Nuclear engineeers lose Darlington project

Thousands of engineers’ jobs will not materialize as expected, since the province of Ontario has decided to postpone building two new nuclear reactors at the Darlington plant east of Toronto. The province had selected Atomic Energy of Canada Limited (AECL) to design and build the plants, but on June 29 Minister of Energy and Infrastructure George Smitherman said they had suspended the competitive process, due to “concern about pricing and uncertainty regarding the company’s future.”

AECL’s bid was accepted as the only compliant one this spring, after submissions were received from the Canadian company as well as AREVA NP of France and Westinghouse Electric Company of the U.S. AECL’s proposal was to build the “revolutionary” ACR-1000 CANDU, Gen II+, 1200 MWE-class pressure tube reactor. AECL said in June that the Darlington project would “keep thousands of engineers and scientists in Ontario.”

Reports in the Toronto Star on July 14 said that the compliant bid had come in at $26 billion, three times higher than what the province had expected. The report said that the $26 billion would have “wiped out the province’s nuclear-power expansion budget for the next 20 years.”

The newspaper report said one reason for the high bid was because of the high risk cost and the fact that the federal government required AECL to include the risk in its bid. The $26-billion price tag would have worked out to around $10,800 per kilowatt, whereas the Ontario Power Authority had been working o a price of $2,900 per kilowatt.

Ontario Premier Dalton McGuinty suggested the project was still alive, however. In a Canadian Press report McGuinty said that the government would take into account the nuclear industry’s importance to the economy as it “sharpened its pencils” to help AECL come up with a better deal.

However, the province currently has more power capacity than it needs. Incredibly, given the scarcity in past summers, the Bruce Nuclear Power plant has closed down Unit 8 due to a surplus of power in province. Cool temperatures and the manufacturing sector’s slow down are being cited as reasons for the oversupply.