison, Sharon Singh or Dayo Ogunyemi.

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