As one of the world's largest uranium producers and nuclear power generators, Canada already has an established nuclear supply chain. Uranium is mined and milled in northern Saskatchewan and refined and consumed in southern Ontario, with nuclear waste managed in Manitoba, Ontario, Québec and New Brunswick. Canada's existing nuclear supply chain encompasses the full nuclear life cycle from design, construction and commissioning through operation and to decommissioning. Further, Canada is a world leader in nuclear research and development, with several research labs across the country.
Nonetheless, small modular nuclear reactors ("SMRs") present novel challenges. While Canada's 2018 SMR Roadmap claims that the SMR industry can benefit from the existing supply chain and leverage the $26 Billion CANDU reactor refurbishment projects underway at the Darlington and Bruce sites in Ontario, even Canada's mature nuclear industry must adapt in order to be ready for the advent of SMRs.
Increasing momentum for SMR feasibility
Canada's recent pledges to accelerate decarbonisation have put a spotlight on SMRs. Able to generate on-demand, zero-emission electricity, the miniature power plants are touted by proponents as a means of meeting future electricity demand while mitigating climate change. In the Canadian context, SMRs have drawn particular attention as a potential off-grid alternative to diesel generation at resource extraction sites and in remote communities.
These aspirations were the premise of Canada's Small Modular Reactor Action Plan released in December 2020, as well as a Memorandum of Understanding signed by the premiers of Alberta, New Brunswick, Ontario, and Saskatchewan.
For SMRs to gain traction as a clean energy solution, innovation in the domestic supply chain will be essential. Despite Canada's multi-billion dollar nuclear industry and already-robust uranium supply chain, SMRs present unique challenges. They will involve not only first-of-kind technologies, but also first-of-kind manufacturing methods. Unlike their large-scale counterparts, SMRs are portable enough that they are likely to be built more in the factory than in the field, demanding significant innovation in the design and manufacturing sectors.
With policy momentum building at the federal level and in at least four provinces, the nuclear industry in Canada is gearing up to confront these unique challenges and potentially position itself as a world leader in SMR deployment.
Following up on their Memorandum of Understanding, the governments of New Brunswick, Ontario, and Saskatchewan have released a report on the feasibility of SMR development and deployment in Canada (the "Feasibility Report"), prepared along with Ontario Power Generation, Bruce Power, NB Power, and SaskPower. Along with providing a feasibility assessment of SMR development and deployment, the Feasibility Report contains the power companies' business case for SMR implementation in each of the three provinces.
In the Feasibility Report, the power companies propose three streams of SMR projects, encompassing a range of power levels, designs, technological readiness levels, and end-user applications:
- Stream 1 - beginning with an approximately 300 megawatt (MW) project at Ontario's Darlington site by 2028, followed by up to four subsequent units in Saskatchewan coming into service in the 2030s;
- Stream 2 - development and construction of two advanced SMR demonstration units at New Brunswick's Point Lepreau site, anticipated to be operational by the early 2030s and expected to result in new lower-cost units that recycle nuclear waste, have more inherent safety attributes, and may provide models for global deployment; and
- Stream 3 - involving a new class of micro SMRs designed primarily to replace diesel use in remote communities and mines. In order to advance this technology, a 5 MW gas-cooled reactor project is already underway at Ontario's Chalk River site and is expected to be in service by 2026.
Noting that investment in supply chain development will be "critical" to broader SMR deployment in Canada, the Feasibility Report presents these pilot projects as opportunities to prime nascent supply chains.
Canada's supply chain: retooling and reskilling to be SMR ready
Even Canada's mature nuclear industry must adapt in order to be SMR ready. Canada's nuclear supply chain is not yet evenly distributed across the provinces, with Ontario seeing the bulk of refinement, consumption, and waste management activities. All interested provinces, including Ontario, must undergo retooling and reskilling in order to meet the unique SMR equipment and material specifications, and to adapt to new methods of deployment involving modular construction with factory assembly. Existing manufacturers of nuclear components will need to implement advanced manufacturing methods and lean manufacturing principles to reduce SMR costs and shorten development schedules.
Beyond advanced and lean manufacturing, retooling the supply chain to support SMR technology will involve significant capital costs. It's therefore no surprise that one of the streams of projects envisioned in the Feasibility Report – Stream 1 – takes a fleet-based approach. This will maximize supply chain opportunities for Canadian businesses, enabling them to benefit from standardization and economies of series. In turn, standardization could increase expertise and supply chain capacity in a shorter time frame, thereby giving Canadian suppliers a competitive edge in export markets.
Then there is the cost of businesses adapting their processes and quality management programs, and adopting the overarching safety and security culture that are required of nuclear qualified suppliers. In this area, Canada could look to the U.K. for guidance. There, the Nuclear Advanced Manufacturing Research Centre has pioneered a unique service called "Fit For Nuclear" that lets companies measure their operations against the standards required to supply the nuclear industry – in new build, operations, and decommissioning – and take the necessary steps to close any gaps.
Using Fit for Nuclear as a template, Canada could launch a similar program that coaches, trains, and advises businesses along the journey to becoming qualified to participate in the highly regulated and specialized nuclear industry.
If a domestic supply chain emerges, SMRs have the potential to become a new industrial subsector, one that is not only pan-Canadian but also an international leader. The development of SMRs could provide a post-refurbishment growth opportunity for Ontario's nuclear supply chain while creating an SMR manufacturing/export business based in several provinces.
Given this potential, governments could look to SMRs as a significant tool in the transition to a low-carbon economy. As a versatile source of dispatchable power, SMRs could one day fill important roles in Canada's energy landscape: from buttressing renewables on electricity grids, to cost effectively stabilizing and modernizing energy supply in remote communities and industrial operations, to producing emission-free thermal energy for hydrogen fuel production and new remote and urban district heating systems.
Alberta, who most recently signed onto the interprovincial Memorandum of Understanding on SMRs, intends to one day apply the technology in resource extraction sites and northern communities. Additionally, three Indigenous-owned development companies in northern Saskatchewan recently announced support for SMRs and an intention to participate in the SMR supply chain.
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