A look at small modular reactors, from Hitachi Canada’s chief executive

With carbon tax loss in Supreme Court, Saskatchewan looks to SMRs

With a March 25 Supreme Court of Canada ruling firmly entrenching a federal carbon tax, the question now is how do we live with it? More specifically, how can we create ample greenhouse gas emissions-free energy to run our economy?

One option being given serious consideration is the construction and implementation of small modular reactors (SMRs), essentially cookie-cutter reactors that can be employed across the country. And it’s one option that Premier Scott Moe had been touting as key to Saskatchewan’s strategy.

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On Feb. 25, the Chartered Financial Analysts (CFA) Society Saskatchewan held a “dinnerless dinner” online, with its focus on the development of small modular reactors in this province.

Among the three speakers was Howard Shearer, who spoke about “The Promise – Small Modular Nuclear Reactors Offer Saskatchewan. Shearer is chief executive with Hitachi Canada. He pointed out he was speaking on his behalf, not his company’s. He has been with the company 36 years.

Shearer gave an example of a small Hitachi reactor, capable of up to 300 megawatts, which is “very small, very compact.”

“There are approximately 150 SMR designs in development worldwide,” he said, added there were over 100 responses to the Canadian Nuclear Laboratories roadmap of expression of interest.

He spoke of “the promise of SMRs.” This includes solving many social problems, climate change, and the environment. “If we are to have an honest discussion, which is so crucial, as we embark upon the SMR journey, we must look back at the past and understand what we must correct to have a successful future,” Shearer said. 

“For large reactors, for example, the OECD countries today, new-build projects are late, over budget, and are challenged to compete with alternate sources of electricity.”

Since large reactors are built so infrequently, he noted that there is a lack of new-build continuity for new reactors. Even if it’s same design, it’s essentially first-of-a-kind. A weakened supply chain, weak project management, operations focused on project delivery rather than critical path construction, increasing national regulatory requirements, including the lack of international harmonization are other reasons he listed. Lack of a clear policy on carbon, by governments, is another.

“SMRs are seen today as the path forward for carbon free nuclear energy solutions based on the fact that todays’ SMR includes advanced technology, with increased safety and simplicity,” Shearer said.

Fuel failure safety within the new SMR designs are one of the key aspects. “Of course, because of the modulization of the design and the technology applied, it eliminates some construction risk, which could be up to 40 per cent of the risk for large light water reactors,” he said.

Some large reactors are 12 years delayed and over budget.

“It can be constructed in a factory, delivered to site, and connected in a modulization perspective,” he said of SMRs.

“All SMRs suffer from economy of scale, given your small sizes compared to a large light water reactors.”

He spoke of generation 3 and generation 4 technologies being employed, with inherit increased safety. But the newest generation 4 ones must be licensed, which means the regulator becomes critical.

He said some vendors suggest a safety perimeter of 400 yards as opposed to 10 miles for large reactors.

To be fully implemented, the regulations for these reactors must be harmonized across jurisdictions. They has not happened, to date, on larger reactors. Shearer pointed out that there has not been harmonization of light water reactor regulations over 60 years. “This is a critical factor that will impact costs,” he said, and part of the critical path for SMRs.

He gave an example of Saskatchewan-built SMRs, but facing different regulatory requirements as it goes globally. This is what makes the roles of government, regulators, vendors and supply chain so important.

Shearer gave examples of challenges SMR projects face, including contractual issues, financing from vendor countries and regulator collaboration. An early realistic business case must be done, for nuclear and non-nuclear, he said.

Shearer said Hitachi came to Saskatchewan in 1970 for a coal plant, and then transitioned to gas plants, and now they are discussing SMRs.

“Social license must be the priority. Indigenous engagement must be initiated at the very beginning of the program. This is so important, and even more critical, as the concept of economic reconciliation takes place,” he said.

“You must define the timeline, and need, assess the technology risk and realistically include maturity of design and licensing, status and risk. Maturity of design is so important, because unless the design is fixed, it cannot be licensed and if it cannot be licensed, it cannot be built,” he said. This becomes a challenge moving from regulator to regulator, nationally and internationally.

A vendor’s design and history needs to show “a nuclear culture of safety,” he said. “The designer would support that assessment, and view nuclear long-term investment, long-term processes, long-term commitment, and of course, long-term benefit.”

He said Saskatchewan’s power grid, with 4,000 megawatts of multiple forms of generation, and interconnections to its neighbours, would be suited for SMRs.

Long-term forecasted growth in Saskatchewan demand may or will require power imports, he noted. “The supply deficit will continue to accelerate due to society's move to decarbonize production, market forces driving to achieve their emission targets in transportation sector and other GHG intensive processes, such as agricultural and urban lifestyles. It is also, as mentioned before, the proposed carbon tax under consideration, seen as a policy tool by government to influence behavior towards zero emission.  

He said it was not a surprise that Ford, the week before, announced it would be selling all electric vehicles by 2030. “Just think of that, and think of the pressure that will put on the grid, going forward,” he said.

Hydrogen will also play a significant role for vehicles, he noted. “How does Saskatchewan tap into that?” he asked.

Saskatchewan could not only produce the uranium, but also provide the geological repository to deal with nuclear waste, he noted.

SMRs can also produce isotopes for use in medical applications.

The first stage is a licensed demonstration of the first SMR in Canada, which he expects will happen at Canadian Nuclear Laboratories “in the very near future.” 

Public engagement has to start now, he noted. Supply chain capacity must be built, including the preservation of the knowledge that comes with it. “Having a sustainable knowledge base that will build programs in academia, skill sets that will last for 60 years, because remember, an SMR would go for 60 years,” he said.

“Probably a successful outcome of multiple projects would be delivered on-time, on-budget, using decisive project management, with right-size governance, a completed design, a sustainable, competitive supply chain, very productive labour culture, export opportunities into the global market, supported by a robust Canadian manufacturing base, operating from Saskatchewan,” he said.

And most important, this would provide a competitive, levelized cost of electricity for both grid and off-grid.

“I will say that I'm very optimistic, very bullish that SMR will meet the challenge,” he said.

© Copyright Carlyle Observer

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